Originally published February 2, 2015 on Sootoday.com
“Building a business is not rocket science; it’s about having a great idea and seeing it through with integrity.” – Sir Richard Branson
As the tremendously successful entrepreneur, Richard Branson states in the above quote, starting and building a business isn’t rocket science — in fact much of it is common sense, luck and the ability to see opportunities that others do not.
According to Dr. Michael G. Goldsby, Professor of Entrepreneurship at Ball State University, “Entrepreneurship is fundamentally about seeing what is missing from the world and then figuring out a way to make it better. Great entrepreneurs see problems as opportunities. The best way to create a successful business is to solve the problems of their customers.”
Successful entrepreneurs take risks. They are not afraid to fail, and many entrepreneurs fail numerous times before becoming truly successful. These “failures” are seen as opportunities to learn what not to do next time. In Silicon Valley, the home of Facebook, Google and many others, entrepreneurs see their failed businesses as a badge of honor – and even investors view them as invaluable experience.
Although risk-taking is one of the qualities of successful entrepreneurs, you can minimize your financial risks by starting your business on a part-time basis and keeping your day job. Often times you can operate a home-based business, until you prove your concept, or build your business to the point you are ready to expand.
This will allow you to grow your business slowly, keeping things manageable, and utilizing minimal resources. I know a number of entrepreneurs who operate successful part-time businesses, including photographers, web designers, and consultants.
I run several businesses of my own on a part-time basis, and of the six businesses I have started in my life, only one of them started out as a full-time business. I am a big fan of “bootstrapping” your business, which means starting and growing a business on a small budget, utilizing inexpensive and often free methods for marketing your business, and gradually growing and reinvesting in the business over time. By not incurring debt to start the business, there is less risk involved and your biggest investment is your time and effort.
Some of you may have heard of the concept of “Lean Startup”. While much of it applies to the software industry, the essential take away is to get your product to market as soon as possible for the lowest cost possible. The idea is to launch a “minimum viable product” – one that isn’t perfect or ready for prime time, but one that works and you can utilize to get feedback from customers.
You will use that feedback to improve the product to one that is ready.
In other words, get to market as quickly as possible with a product and then improve the product from the feedback you receive. We see this process occurring all the time online – where companies often release software or apps for free, build large user bases, collect feedback and improve the product over time. Through this process, they prove their ideas are marketable, build significant user bases, and eventually release a paid version to generate revenue.
Startup Sault’s December book club featured Chris Guillebeau’s best-selling book, The $100 Startup: Reinvent the Way You Make A Living, Do What You Love, and Create a New Future. The book features interviews with thousands of successful entrepreneurs who have started microbusinesses — businesses they started for a couple of hundred dollars. What he finds is that many of the entrepreneurs followed a similar pattern, “get started quickly and see what happens.”
Guillebeau is an advocate of this method, and adds that “there’s nothing wrong with planning, but you can spend a lifetime making a plan that never turns into action. In the battle between planning and action, action wins.” So while planning is important (failure to plan is like planning to fail, as the quote goes), many entrepreneurs are moving away from developing full business plans before starting their business.
Many practitioners are promoting the concept of focusing on developing the business model rather than spending time writing a business plan. Others are resorting to one-page business plans that answer the essential questions about the business, while skipping over much of the detailed analysis and planning.
Because a lot of new entrepreneurs find the thought of trying to write a full-blown business plan as daunting, these alternatives provide the opportunity to plan your business while not getting too bogged down before you even begin.
So don’t get discouraged if you don’t know where to begin. “Anyone can come up with a great business idea if they are willing to take the time to learn the right skills and build the right toolkit to get it done,” says Dr. Goldsby.
And building the right toolkit is accomplished by learning everything you can about starting a business, and accessing the expertise and resources available to you at local organizations like the Sault Ste. Marie Economic Development Corporation and Sault Ste. Marie Innovation Centre – both organizations provide business counseling and advice, access to training and resources, and even funding programs to start or grow your business.
Connect with other entrepreneurs by attending Startup Sault events like Startup Drinks and Startup Book Club. The SSM Chamber of Commerce offers networking opportunities through Take Five. You never know who you will meet at these networking functions – competitors, future customers, successful entrepreneurs, even potential business partners.
Take advantage of the available resources and do your homework – this will go a long way to set yourself up for success.
So what is your big idea?
Join us next time when we will talk about starting your business on a budget, and promoting your business using free or low-cost marketing tools and mediums.