This is kind of a simple thought. You wouldn’t become a landscaper without having a good knowledge of horticulture. You wouldn’t become an accountant without studying the subject and passing a few tests and certifications. You wouldn’t become a broker-dealer without getting the prerequisite training. You wouldn’t take on any major undertaking in your life without really studying what it is all about, would you?
Well then. You shouldn’t become an entrepreneur and start a business without really being prepared either. There are a few things you ought to know from the very start:
- Do you know how to do it?
- Do you have what it takes?
- Are you prepared for all outcomes?
Are you educated in entrepreneurship?
Starting a business without having the prerequisite knowledge of how to do it will undoubtedly lead to failure. You will make too many death-defying mistakes. They will eventually catch up to you and you will then run out of energy and money.
It doesn’t matter how much you think you know about this subject. Get engaged in a solid entrepreneurship education program that teaches you the hands-on details of how to do it. If you are already experienced in business, it will serve as a reminder of what you need to be doing and help you validate what you think you know about your business idea. But, if you are a first-time entrepreneur, this is a must.
Consider the Six Steps to Success entrepreneurship education program that is offered by Bunker Labs RDU and EntreDot. Here you will learn the very important disciplines of business and how to perform them in your business while working on your business. What you really have to be super-smart about is: Clearly knowing the premise for your business, the problem you solve and your solution for it, or the opportunity you are pursuing and what you offer
- The complete market ecosystem in which you will have to operate
- How you will win against all competitors
- Everything about what makes your buyer (customer) tick
- The quantitative benefits you bring to your customer
- How you will prove that your business concept works
- A well focused and precise marketing and sales plan
- How you are going to fund your business
Even if you have some experience as an entrepreneur, or have been part of an early stage business, or have already written a substantial part of your business plan, or have an early version of your product/service in the market, you should consider engaging in an education program that helps you validate what you think you already know. This would be time well spent making sure that you are addressing all that is needed to prepare your business for the market, and to focus and refine your approach to your business, especially if you intend to raise money from investors.
Is this the right thing for you?
There are all sorts of “ Entrepreneur Readiness Assessments” available. Just do a Google search using these words and you will find a few hundred thousand of them covering all sorts of aspects of the question.
But, what you really want to know from the very beginning is that you pretty much have the mindset of an entrepreneur and you have the support structure that will allow you to do it.
You should figure out whether or not you are prepared for such things as:
- Relying on your passion for being an entrepreneur and for your business; sometimes it will be the only thing that keeps you going
- Working long hours and late nights; the 40-50 hour work week is over; think 60 and above, plus some homework over the weekend
- A significant financial commitment to get started; starting a business is not free as many people hope
- Having the energy and drive to make things happen; kind of goes with long hours, but the time spent has to be well focused
But, that is all about you. What about how this all fits into your life and how it affects other people in your life that you care for and who care about you? You will have to take stock of having the support of your family and close business associates. They will have to know, accept and support what your business intentions are. Without their backing, you are in for a lonely experience. Have discussions with them about:
- The financial role and obligations each plays in the family
- How support for the children would be managed
- How you would handle the changes in your lifestyle
- The family objectives to be achieved from your business
- How you would support each other
Are you ready to succeed, or fail?
Every entrepreneur has to believe they will succeed. That’s not terribly profound, but you should have some idea what that looks like. After all, it is what you are striving for and are about to sacrifice money, other personal goals and family time in order to succeed. Take some time to map out what success looks like and kind of when you want it to happen for your business:
- What is a financial success? How much, when?
- What social purpose will be fulfilled and when?
- What other objectives are there? New industry experience, new leadership/management challenges met, new professional relationships established, and more
But, what if the business fails. What is the downside of it all? What you have to do is a separate business failure from personal failure. As most of you realize, most businesses are going to fail. The angel capital investor world even counts on it. They know that a little more than 50% of their investments will be a dead loss. Another 20% will be kind of break-even. That’s in the technology and life science sectors. The small business world is far worse. Businesses fail for lots of reasons, the primary ones being:
- The market was not sufficiently understood
- The business model was not thoroughly thought out
- Market trends drastically changed
- New competition took over the market opportunity
- Marketing and sales were executed poorly
Nobody is a perfect oracle on the subject. Chances are, your business will fail. So, what if it does? Is there anything of benefit coming to the entrepreneur and the entire team that worked on the business? Talk to any seasoned entrepreneur. Ask them if they have ever failed. The honest ones will tell you, “heck yes!” Then ask them what was it like and what did they do next. Better yet, ask them what they learned. You should hear some of the following learning experiences they gained, and others, that made them an even better candidate to try it again:
- I didn’t understand all the influencing factors and trends in my market
- I really underestimated what my buyer’s purchasing preferences and processes were
- My product/service really had to be integrated into a more comprehensive solution that should have been offered through value-added partnerships
- My consumer retail product just didn’t get traction because I really didn’t know much about the buyer’s purchasing preferences
- I didn’t have the customer support structure in place and got buried in overhead costs that I didn’t plan for
- And, the list goes on…
The point is, even in business failure, there are valuable learning experiences that you will carry with you for the rest of your life. You will learn from others’ failures as well. Take the learning experience to heart and practice, and be a better businessperson in the next business you start.
Be an educated entrepreneur
Like for any endeavor in life, you need to get really smart about your next step. Starting your own business without determining if it is the right thing for you and getting the necessary knowledge about how to do it, is like entering the boxing ring without any training. You will get put on the mat.
In the Six Steps to Success entrepreneurship education program, you will get the education you need as well as the mentoring to guide you through the planning, launching, and operations of your business.
About the author:
Bill Warner is the Cofounder and Director of EntreDot, a non-profit organization that provides entrepreneurship programs that help entrepreneurs start and operate their own businesses, and a member of the management team of Bunker Labs RDU. He is the Managing Partner of Paladin and Associates, a business-consulting firm in Research Triangle Park, North Carolina, and is a Fund Executive of the Inception Micro Angel Fund of Research Triangle Park (IMAF-RTP), an angel investor seed fund that invests in technology and life science companies.