When I started PARAGRAPH back in 2005, I was a 27-year-old with a lot of big ideas but no clue on how to run a business. There’s no reasonable explanation on why we’ve made it this far other than some timely course corrections and a few lucky breaks along the way.
Starting a business is often glamorized to the point that even the to-do list for want-to-be entrepreneurs all sounds really exciting. But actually, it’s a lot of hard work and the reality rarely lives up to the fantasy.
So whenever a friend considering launching their own business reaches out and asks me for advice, I skip over all the sexy stuff and get to the hard lessons that I wish I someone had taught me when I first started.
You might have the best money-making idea in the world, but a great idea isn’t enough. Do you have the network, the resources, the connections and support needed to make the business successful? Figure that part out before you open your doors for business, not after.
On day one, track everything. Not just revenue and expenses. But close rates on proposals. Profitability on a project level. Fluctuations in overhead expenses. How your hours are spent. (Yes, this means filling out time sheets.) Seems like overkill, especially if you’re a solopreneur. But you can’t learn what works and what doesn’t if you don’t have the data. Over time as you grow, you’ll eventually understand the importance of doing all of this but if you start doing it from day one, you’ll speed up your learning curve significantly.
If you sell your time and expertise, this may just be your first 10 clients. If you sell products, this may be your first 1000 customers. Whoever and however many they are, give them exclusive content, set them up on some sort of retainer or subscription – even if at a significant discount. And give them plenty of personal attention especially as you grow and bring on new clients. These initial customers are your foundation and their recurring revenue will bring the financial stability needed to go out and hunt for more business.
If you’re considering starting your own business, you likely have plenty of smarts and initiative. But your innovative business idea will likely include elements that may be ahead of their time or simply don’t resonate with the marketplace. The market will quickly tell you what’s valuable – and what’s not so valuable – about your offering. Listen and don’t fight it. Of course, don’t blindly cow-tow to the whims of the customer and redesign your entire business model based solely on customer feedback. But at some level, you have to be okay with the market defining you (and the role you fill for them) and shifting your proposition and offering accordingly.
These four things may not be what gets people excited about starting their own businesses. But you can’t get to the exciting stuff if you don’t acknowledge and embrace these fundamental principles first. And I’m convinced that if I knew these things 13 years ago, it would have saved me a lot of headaches.
Any other advice my fellow business owners would add to the list?