The good news is that anyone can start a business. The bad news is that starting a business that succeeds and continues to flourish isn’t so easy.
There are five resources you need upfront to start a business that has staying power. Business knowledge is one of course, but the other four are equally as important. To turn a startup venture into a successful business, you must be equipped to follow through as well as gain business-related knowledge and skills.
Fully Commit
Successful entrepreneurs are fully committed to their business ventures. You need to do the same. You have to put your heart and soul into what you’re doing, truly believe in your product or service, and be prepared to work long hours to get all the tasks done that are required to grow and sustain a business.
When you start a business, you have to be ready to make sacrifices, such as not having holidays or even a salary for what may seem like an endless stretch of time. And you have to do all this without the safety net that salaried employees are used to, such as benefits and pension plans, unless you pay for them yourself. In fact, you have to have a whole different mindset than an employee does.
Be a "Type D”
But just being able to make a commitment doesn’t automatically lead to business success. To create a profitable business that endures, you also have to be a "Type D” person—someone who has a desire for success coupled with drive, discipline, and determination.1
You have to not only have the business ideas but also be able to execute them, even when you run into problems. Successful business people are tenacious; obstacles are temporary barriers to work around, not roadblocks. They may take “no” for an answer, but they're constantly looking and asking for the people who'll say "yes."
Plus you need discipline and determination as these traits are what give successful business people the fuel to follow through on their business ideas and endure the ups and downs of the economic climate.
Desire, drive, discipline, and determination are all required for business success!
Get the Business Knowledge You Need
Business knowledge before you start a business is critical. All the drive and determination in the world isn’t going to help you if you don’t have the knowledge to run a business and don’t research and plan for your success appropriately.
Many people have tried to start a business without acquiring the business knowledge they need to make their business a success and, as a result, their businesses have failed.
To start a business, you have to be knowledgeable about many different aspects of business and have a variety of skills, or hire people who have the skills you lack.
If you aren’t knowledgeable enough about accounting to keep your own books, for instance, you'll need to hire a bookkeeper and/or an accountant. If your business is internet-based and you're not an expert in website development, you’d be wise to hire a company to design and maintain your website.
When you’re creating your business plan, one of your first steps needs to be a frank assessment of your skills and expertise. Which aspects of the business are you qualified or willing to handle and which will necessitate either getting informed or calling in outside help?
Areas you need to know about include:
Find Adequate Startup Money
Unless you have deep pockets or have saved in advance, you're going to need financing to start your business.
Finding adequate business start-up money is especially critical because there’s no guarantee that your business is going to make money right away, and often initial income is too low to live on. In fact, the lack of adequate funds is a top reason most small businesses fail.2
To get started, you need an initial capital investment--the total amount of money you need to open your doors for business and keep them open until sufficient ongoing revenue is produced.
You’re also going to need operating capital to start a business, which is the money it takes to keep the business going. Operating capital includes expenses such as salaries, wages, rent, business expenses, supplies, utilities, advertising, depreciation, and interest payments.3
A fast easy source of start-up money for small businesses is your personal assets, such as savings, including Registered Retirement Savings Plan (RRSP), pension funds, severance allowances, along with remortgaging a property, credit cards, and personal property.4 Even if you want a small business loan or investors, many will want to see that you've invested in yourself as well.
You can also borrow money from family, relatives, and friends, but avoid misunderstandings and bad feelings by always getting agreements about loans in writing and making sure that all loans are set up with proper security, terms and conditions, and a payment schedule.
The Business Support You Need
You may be in business by yourself, but no business succeeds without a good support system. As an entrepreneur, you need interpersonal skills, teambuilding skills, and leadership skills, as you'll need to work with others including vendors, employees or freelancers, customers, and other support resources to have business success.
When you're thinking of business support, look first to the home front. Your family should be your number one cheerleaders when it comes to your success. A supportive spouse can be there to listen to your ideas or problems and provide the encouragement or advice that keeps you going.
Your spouse may also offer direct business support, such as providing the capital needed to start a business or working in the company without pay to keep costs down. Spouses who contribute financially by working outside the business are also a common small business scenario.
Having a supportive spouse is especially critical if you want to start a home-based business. You can’t start a home-based business without considering what your family members think about the idea, what role(s) your family members might play in your business, and how your business is going to affect your home life. Without the active support of your family, your home business will fail. Talk out these issues with your family beforehand and explore how supportive your family is before you start a business.
Support can come from other sources including other business people who have been where you are and achieved what you're striving for. Talking to other successful business people help you avoid pitfalls and provide insight into what works and what doesn’t.
If you can’t find someone locally to talk to, there’s an ever-growing network of business communities online where you can get the information you need, and sometimes good advice, too. You can get a free mentor through SCORE, which also offers webinars and courses. A final option would be to hire a business coach.
You may be in business by yourself, but you don't have to be alone. Build a support team that can provide you with motivation, inspiration, feedback, and knowledge.
Are You Ready for Business?
Before you start your business, check that all five of the above resources are in place. Your commitment, determination and other Type D traits, along with proper funding, business understanding, and support, will be the foundation for your successful business.
