Have you ever considered starting your own business? It seems to be the dream for many people. To own something that belongs to you. To be the boss. To have more freedom. And hopefully, the chance to strike success in a big way and make a lot of money doing what you love.
As a corporate executive turned entrepreneur myself, I must say that there is definitely something rewarding about owning a business. But, once you make that decision, there are some things I want to share with you beforehand to help make your transition as successful as possible.
Top Tips on Starting a Successful Business:
- Get a line of credit now!
Before you resign from your current role, apply for a line of credit. You will qualify for a lot more money while you hold down a steady job versus as a new entrepreneur. These funds will come in handy when you start your new business. Also, this money will provide you with some extra security in case you don’t make any profit in your first few months (yes, that often happens for new business owners!)
- Three is the magic number.
The majority of people who start businesses will tell you that the first three years of business was the most challenging and frustrating. You will likely make the least amount of money in this time too. I tell clients to consider the first three years a time to play and experiment. Know that when you make it past the first three years, chances are your business will succeed the long haul and generate more income.
- Set away a nest egg before you jump ship from your current role.
For me, I found saving $50,000 was what I needed to do. This provided a safety net for a few months (always your first go-to place before the backup line of credit) and then I also needed money to start my business (i.e. website, marketing materials, training courses, office, etc.).
- Prepare to work hard.
Despite the freedom I have available to me as a business owner, I work harder in this job than I have in any role in my entire life. The decision to work hard is of my choosing and I actually enjoy almost every minute of it. But it takes hard work to be a success. I don’t know any successful entrepreneurs who can “luck” their way into making millions.
- Get a coach.
When you start out on your own, this will be the time in your life when you may feel you have the least amount of money. But, hiring a coach is a must-have for any business owner. First of all, it can be an isolating change starting your own business. In the corporate world, we have teams and lots of people to bounce ideas around with. When you start your own business, it can be lonely. A coach is a trained professional who can help you get your business off the ground and running successfully in a lot less time.
- Be prepared for the tough days.
You will receive rejections. You will have customers that you thought were a for-sure thing fall through. That is the reality of business. Don’t take rejections personally in business. Everyone needs to do what is best for them. And often when one door closes another one (perhaps you didn’t even see this door before!) will open. It is really part of the fun of business.
- Consider investors.
Depending on the type of business you want to invest in, it may require extra capital. Research potential investors thoroughly and talk to other people/companies they have invested in to learn if they are a hands-off or hands-on investor. Think about what kind of investor you want. Also, consider how much equity in your company you are willing to give up. If you give up more than 50% to an outside investor, you own the minority share and you will lose some control over your company. Perhaps in this case, you may want a few investors so they can each take a smaller piece of the pie and leave you with the majority control. If your venture requires a large amount of money and you have to deal with majority investors, hire a good lawyer and negotiate a buy-back clause in your contract. This will give you the option to buy back majority equity in a certain number of years for a set price.
Blogger Carey-Ann Oestreicher, MBA, BA (Hons.), Chief Engagement Officer, Potential Unlimited
Recipient of a Top 40 Under Forty Business Achievement award, Carey-Ann Oestreicher, owner of the career development firm for women, Potential Unlimited (www.potentialunlimited.ca), holds a MBA and has worked in a variety of senior positions including vice-president level. Her focus is her family and helping women in business find true peace and happiness in their lives while achieving new heights in their careers.
Carey-Ann has been featured in a variety of media because of the success she has experienced with her holistic approach to developing women leaders and entrepreneurs. Her appearances include: CTV’s Canada AM, TSN, CBC News, Global Television, City TV News, The Globe and Mail, Canadian Business magazine, The Toronto Star and The Canadian Press.