When is the right time to become an entrepreneur?
Several people have asked me over the last few years how I decided to follow entrepreneurship as a career choice, rather than pursue the more obvious paths of consultancy/banking/accountancy that my time at university (should have) prepared me for. The truth is, there was little to decide - for me it just happened. I did ave to make some sacrifices though, and this article should help you to go through a logical decision process should you be contemplating dropping out from whatever you’re doing and following your dreams.
Entrepreneurship is more of a lifestyle than a career. If you are like me, you will have fingers in pies and several projects on the go at a time, so by default you will not be following a typical route to the top. A young entrepreneur can find themselves at the head of a business employing people twice their age, and most of the benefits of working for someone else (private heathcare, pension plans etc) fly out of the window as soon as you jump ship. For these reasons, and many more, it is essential to create a solid base from which you can build your business empire, and that means getting you life in order before leaving the stability of a job or university.
Do you need lots of money before starting your own business?
Starting a business is a full time job in most cases, so you will most likely have to ditch your job to go it alone. This creates the problem of a lack of income, at least until you start raking in the cash from your new venture. Building up a healthy amount of savings can be a lifesaver for a future entrepreneur, as it will give you the financial stamina to weather out the difficult first few months or years that it takes to establish your business. Imagine running out of money for food a few months after launching your business and having to go back to your old job - not a nice situation if things are just getting started.
This isn’t necessarily possible, particularly if you are a young entrepreneur without a well paid job or rich parents. Having said that, your parents can be of some use because, and bear with me here, you can move back in with them. For some people this is their idea of hell, and for sure it will probably be disruptive for you and them. However if you’re serious about making money for yourself, you are going to have to make sacrifices. The money you save from rent/bills/some food costs and even going out can all be ploughed back into your business. That’s a powerful argument given that cashflow will be your number 1 concern in the early days. Your parents (or any other very good friend or relative) will also be there for emotional support and guidance when things get tough, something many business people overlook the importance of when they decide to go it alone.
It is important to be financially sound before quitting your job, so also make sure you have cleared any pressing debts before you commit to entrepreneurship.
Your personal life
As I said before, family and friends can provide essential support when you need it most, but the opposite can be true too. The main culprits here are unsupportive partners or ‘friends’ who do not see the big picture and try to talk you out of what you are going to do. If you live with your partner and share financial obligations, it is utterly essential that you communicate to them the risks of starting your own venture. After all, it may be them who has to cover the bills and rent until you start making some money. You partner will also be your main pillar of strength, so if they are completely against your belief in yourself and keep spouting negative advice, then you should seriously contemplate ditching the business idea or your partner. Of course, if your partner is always negative anyway I’d advise ditching them anyway, but when starting a business this is even more of an issue and drain on your strength.
Your friends will play a big part in how you understand your startup, whether it be the advice they give, new ideas, pitching practice or contact. Having a strong group around you will help you a lot, particularly when it comes to ‘down’ time away from your venture. Again, ditch your friends who are constantly negative, and don’t spend too much time feeling sorry for them that they cannot see the bigger picture.
The right idea
There is no formula for working out which business idea will succeed and which will fail - if there was, nobody would be here reading this, they’d all be on a tropical beach somewhere drinking cocktails. Some business ideas will sometimes just feel ‘right’, others will strike the right balance between risk and reward (a balance which varies from person to person), and some will literally just happen without you realising it. It goes without saying that having the right business idea is extremely important, so don’t go and take a huge business loan for the first idea that comes into your head. Write mini business plans for each of your ‘main’ ideas - do some rough market research, draw up some sales projections and simple profit an loss statements to get an idea of which ideas are viable.
Having said that, there is an equally strong argument for just running with an idea regardless of whatever the numbers say. In this respect, there is no such thing as the ‘right idea’, there is only your idea. If you are lucky enough to be completely single minded, then just do it. I know and you know that nobody is going to stop you. And if you fail, remember that if you try something, there is always a chance you will succeed.
Too bad, you’re not an entrepreneur
If you’ve read this far then you probably have a pretty strong desire to become an entrepreneur. However for some of you it is just not meant to be. Starting and running your own business takes a lot out of you, and demands certain qualities which cannot necessarily be taught. If you do not like the though of risking your salary and any benefits you get from work, your friends, your partner, the roof over your head and your sanity, then perhaps entrepreneurship is not for you. Having said that, there are ways of being entrepreneurial without the risks involved. With time, things change, and although you may not be ready to jump into your own venture now, who knows what the future may bring.
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