Friday, January 9, 2015

High Risk, High Reward

My brothers recent blog post inspired me to write a "counter-post" from my view.

If you don't want to read the whole article, he basically highlighted his findings and tribulations for starting a new company, which he attempted in 2008. Although I have virtually NO entrepreneurial experience, I have some educational knowledge and a whole lot of exposure via my entrepreneur boyfriend to the world of owning a company. I'd like to share my thoughts.

First of all, there are many different categories of businesses, so comparing John Deere to Apple to Nana's Corner Store is as far apart as comparing can come apart from general business principles. However, in Economics, we are all familiar with the phrase "goods and services", so I like to begin there with a dividing point for businesses; 1- businesses that provide a tangible object and 2- businesses that provide an intangible object, per say.

I'm not here to teach economics, but I do want to list some things I've learned about entrepreneurship.

1- To run a company, you must be invested. Don't run a company on a "good idea", run a company on something you are willing to miss Christmas to see succeed.
2- Have confidence your product/service is THE BEST there is. Actually, don't have confidence, you need to actually believe yours is. If you think someone else has a better product, you [probably] won't succeed.
3- Starting is the hardest part. You need time and money. By time, I mean a minimum 40 hrs/week and by money I mean initially a disposable  $10,000 (roughly).
4- You won't have time for hobbies, entertainment, or vacations, but you'll need them. No more painting, working out, snow boarding, hunting, fishing.......you shouldn't have time for these if you are truly invested in your company, however to keep sane, you should find time.
5- You will have to know all facets of owning a company. If you have a bachelors degree in rocket science, congratulations, that didn't prepare you to understand payroll, business taxes, operations management, patents, etc. Oh, and sooner or later, you'll need a lawyer ($$).
6- Network. You absolutely need every resource in the book. Whether it is someone who has been through what you are going through or a perspective client or a potential business partner, just network. "It's all about WHO you know." TRUTH.
7- Foreign labor is cheap. Foreign transportation is not. Decide how you want to run your company.
8- Be able to make decisions. Decisions under pressure, long-term decisions, hard decisions, you'll face them all.
9- Set Goals. Weekly, monthly, long-term, short-term, etc. Set high goals and obtainable goals, optimistic and realistic. The most successful people set goals, I can't remember the statistic off the top of my head.
10- Read. Read NPR, Forbes, any business journal or entrepreneur book.

I'm not saying these are going to make your company succeed or that these are the only factors, but they are certainly elements to consider.

On that note, in the near future, I don't plan to start a company because I don't have what it takes.