There are so many reasons why people want to launch their own business. They can have a product or a process they believe in on a profound level. Or they simply might be tired of having a boss.
What’s more, every situation is unique. One person may be trying to start a business right out of college, others may be trying to launch a business while working a full-time job. Others may try starting a partnership.
Regardless of the source of the motivation or the starting point for the business, here are several ways people can set themselves up for success.
Have Access to Enough Money
When launching a business, don’t run the risk of being too underfunded. In personal finances, many people don’t like carrying any kind of debt. But that’s a much bigger ask of businesses just starting out.
Launching a business is the acceptance of risk. Being too aggressive in avoiding risk can undercut the ability to innovate as well as prevent the ability to invest in the resources necessary for success.
So, having a business idea and believing in it often means not trying to fund it from the proceeds of a day job paycheck. Even in a small venture, that may cover operations, but it doesn’t account for when things go wrong and, most importantly, it doesn’t provide the financing necessary to scale with the business’ growth.
In some industries, such as farming, for example, managing debt is part of everyday life. There’s no predicting rain — or drought. Being financially stable enough to accept the “it is what it is” scenarios while waiting to take advantage of the lucky breaks can be part of business sometimes.
Chart a Path to Profitability
A big part of being able to risk debt is having a good plan. Projecting how long it will take to move through debt and toward profitability is essential.
When can you pay yourself? When is growth possible? When can more people or resources be deployed to streamline workflow?
It is possible to project how much debt would have to be managed in order to reach profitability.
For many, launching a business is a risk worth taking. But it’s also fair to say that it’s worth knowing the risks.
It’s hard to be successful without knowing what success looks like. Creating metrics — both short and long term — is a cornerstone to creating a successful business venture.
Running on a deficit is stressful for any starting business. Who wouldn’t want guideposts that lead to the light at the end of the tunnel?
Go beyond creating metrics and goals for the business. A business owner should create metrics and goals to measure personal development as well. The book “Measure What Matters” by John Doerr offers a solid strategy for this. Through the use of objectives and key results, one can chart a clear path of personal growth.
Don’t Outrun Infrastructure
The point of goals is to measure success. Having a business plan and developing metrics for success are all ways to build the infrastructure necessary to reach profitability. But don’t neglect physical and electronic infrastructure.
For example, if you’re in health care, then knowing an excellent IT company for healthcare offices, is going to be essential. Pathways for communication as well as stable workflow are all part of the modern supply chain, which must be well-developed and protected.
Minimizing unexpected downtime is important for maximizing efficiency.
Let Data Lead, Even if Your Heart Rules
Believe in the vision for the business- yes, but if a product or service gets more focus and resources than one that has more data to support its chances for success, then it’s time to reassess.
Launching a business is a deeply personal venture. It’s easy to get caught up in believing every product and process best serves the vision based on emotional attachment. But stay open to the possibilities provided by data, by the metrics for success established to drive the company forward.
That doesn’t mean there isn’t room for passion projects, but make sure to keep what drives the company forward at the forefront.
The best businesses fill a need. It’s okay to fill a want, but most businesses thrive on need. But more than that, they thrive on offering something unique.
In either scenario, offer people something they can’t get anywhere else. And if entering a field with competition, find a way to make the company’s version of what’s being offered something that isn’t found in the competition’s products.
Being better is great, but being different is invaluable.