So you are ready to start your own business? You’ve brainstormed your business idea, spoken to friends and family about your plans and are ready to leave your full time job to work for yourself and start realising your dreams. So, having read numerous books, blogs and articles on entrepreneurship you are standing on the ledge about to plunge into the unknown. Wait! Just a few seconds. Familiarise yourself with some of the misconceptions of starting and successfully running your own business.
Opportunity is missed by most people because it is dressed in overalls and looks like work. – Thomas Edison
Demystifying the Myths
Misconception 1: You Need To Be Niche
You have to reinvent the wheel. You have to be another Facebook or Apple. You have to bring an incredible, never-before-seen differentiation point, product or service to the market that will outwit and outsmart your competitors all of the time. No! You don’t. The sad reality is that a ‘niche’ does not guarantee success, and it won’t save your business from failure either. Your business should be built if you have a valuable product or service at a reasonable price that potential customers want to buy. Period! Don’t reinvent the wheel. Some of the most successful businesses have a similar product/service than their competitors. They just do things a little bit better, offer a little bit more and satisfy a few more customers.
Misconception 2: You Need To Have Unlimited Confidence
Should you enjoy being at the center of attention? Should you be an extrovert or social butterfly? Should you like speaking in front of people? The answer is no to all these questions. It’s natural to doubt yourself when it comes to promoting your business, new products or services or ‘sell yourself’ as an expert. Starting a new business is about getting out there and doing it anyway, even if the fear, worry, and doubts outweigh your confidence.
Misconception 3: You Will Become an Instant Success
Unfortunately a lot of prospective young entrepreneurs think they will become an overnight success. I’ve got news for you! These young entrepreneurs are inspired to start their own business by witnessing individuals that are currently successful. They study the success story instead of the origin of that success story, which often includes massive struggle, long hours, tears, anger and a roller coaster of emotions prior to the breakthrough. Truth is, it takes at least 7 to 10 years to become an overnight success.
Misconception 4: You Make Your Own Hours
No you don’t! If that is your point of view, then rather stay in your 9 to 5 job. Your boss makes the hours but at least you know what hours you are expected to work. I’ve lost count of the number of times people have told me how great it must be for me to run my own business because, as the owner, I get to make my own hours. What they don’t realise is that since it is my own business, it’s incredibly difficult to ever turn it off – something I am personally trying to work on. During the first 2 years of starting my own business, I worked on average 18 hours a day, 7 days a week. So, get ready to answer emails at 1 am in the morning, to meet clients at 6 am in the morning, field a Skype call at 7 pm at night or taking a call from a prospective client during a rugby game at 5 pm on a Saturday afternoon.
Misconception 5: You Are Rich, Sexy, Unstoppable and Taking Over the World
Entrepreneurship is not sexy! Entrepreneurs don’t get rich instantly nor are they unstoppable. And most certainly, they don’t take over the world. In starting your own business you will meet a client, make your own coffee, do all the administrative work and knock on doors for business. Wearing all the caps and transforming yourself by taking on various roles is part and parcel of the challenge. In most cases you won’t be able to pay yourself for years. If you want a guaranteed salary, stick to your day job! Don’t focus on taking over the world – rather focus on improving the industry bit by bit or making a small mark in the lives of a few people (customers).
Misconception 6: Starting a Business Comes With Complete Freedom
The biggest lie is that running your own company allows you to set your own hours and gives you total freedom. If you want to start your own business for freedom, think again. The freedom that comes with starting a business is the opportunity to get your business idea implemented and the joy of watching your business take shape and solve real problems people have with time. Of course you have the freedom to change direction as you deem fit but most your time will be taken up by meetings, appointments, events and everything else required to successfully run a new business.
Misconception 7: You Need Lots of Money to Get Started
In the current age of abundance of free business resources, you can start a business with little or no money. You don’t need the help of an investor. There are hundreds of free resources, tips and blog posts about bootstrapping your business that you can access. Funding in any case is no guarantee for success.
Misconception 8: You Will Attract Lots of Customers from Day 1
No you won’t. Most start-up businesses I work with only make their first sales after 6 months of starting the business. Plan for the worse but expect the very best. Most businesses fail because they’ve made plans based on exponential growth right from the beginning. You shouldn’t expect customers to flock to your business, even if you think you have the greatest idea in the world. Never stop marketing and make sure you have enough money to continue marketing; just in case some customers find it difficult to find you.
I’d like to leave you with a few other considerations of starting and running your new business.
Partnership or Solopreneur?
Let’s be honest, business partners, like parents and spouses, are rarely perfect and comes with their own set of challenges. Deciding on whether to take on a business partner is a very important decision that you might have to make. If you made the choice that this is the way to go in taking on a partner, the first thing to remember is to not choose a partner who is exactly like you. A truly effective partner is someone with abilities and skills that complement your own and can expand what you can do as a team. Also ask yourself the following questions:
- What do you need and expect from a Business Partner?
