Rushing to entrepreneurship can be awful. Last post, we began a discussion on starting a business with a litany of reasons not to do it . . . or at least to go slow. Here are a few more to consider with a note of encouragement at the end.
- Don’t start without enough capital – Four of five businesses fail in the first five years because of a lack of capital. Being able to raise capital is a ‘litmus test’ for your idea. I once sat with a guy who ran up $56,000 in credit card debt trying to start a business. It didn’t work and he was all alone. He’d chased his idea without getting counsel from anyone. I’m betting he’s still paying off that debt. And what is ‘enough’ capital? Take your revenue forecast, cut it in half. Double your expenses. Now you’re a lot closer to reality.
- Don’t build your venture around your people – Build your team around your venture. You’ll always be ‘people away from your objectives.’ None of the 30 startups I’ve been involved with ended up doing what they started out doing. As the business morphs to stay alive and vibrant, your people needs will change. Try not to hire people you can’t fire . . . like relatives. Remember ‘structure follows strategy.’ Build your strategy, then develop your ‘people plan.’ Get the ‘right people on the bus’ for now but stay flexible.
- Don’t ignore your ‘wiring’ – Starting a business is harrowing. You must have a high tolerance for ambiguity and uncertainty. There’s absolutely nothing wrong in working for a good organization owned by others. Entrepreneurship isn’t for everyone . . . being a ‘fish out of water’ is no fun for the fish nor his family and friends.
- Don’t do it without your wife’s full support – If you’re married, you must be on the same page with your wife about the financial and relational demands of starting a business. She has to ‘sign on’ for the risk and the demands on your time and energy. You need a secure home with 6 months of expenses in the bank and enough life insurance on yourself so your wife and kids are taken care of if you keel over from the stress of the startup.
Personally, I have no idea how anyone starts a business without faith in God. Knowing He’s with you regardless of the outcome gives courage and confidence . . . key ingredients for peace (and sanity) while involved in a startup.
One last caution . . . be very careful ascribing your business idea to the Lord. I’ve heard more than one sad story of failed ventures that began with “God gave me this idea.” I can’t say which ideas come from Him and which don’t. We’re 10 years into a startup I was absolutely sure came from God. Who knows what will happen in the future but up to this point, it hasn’t happened how we’d hoped.
Now that I’ve given you these criteria and cautions, let me say there’s nothing quite like starting and running your own business. The relationships you’ll develop with your team, your customers, and supporters can be golden. Your faith will grow deeper and more essential . . . your prayer life more authentic and desperate. Raising teenagers is the only thing that’ll keep you on your knees more.
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