This article is based on a podcast that I did with Alan Clarke which you can find here. In this country starting a business is easy, you sign a few forms, pay a bit of money and hey presto, you have a company. Running a business is hard. After 3 years and countless interviews with entrepreneurs on my podcast I thought it about time that I put together a list of things that any budding founder or small business owner should know before the embark on their journey, so here are the 10 most important things you need to think about before starting a business
Know that it is not all about you – it is about your customers
Starting a business can be a bit of an ego trip. You are the main person driving the business, its your vision and you are doing what you want to do. The thing is, its not quite like that.
If no one wants to buy what you are selling then you’re stuck with a great service or product but no one is exchanging it for money.
Listen to the market and your customers, what you think might be great may not resonate with the wider public
Choose the right business for you, choose the right problem to solve
I’ve seen founders start businesses in industries they have no experience in
This isn’t a bad thing, new thinking and disruption is what new business should be about but sometimes the founders go too far and think that they can cobble together a team based on an idea and it will storm the world
Make sure you understand the problem you are trying to solve and why your solution is the right answer to that problem
The most successful entrepreneurs I know have lived the problem they are trying to solve and can tackle it using the knowledge they have gained when facing that issue themselves.
Make sure you understand yourself and your motivations for starting a business. What do you bring to the table?
What are you actually good at?
Why should customers, employees, investors believe in you and why are you the right person to solve the challenge?
Are you doing this as a way to get rich quick – because that very rarely happens or are you in it for the long haul and able to roll with the inevitable ebbs and flows of starting a business
If you don’t have a long term view, you’ll become disinterested very quickly.
You don’t know everything so recognize the gaps in your knowledge and find the people that can bridge those gaps. Don’t be afraid to delegate
Are you a micro manager? Can you admit to what you don’t know and seek help where necessary?
As a business owner you have many many things to think about, sales, marketing, finance, tech, customer service
- You can’t do it all so don’t.
- You need to find the best people that you can afford to do the job and infuse them with your vision.
- Finally, you will need help.
Have a plan! Think of it as a roadmap rather than a detailed plan
You don’t have to plan everything down to the finest detail but you do need to know where you are going, how you’re going to get there and importantly – how much money you’ll need
The key here is to recognise that your plan is only a guide book. Think Covid. You may have had the grandest plans before the pandemic but once that kicked in, those plans go out the window – but the end goals don’t
If you have an idea of where you’re going, you’ll find ways of getting there.
Know your numbers inside out!
If you don’t understand profit and loss, gross margins, cash flow, balance sheets. Go learn.
Don’t rely on your accountant, they have plenty of other clients to deal with, by the time your accountant tells you that the cost of making your widget is more than selling it until it is too late
Once you’ve learnt go get help from a Virtual CFO to help you plan and strategise, if you are on top of your numbers you’ll be able to weather all surprises that the business will throw at you.
Understand what you want to get out of the business from a personal perspective
No one starts a business to work 12 hours a day 7 days a week but that’s what we end up doing (I’m writing this on a Saturday evening) so it is important to know what you want from your business in the long run
Do you want to spend more time with the kids, have a better house, travel more – if you
Do you want to spend more time with the kids, have a better house, travel more – if you can align your business with your goals you’ll be a happier person and when you’re happy, you’re more creative and ultimately you’ll improve your business and drive it forward more because you love what you do.
There is no entitlement, you will get what you deserve
Customers don’t magically walk through the door and offer you money (well, it does depend on what profession you’re in).
If you sit back and expect money to fall into your lap or customers to ring you up then you are bound to be disappointed.
You will ultimately get back what you put in.
Things can be lonely, work can be all-consuming. Find networks and mentors
Mental and physical health takes a hit when you start a business, especially if you have no co-founders. The business is in your head every day of the week and there really is no such thing as a holiday.
You need to reach out to the community, you will find that everyone will have the same shared experiences and that no matter what issue you’re facing there’ll be someone out there that has been through the same thing
Also, you sometimes just need someone with a different perspective giving you their thoughts. Diversity of thought is one of the key ingredients to creativity and creativity will help keep you and your business alive.
It can be fun but scary but be prepared to take risks!
If you are scared of risk then don’t run a business. Its the single most riskiest thing you’ll do in life because the decisions you make don’t just impact you and your family but all of those with a stake in your success
It’ll be fun and immensely satisfying but dear me…it can be very, very scary!
If you want to talk about your new business idea and how to get it off the ground, get in touch