With entrepreneurism reaching an all-time high, there are new businesses opening everyday. Unfortunately there are also many that are closing each day. So how do you know if it’s time to take the leap and start your own company? Contrary to the claims of numerous “experts,” consultants and blogs, there is no formula for determining when (or if) you should start a business. However, you can find some guidance if you’ll consider when NOT to start a business…
- Don’t start a business if you haven’t counted the costs - and not just the financial costs. Real entrepreneurs know that starting a business is a commitment unlike any job you’ve ever had. The time required, the real financial costs and the stress of uncertainty are factors that many would-be business owners don’t consider until it’s too late. So, don’t start a business until you ask yourself, “Do I really want to start a business?” and “Why do I really want to start a business?” Until you can coherently and convincingly answer those questions don’t go any further.
- Don’t start a business because you’re sick of working for your idiot boss. While the idiocy of others can be a great motivator, it’s not a foundation. Consider what you don’t like about your boss and you may find shortcomings in yourself that will hinder your ability to run a business effectively. If your boss is constantly on you for being late, then you make lack the discipline you need to effective manage your own company.
- Don’t start a business because you hate your job. Starting a new enterprise should never be solely a reaction to what you don’t like about your life. Explore what you don’t like about your current job and honestly evaluate whether the challenges of starting a new company would offset the unpleasantness of your current job.
- Don’t start a new business because you want a better work-life balance. Unless you are already insanely wealthy, starting a business will require more time, effort, stress and money than you are currently expending working for someone else.
- Don’t start a business because you are an expert at something. In many situations, prospective business owners are experts at the service or product they intend to offer. The problem is that actually running the business will consume more of your time than practicing what you know. You might be an expert in women’s fashion but what do you know about storefront leases and signage permits? Entrepreneurs are required to be “jacks-of-all-trades” and the one where they are a master doesn’t get the attention they originally thought it would. The first expertise for an entrepreneur should be adaptability.
- Don’t start a business if you want to change the world. Repeat after me, “The reason to be in business is to make money.” You are welcome to incorporate “changing the world” into your overall mission, but unless you make enough money to support yourself and pay your bills, you will not stay in business. Don’t argue that non-profits are different, they still must remain solvent to last.
- Don’t start a business just because you have the money. While available cash certainly makes the process easier, it is not the cure-all that many expect. If you have money from an inheritance, a retirement or any other windfall, find a reputable financial adviser and discuss your options. Starting a business is more than a financial proposition and all of the challenges need to be considered before you make the commitment.
Now, if you still want to be your own boss so that you are in control of your future and the mark you leave on society – great! Starting a business is more enjoyable and rewarding than you can imagine and most entrepreneurs wouldn’t re-enter the “corporate world” willingly. Get ready to constantly be on the lookout for new clients and opportunities, prepare yourself for the continual search for good employees and most of all remind yourself of why you did start your business.