- What is your potential partner’s financial situation?
- Is the potential partner’s commitment to the business as strong as yours?
- Is there something in your potential partner’s family life that might make the business a secondary interest?
- How does he or she react in difficult situations?
- What is the potential partner’s standing in the community?
- Are they willing to put everything in writing?
Planning for Roadblocks on your Path to Success
In order to plan for success, you need to first realise and identify what the potential roadblocks you may face are. A study by the World Bank has found that the vast majority of small enterprises in South Africa report that difficulties gaining access to credit represent a major constraint to new investment, a key determinant of growth in SME’s. In this respect, according to Kongolo (2010), the conditions set by most financial institutions to acquire credit/loans disqualify most applicants from getting needed finances. These limitations disproportionately affect small businesses given their scarce financial and human resources. In my discussions with prospective entrepreneurs I have identified the key factors these individuals feel are their greatest barriers to starting a small business in South Africa:
- Insecurity in whether the product or service will work and if there is a market for the product and service.
- Lack of enough start-up capital and time to work on the business idea, especially if the prospective entrepreneur is employed on a full-time basis.
- Lack of business management skills, financial literacy and technical competence.
- Leaving a full-time job and the associated loss of benefits (e.g. medical aid, pension fund, fuel allowance, etc.) as well as trading a guaranteed monthly salary for possible no salary during the initial start-up phase of the business.
- Inadequate knowledge of and experience in the intended business venture or industry coupled with ignorance of the challenges and risks associated with starting and managing a small business.
- Lack of support from family and friends and pressure from parents and family members telling you “You can’t achieve your dreams” and “You need a full-time, permanent job”. Additional (negative) pressure from social groups further underpins the fear of failure and to be rather content with the status quo.
- The administrative (non-sales generating) function and paperwork associated with starting a new business. Evidence from dealing with prospective entrepreneurs are that one of the most important functions they do not focus on is adequate bookkeeping, which from further investigation is primarily due to a lack of financial management skills.
- Starting a new business is a ‘lonely experience’; going at it alone isolates you. This is a concern to most prospective entrepreneurs, especially if they plan to start a new business from home. Most prospective entrepreneurs do not have access to a mentor that can empathise with their emotional and physical reality of starting and managing a small business.
These fundamental factors ultimately influence an entrepreneur’s performance when faced with obstacles and challenges and could prove to be either their biggest strengths or most difficult challenge. This being said, at least you can now plan for these potential obstacles and not be caught off guard when they occur. And yes, they will occur!
If you’re trying to achieve, there will be roadblocks. I’ve had them; everybody has had them. But obstacles don’t have to stop you. If you run into a wall, don’t turn around and give up. Figure out how to climb it, go through it, or work around it. – Michael Jordan
Failing is not Failure
Entrepreneurs fail constantly and daily! That’s right. You could say it’s a never-ending trend. Entrepreneurs, whether they’re poor, middle class, millionaires or even billionaires, just keep on losing. That’s the real state of entrepreneurship. If you want to go into business for yourself, get ready for feeling failure and pressure about 90% of the time. With this said, take cognisance of the following when failure presents itself to you:
- It’s unavoidable. The best people and businesses in the world fail, and that’s why they become great at what they do. If we succeeded at everything, all of the time, we really wouldn’t learn anything and without learning we would never progress forward.
- It’s not the end of the world. Sometimes we get caught up in the fear of failure that we end up making rash decisions and even more mistakes. Every time that I fail at something I get out to the gym to punch a boxing bag and switch off from everyone and everything for an hour. This hour allows my brain time to digest the situation and calm down. Believe me, you can see things way more clearly of you are calm.
- Write it down. I have a notebook in my car, on my desk and next to my bed. I use it to pencil ideas, things to do and my failures. Reading through the list allows me to replay the situation and reason for failure in my head with one goal: to learn from the mistakes I made.
- Doubt is the ugly cousin of denial. Know that everybody fails. Most people I know will never admit it because society would let us believe it is a sign of weakness. When I was younger (and even as I get older), when I failed at something, I started to doubt my ability, my talents and my environment. It is only after years of being on a path of constant learning that I realised there is nothing that you can fail at that somebody hasn’t failed at before. Denying failure is failure in itself. Learning from failure is the first step in the right direction. Brace yourself…failure is a part of life. Accept it and learn from it.
- Don’t make it personal. Separate the failure from your personal identity. Just because you haven’t found a successful way of doing something doesn’t mean you are a failure. Personalising failure can totally damage your self-confidence and self-esteem. Don’t allow it! What’s more, decide who to listen to and who to avoid. Not everyone is out there with your best interests at heart. Try and suspend feelings of anger, frustration, regret or blame. And most importantly…don’t dwell on it and never, never, NEVER give up!
Failure should be our teacher, not our undertaker. Failure is delay, not defeat. It is a temporary detour, not a dead end. Failure is something we can avoid only by saying nothing, doing nothing, and being nothing. – Denis Waitley