Starting Your Own Business Part II: 12 Solutions
A couple of weeks ago I wrote about 12 Problems with starting your own business. It was an overwhelmingly negative article. Hopefully I can bring some balance to this blog with this follow-up.
1. You donâ€™t have enough startup capital. Yes, starting a business takes money. $53,000 on average, in fact. But that doesnâ€™t mean your business needs that. What you lack in funding can often be made up for with ingenuity. Work out an exchange of services with an accountant or lawyer. Office space? Work out of your home until you need an office. Marketing? Go check out Guerilla Marketing for Free. There are dirt cheap ways to do pretty much anything if you canâ€™t afford to do them â€œright.â€
2. Youâ€™re too busy. If you keep your day job, youâ€™ll work on your new venture at night. If you quit to do this full time, youâ€™ll discover itâ€™s hard to turn it off. Either way, youâ€™ll feel like youâ€™re working two full time jobs. But there are ways to find more time in your day. Working from home can free you up to work rather than commute. Keeping organized can help you focus and be more productive with the time you have. But be careful to avoid burnout. Make time for your family, your personal life, and your mental health.
3. You donâ€™t have a good idea. Businesses rarely succeed based on ideas. Think of the idea as 1% of your business. The next 99% is made up of execution â€“ customer service, quality product, effective marketing, efficient delivery, and so on. Paul Graham wrote:
â€œ[People] overvalue ideas. They think creating a startup is just a matter of implementing some fabulous initial idea. And since a successful startup is worth millions of dollars, a good idea is therefore a million dollar idea.â€ (source)
4. You canâ€™t compete. Yeah, there are a lot of competitors out there. Letâ€™s go back to the â€œideaâ€ problem. Itâ€™s not about the idea, itâ€™s the execution. When Google was founded, there were hundreds of search engines with big names and plenty of resources. Google didnâ€™t muscle its way into the market with a huge campaign (it doesnâ€™t really advertise itself) or by buying out competitors. It simply did things better. It saw an opportunity to innovate (this was their real idea) and executed well. Google won market share by doing things better. As Iâ€™ve said before, you donâ€™t have to build the first mousetrap â€“ you just have to build a better one.
5. You couldnâ€™t handle the failure. Failure is how we learn. As every chef has burned himself and every carpenter slammed his thumb with the hammer, business failure isnâ€™t the end of the road. Failure is how we learn to succeed. Itâ€™s a harsh lesson, yes, but you must be resilient and open. If you are capable of learning from your mistakes, you can avoid them next time.
6. You have too many other commitments. You have to take risks in order to achieve rewards. But that doesnâ€™t mean risking whatâ€™s truly important. And before you stop reading, let me say this: â€œwhatâ€™s truly importantâ€ doesnâ€™t include eating out, having an expensive car, cable television, etc. Start with a strong financial base yourself. If this means starting your business while you have another job, thatâ€™s fine. In my first year of business, I set my salary at the bare minimum I needed to pay my bills. I found I actually needed much less than I had been living on. And when you start actually making money, youâ€™ll find it easier to manage the excess (and do something smart with it).
7. You need benefits. Yes, health insurance is expensive. For a small business, you wonâ€™t get group discounts. Explore high-deductible, low-premium accounts. Health savings accounts. Talk to your local chamber of commerce â€“ many have cooperative health insurance plans you can join. Thatâ€™s where many small businesses get together so everyone gets group discounts.
8. Youâ€™re in a bad location. Easy! Doing business over long distances has become much easier with the Internet. This isnâ€™t new â€“ but new tools have made it easy to set up online storefronts, manage projects, do billing, etc. Many freelancers discover that itâ€™s possible to working from home and deal with clients anywhere in the world.
9. Youâ€™re just not an entrepreneur. And thatâ€™s fine! In E-Myth The E-Myth Revisited, Michael E. Gerber describes the three personalities of a business owner that you must balance and reconcile: The Entrepreneur, Technician, and Manager. Just as the â€œideaâ€ is only a tiny part of your business, the Entrepreneur is just a slice of your personality. Learn to draw on the manager and technician in you, and youâ€™ll discover that the concept of entrepreneurship is overrated.
10. Itâ€™s not reliable enough. What makes you think your full time job is so reliable? Your job could be eliminated or outsourced tomorrow. Even big companies fold â€“ what do you think the workers at Enron would say? The only â€œreliabilityâ€ factor in working for an established company is cash flow. And this is a tough problem to overcome. Learn to manage cash flow both for your personal life (see #1 above) and the business to keep costs as low as possible. Reliable is a lot easier when you set the bar low.
11. You donâ€™t know where to start. There are a lot of ways to learn about running your business. Get a mentor. Partner with experienced professionals. Look to the Small Business Administration for resources. Read books. Search Google. The key to success isnâ€™t knowing all the answers; itâ€™s knowing where to look when you have questions.
12. Itâ€™s just too hard. Of all the problems in Part I, this is the one that stands sorta true. Starting a small business is hard work, but the real lesson is that keeping it going is even harder. If youâ€™re afraid of hard work, youâ€™re not going to succeed in any business, whether you own it or not.
Hopefully, youâ€™ve learned that itâ€™s possible to overcome all of these problems. Hard work, combined with ingenuity, skill, and a willingness to swallow your pride, can pay off. If you want to color outside the lines, sometimes itâ€™s best to draw your own lines and color them in however you want. While itâ€™s not for everyone, if youâ€™re reading this then youâ€™re probably capable of making it happen.
If you want to learn more, check out the resources I mentioned. If you think youâ€™ve already got your idea, starting thinking about how to execute it. Create a business plan. Do your research. And most importantly, do something about it.