Are You SURE You Want To Start Your Own Business? Part Two of a Series
Why, exactly, do you want to go into business for yourself?
- Is it because you cannot stand the thought of working for an uptight, demanding, and perfectly dreadful boss?
- Is it because you cannot bear the thought of going through another downsizing or restructuring, knowing that your job could be on the line?
- Is it because you want to be your own boss, call your own shots, or see more up side in your earning potential, with the possibility of financial self-sufficiency?
These are all good reasons for wanting to go into business. In fact, studies have shown that many entrepreneurs get their start due to some life-altering experience such as losing a job or finally walking away from a dead-end job or a demoralizing work environment.
It is amazing how creative, resourceful, and innovative you can be when, finally, you reach the edge and find yourself in a survival situation professionally. In times like this, the entrepreneurial spirit comes alive and you figure out that you can simply do it on your own.
Does dissatisfaction alone in some area of your life constitute reason enough to venture into business and the life of entrepreneurship? Many potential entrepreneurs get to this bridge and never cross because they do not know how to discover and unleash the entrepreneur within himself or herself.
Many people resist giving credence to their entrepreneurial tendencies no matter what the circumstances, ignoring the potential for self-expression, independence and the fulfillment of their dreams. Herein resides the real tragedy. Many people experience paralysis from fear of the unknown and fear of failure. Consequently, they never pursue entrepreneurship and the potential freedom that it can bring to their lives.
Although entrepreneurship appears to offer many advantages for personal and professional growth and accomplishment, why is it that so many new entrepreneurs fail? In fact, studies have shown us that out of every 100 entrepreneurs who start their own businesses, 14 will succeed and a whopping 86 will fail in the first five years. The odds, so to speak, are stacked against you as a nascent entrepreneur. Therefore, if you are contemplating starting your own business you should take it very seriously.
The two biggest reasons people fail in a new business are:
- they don´t know what they are doing, and
- their business is undercapitalized.
When we say they don´t know what they are doing, we mean they literally don´t know what they are doing in terms of running a business day in and day out. It also makes perfect sense that a new business might be undercapitalized (not having enough working capital to run the business). In fact, many new entrepreneurs, who don´t know what they are doing have a hard time finding either equity or debt capital for the reason that lending institutions and savvy investors typically do not like to give money to people who don´t know what they are doing in business.
In order to improve your chances of beating the odds, what is important is that you educate yourself about business development. There certainly is enough information out there on how to start and run a small business. For instance, if you go to Amazon.com and type in a search for books on ´Entrepreneurship´´ alone, you will have over 21,000 book choices. Nevertheless, where does one start in deciding what to read, who to listen to, and what to implement?
In the more than 55 years of combined experience in the world of business that my wife and I have had, and working with hundreds of hopeful entrepreneurs, we discovered four basic stages to business development that every entrepreneur must go through to enhance their chances for business success.
- Reflect
- Envision
- Create
- Build
Most entrepreneurs, especially the 86 that fail, usually skip one or more of these essential stages of business development and find themselves in a heap of trouble before they know it. Typically, a new entrepreneur will get and idea (envision) and go straight to market (build). They simply unknowingly skip the ´reflect´ and ´create´ stages, and charge into business with an ´if-I-work-hard-enough´ attitude everything will be all right.
Well, statistically we know that not everything is all right and it does not work.
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