As a business counselor, I encounter a lot of business professionals and aspiring entrepreneurs who want to be their own boss or have an inventive concept for starting or buying a new firm. I have to warn you that establishing and building a new business is a long and difficult path, but it can be incredibly exciting and rewarding if you find the appropriate fit and do your study before you begin.
Over time, I’ve compiled a list of high-priority considerations that I suggest to anybody embarking on this journey in order to reduce the agony and cost of false starts and unsuccessful efforts along the road. Unfortunately, given my experience as an angel investor, over 90% of new company endeavors fail, leading me to conclude that many of you would be better off sticking put.
In any event, these are the actions I propose for everyone, even if you’re already sure that the new career and opportunity are appealing and the risks are low:
1. Align with your personal objectives and interests.
If your aim is to improve the world or aid the underprivileged, another dating site or online gaming, no matter how financially rewarding, may not be for you. Also, launching a startup is not the same as taking over an established firm, where the emphasis is on repeatable procedures and quarterly earnings.
For example, when Yvon Chouinard created Patagonia, a successful outdoor products firm, his true purpose was to provide environmentally friendly items. He also enjoys donating 1% of sales to environmental organizations all around the world.
2. Create and present a strong business plan.
The days of declaring your proposal with such zeal that qualified team members and investors would line up to join in with both feet are long gone. Plan to devote a few months on this endeavor, and then spend at least half of your time presenting and selling it the first year.
The true usefulness of a written business plan is that it compels you to think through all of the pieces of a new firm in particular terms, to balance your emphasis on things you enjoy, such as technology, while avoiding aspects you despise, such as finances and recruiting.
3. Select your destination to land after the start.
Some people prefer beginning businesses, while others enjoy growing them. Choose a concept that you can rapidly pitch to investors or that you can nurture as a legacy for your family. Innovative technologies need iterative development, whereas other concepts are essentially commercial and financial in nature.
4. Assess who you can get for value and mentoring.
You require counselors to assist you in overcoming difficult problems and to advocate for your potential and success. These might progress from an advisory agreement to a board of directors. These directors provide value, but they also serve as your supervisor and critic for everything you do to develop and thrive.
5. Be prepared to network with potential investors and team members.
You can start a business on your own, but scaling it requires an employee team as well as investors, vendors, and partners. These connections must be developed over time, balanced with your personal life, and expanded to include important customers, competitors, and possible acquirers.
6. Learn how to put strong business procedures into action.
To maintain smooth development and vitality, every sustainable firm needs repeatable procedures and management systems in place. That implies you must be receptive to constant learning and stay current in your field. There is no business where you can just sit back and enjoy the fruits of your labor.
7. You make decisions based on data or your intuition.
You may be at ease steering your future based on vision and feeling, or you may have a penchant for facts and measurements. Disruptive innovations need foresight and the courage to take a risk, whereas gradual changes to established competitors must be managed with data and elegance.
8. Devise a strategy for your long-term role or exit.
Many business owners are forced out as their companies age, while others arrange their own exit to start another firm or retire to spend time with their families. Rather than being disappointed, be proactive in establishing the necessary organization, grooming the proper people, and enjoying the fruits of your effort.
Overall, I’m pleased to say that new business owners and entrepreneurs who do their study are happier and healthier than other professionals in the business world. Even if you decide not to quit your present position, I encourage you to use the same ideas in your current career, such as finding work you enjoy, aiming for a greater purpose, and creating a plan for a better future.