So You Want To Start A Business
Ok, so you’ve made the decision that you want to start a business. That’s great! Congratulations! Being an entrepreneur and living the “startup life” can be great! It can also, however, be extremely challenging at times, so you’ll want to make sure that it is the right decision for you.
Since starting a business is a decision that some people learn to regret, I want to encourage you to ask yourself three very important questions before you take the plunge. There are many more questions you should being asking before starting a business, of course, but these are three critical ones:
Why do I want to start a business?
There is a variety of reasons to start your own business. Maybe you are tired of working for and lining the pockets of others. Maybe you believe that being your own boss will be less work, or at least if you do have to work hard, you’ll be working for your own account. Maybe you’ve seen others enjoy extraordinary success as entrepreneurs and you’d like in on that action. The list could go on and on, but let’s address the reasons above, for starters.
Being tired of working for others can be a great motivator! Just realize that even if you don’t have a direct boss as an entrepreneur, there will always be people you are “working for,” including, and especially, your customers. Depending on the industry you’re entering, the level of competition and how demanding your customers are, you may find out that sometimes it doesn’t feel like you are your own boss, even if you own the business!
We won’t spend much time here on the idea of being an entrepreneur as being less work than working for others – it’s not! It starts and ends with you, so you are “on” 24/7. As an entrepreneur, you will likely find it very difficult to get mental health time to just relax and rejuvenate.
What if you’ve seen others be very successful, perhaps in a short period of time and you want to get in on that? Some entrepreneurs do reach extraordinary levels of wealth and success, but realize that usually those who appear to have gotten there quickly have most likely been at it, usually with a history of learning through mistakes, for a long period of time! There are very few instant successes in entrepreneurship!
What is my commitment level to the startup I’m about to create?
Following on what I said above about there being few instant successes in startups and entrepreneurship, realize that you are most likely in for a marathon, not a sprint! That’s true even if you feel like you’re running so quickly most of the time that it’s hard to catch your breath!
So, I ask again, what’s your commitment level to the business that you’re considering starting? Is it something that you can picture yourself doing, day and night, for many years to come? Could you be happy over a long period of time working in the business you’re looking at starting? If not, I’d strongly encourage you to rethink whether it’s the right business for you!
Is there an exit strategy for the company I am creating?
No matter how much you think you’ll love your startup and the business as it grows, at some point you are going to want to or have to get out of it – you will have to make an exit.
Is there a potential exit strategy for the business you are starting, or will you “be the business”? It’s not necessarily a non-starter if you can’t see a clear exit from your business for the get-go, but I can tell you from experience that it will become a lot more relevant as time goes on!
Some of the potential exit strategies would include selling your business to a third party buyer, or to employees, or even to your family members. In very few cases, you may also be able to take the company public or find other ways to refinance it to achieve some level of liquidity. However you think you may be able to exit the business, other than simply shutting it down and selling the assets, if any, for pennies on the dollar, you’ll want to consider that ahead of starting the business and factor that into your decision on whether it’s the right business for you to start.
Consider the questions above and other factors that are relevant to you, before you start your business! Be thoughtful in the startup process and you’ll greatly increase your chances of starting and building a business that will meet your financial needs, and equally important, allow you to be happy over the years to come.