You Can Be an EntrepreneurApril 8, 2013
If you’re not sure you have what it takes to start your own business, ask yourself a few of the following questions: Are you independent? Disciplined? Do you learn from failure or get discouraged? Are you willing to work more than a 9-to-5 day, especially at first? Can you afford not to draw a salary for at least the first six months?
If you answered yes to these questions, and you have an idea that you’re passionate about, here are some steps you can take toward your goal.
Seek out those who have already done it: Check out Internet groups, universities and alumni associations for mentors or just someone you can get advice from. SCORE includes a mentor network of more than 10,000 mostly retired entrepreneurs throughout the country. You can search by related background and meet the mentor locally or by email. You get feedback online from thousands of peer entrepreneurs at YoungEntrepreneur.com.. Ladies Who Launch offers online workshops for entrepreneurs. You may even wind up partnering or hiring someone with the expertise to complement yours, which leads us to the next tip.
Partner with someone who has skills that you don’t: As Spanx creator Sara Blakely puts it, “Hire your weakness.” Blakely’s company was about to take off after getting much publicity, but she had no formal business background. So Blakely brought in former Coca-Cola Company executive Laurie Ann Goldman, who was the leader of its worldwide licensing division.
“We're very different people but we think very much alike,” says Blakely. “We usually come out at the same place and if we don't, there's a healthy debate that goes on. Ninety percent of the time, she executes the same way I would, but better."
Write up a business plan: This doesn’t have to be hundreds of pages. It can be one or two pages, depending on how much money you’re going to need or how complex your idea is. The plan should include how much you plan to charge for your product or service and the size of your potential market. Also, give an overview of your competitors – who and how many there are and how strong they are, and your strategy for fitting into their market. Include estimates for startup costs, projections for sales and profits, a break-even analysis and long-term goals for the company. Find inspiration from sample plans at www.bplans.com.
Find the Money: Experts advise overestimating the amount of money you will need at the beginning because it's easier to raise funds before the launch than it is after you've failed to meet projections. Also, to minimize risk, limit the amount of personal money that you put into the business, and try not to use credit cards as this is the most expensive kind of debt.
If you can’t get a loan from the bank, ask the lender how you might improve your plan so you can try again. If your credit history is too short, try turning to friends and family. But be careful to set up the loan like a formal business transaction that explicitly states when it will be repaid.
Look into special types of loans. The U.S. Small Business Association offers loans and grants for women entrepreneurs and veterans as well as other special programs. SBA.gov loans
Come up with creative and cheap ways to market your product or service: Start with Facebook and LinkedIn and create your own website. Before deciding on a name for your business, make sure it’s not already taken as a domain. Google's Ad Words program is an affordable and measurable way to attract visitors to your website. You can sign up for free and set a budget for how much you want to spend to appear in search results.
One way to gain attention is to ride the coattails of the already-famous. Tory Johnson, who founded Women for Hire, which organizes career expos for women, used creative marketing to get her new company off the ground. “I knew the importance of establishing immediate credibility,” she says. “I'd be targeting human resource professionals to use my services, yet nobody in human resources departments knew my name. My company was totally unknown.”
Johnson bought 100 books by View co-host Starr Jones and asked her to sign them at her first expo. She also formed a marketing partnership with Mademoiselle magazine to distribute the publication to career fair attendees. “Those two names -- Starr Jones and Mademoiselle -- were very well known,” she points out, “even though I wasn't, so I benefited instantly from that borrowed recognition.”
Other creative ideas from Johnson: she encouraged someone starting a pet massage business to partner with pet stores in the area to offer on-the-spot massages. Someone wishing to start a bakery might offer to do fundraisers for her kids’ school or visit wedding vendors and suggest offering affordable cakes for new brides.
DON’T GET DISCOURAGED: Yes, this fits into one of the successful entrepreneurial traits, but everyone gets discouraged once in awhile. Let the feelings pass, and keep in mind what Spanx founder Sara Blakely’s father taught her: “My father used to ask my brother and me what we had failed at recently and then congratulate us. He did complete reverse psychology on us. Failure was something we sought out and not this scary thing. I think many people are debilitated by the fear of failure, so he gave us a real gift.”