Are you crazy?! Probably. But no one said being an entrepreneur was a safe bet.
If you're thinking about starting a business, now is a unique time to assess whether or not your idea has the legs to withstand a global pandemic. Now is a great time to ask yourself whether or not there is a need for your business locally, nationally, or globally.
It's also the perfect time to assess whether or not your business would be deemed essential. If not, and things go back to a version of normal but people have less cash, would your product or service be something consumers will be willing to splurge on? If not, you now have the opportunity to tweak your idea to provide a solution to the problems your target market is experiencing.
You, our dear, entrepreneurial friend, are in a unique position to disaster-proof your new business. So how to begin? We have seven simple steps to get you prepared for the difficult, but rewarding, road ahead.
1. Do some soul searching.
You've probably already taken the time to think about whether or not starting a business is the right move for you. But it's still good to have an objective viewer come in and question you a bit further. Well, it's us. We're that viewer.
First, assess how your plans play out in your personal life. Starting a business will definitely affect your family obligations, but that doesn’t mean you can’t start one. It just means you need to have open lines of communication and make sure everyone is on the same page.
Once the work-life balance conversations have been had, look to yourself to understand your entrepreneurial qualities and the qualities you might lack. It's unlikely you'll be able run every aspect of your business long-term, so identify your weaknesses early so you can build your business with people that compliment your strengths.
Also ask yourself: can I really see myself doing this long term? The idea of owning your own business sounds sexy. It just does. But once the grand opening glitter is swept away, and let's say your best case projections don't pan out, will you still be happy running your own show? You will be responsible for the livelihood of yourself, your team, and you'll be the one accountable for the satisfaction of your customers. Running your own business will present new possibilities and a bunch of new challenges.
But let's be real. It's impossible to sweep away every piece of glitter...
2. Nail down your vision, mission, and values.
Once you've asked yourself the difficult questions, you can begin planning and a great place to start is with your Vision, Mission, and Values. These elements of your business plan sound like the fluff you add to tick a few marketing boxes, but listen when we say: this sh*t is important.
Knowing your vision and mission sets the course for you and your employees. It also serves as the baseline for making the big decisions that come up every once and a while for entrepreneurs.
When it comes to operating a business, it's all about values. Your values help others assess whether or not you're the type of person and organization they want to work with. Equally, if a potential client comes along with values that don't align with yours, you have a documented point of reference to help you justify your reasons for saying no to a project that might not be the right fit for you and your team.
It's important to do your homework ahead of starting a business to see if it’s worth your while. If we asked for a show of hands: who is reading this because they are sick of working for someone else? We could probably bet and win a few dollars that your hand is up. Working for yourself can be ideal, just make sure you've done your homework. We don't want to see you leaping out of the frying pan and into the fire.
To begin, take a look at what's going on in the industry you want to go into. Is it growing? Is it leveling off or declining? If either of the latter, find out why and assess whether or not it makes sense to jump in. If not, how can you tweak your product or service to make it viable?
Secret shop your competition. It's perfectly fine to see what others are doing. Never copy, just learn from others' mistakes and figure out what you can do to better serve your dream customers.
Speaking of dream customers, conduct customer research. You can do this on a budget and it will definitely pay off!
4. Write your business plan.
Have you ever Googled the failure rate of startups or small businesses? Looking this up is like WebMD-ing a mild headache. You might as well accept your fate and make sure your affairs are in order. It's the same for Googling the stats of the success rates of starting a business--but failure is usually due to a lack of planning.
Many people don’t fully understand the financial and personal investments that need to be made. Through proper business planning, you can mitigate a lot of the risk that comes with starting a new brand.
Need help constructing a business plan? Google is your best friend. But if you need a bit more hand-holding, find a local or virtual business planning class to help you nail down those sections. There are also loads of resources online, including this Work From Home Playbook. Whatever your learning style, the small business world has the resources to help you start, run, and grow.
5. Research, again.
Did we mention research? Oh yea, it was point three. But it's worth driving home the point. Your research will never be over. Your business is a living, breathing, evolving beast, that you can control, as long as you're well informed and prepared for change.
Your original business plan will change. If it does, you're doing it right. Business plans serve as a basis for decision making, but it's important not to get too attached. Your business will need to respond as the industry changes, as the competitive landscape changes, and as you change. So keep the document for reference, but don't fret if things don't go according to plan.
6. Fund your dream.
If you're like many entrepreneurs, you will might need to seek funding from lenders, investors, or you'll be super scrappy and bootstrap the dang thing. And that's okay. Sometimes you have to spend money to make money. You just need to be smart about it.
If you're seeking funding from outside sources, a business plan is key. Ensure your financial projections are accurate and align with any goals or objectives listed elsewhere in your plan. Once the details of the plan are in place, practice your elevator pitch to everyone you know, and maybe some people you don't. If you feel out of your comfort zone at this point, you're on the right track.
Not sure how much funding you need? Calculate your Valley of Death. This is the period of time you anticipate having negative cash flow, due to your startup costs, before you are cash positive from revenue coming in from your customers. An investment or loan should cover this period of time, plus a 20% contingency (just in case!) while you get on your entrepreneurial feet.
7. Get your brand out there already!
This is the fun part. Once you've earned the right to start your brand through research, business planning, and funding, take it to the streets with a shiny new logo, brand book, and a professional, kickass website. Just think about how good it will feel to order those crewnecks with your logo front and center! And don't forget to capitalize on word-of-mouth marketing and build partnerships to generate referrals.
Even when all of the stars align, starting a business is a big, hard deal. Starting one during a time of uncertainty can seem like an even larger undertaking. But with the right planning, you'll set yourself and your business up for success.
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Bonnie spent the first decade of her career in the UK where she earned her MBA, led the financial and operational planning of a multi-million dollar acquisition, and worked with executive teams to streamline business processes. Bonnie loves helping business owners earn the right to implement the fun stuff. Now back in her hometown of Milwaukee, she’s taking on the world of digital.more posts by Bonnie →