People who know me know that I am generally an optimist. And I enjoy helping people get where they want to go in their careers and their lives. That's what coaches do. But when someone says, “I’m thinking about starting my own business”, my reaction is always the same: “Are you sure?”
If you’ve read “The e-Myth Revisited”, you know that most entrepreneurs imagine their lives as business owners quite differently from what turns out to be the reality. Short of an infusion of cash that, at least temporarily, removes one huge headache, those who venture out on their own are in for some rude awakenings.
First, you’re responsible for everything. Let that sink in for a minute. My rule was, “if I don’t do it, it won’t get done,” and that is certainly true at the beginning. Those who have become accustomed to ample resources that help them get things done will need to learn a bunch of new skills right away - or have the cash to pay other people to do it. Most times, you’ll be tempted to save your cash and do-it-yourself.
Next, you will no longer have the benefit of the clout you acquired in your corporate life. Without a well-known company name behind yours, you won’t get easy access to decision-makers; you won’t get fast responses, and you won’t feel that warm corporate allegiance and identity an employer gives you. Eventually you’ll form a new identity, but it takes time. Put that on your list of things to do: Create a corporate identity and get people to care about it.
One old saying about entrepreneurship has certainly been true for me: The highs are higher and the lows are lower. With a limited financial cushion, almost no clout, and limited expertise, most entrepreneurs need to dig deep most days. Rejection and delays happen; world economies tank, and prospects change their minds or lose their budgets.
Do you need some slick collateral, a fancy website, and the means to travel for business development purposes? What about technical and administrative resources to help you make all this stuff happen? Guess what – that’s all you. How many hours are there in a day again? Not enough. How many hours can you work without losing your mind? Plan on 10,12,14-hour days for months on end. Scared away yet?
If you are fortunate enough to get an injection of cash and access to expertise, that’s half the battle. Most new entrepreneurs don’t have these things. Serial entrepreneurs learn this lesson early: You need cash and you need some expertise you don’t have. First time entrepreneurs are boot-strappers. They are working in their pajamas until 2 or 3 pm before they realize they haven’t eaten, brushed their teeth or dressed for the day. They struggle constantly with prioritization. They push themselves in ways they never expected to. Forget about your comfort zone. Most fail. So why is it so alluring?
For many years, (starting way back in 1984), I have worked for and around entrepreneurs. I finally took the plunge myself in 2004 with no large injection of cash. There were so many things I had never done, and I made mistakes. I wasted money (my own, not investors'), and actually got traction for 3 years before the “Great Recession.” In 2010, things picked up where they left off, thankfully.
One thing I've noticed: entrepreneurs are truly a different breed. And within that breed, there is one huge differentiator: money. People who start out with a big bank account full of other peoples’ money are one subset. Those who have a portion of their life savings they are (somewhat) willing to lose are another. But regardless of their access to capital entrepreneurs must have thick skin, be dreamers, and be smarter than the average bear.
For me it’s uncharacteristic, but I don’t always encourage people to start their own business. When people say to me that they’ve always wanted to, and they have a great (untested) idea, that’s all well and good. But do they have the means and the constitution to move to the bottom of the ladder at their age and go it alone? There are big realities to understand, and in my experience, most dreamers underestimate them.
There’s no shortage of advice on starting and running a business. One could spend months just reading all the advice out there, then many more months deciding which to believe. It’s foolhardy to advise people to “just do it” when the fail ratio is so high. Better guidance should come in the form of questions, starting with the first one: Do you really know what you’re getting into?Bottom line: Would I do it again? Definitely!