Fear, money and time.
These are the three most common challenges I hear about when I talk to people about what’s preventing them from starting their own businesses.
No matter where you are on your entrepreneurial journey, you’ve experienced an obstacle related to at least one of those three things. You might be experiencing one right now. But when you’re brand new to entrepreneurship, these challenges can be paralyzing. They prevent thousands – maybe millions – of people from ever trying to launch the business of their dreams.
Are you on the fence about starting a business because time, money or fear are holding you back? Then read on; this guide is exactly what you need to learn how to handle the risk, increase your confidence and enjoy the journey of entrepreneurship.
How and When to Quit Your Job
When I quit my job to start Write Ahead (now Renegade Planner), I only had $200 to invest in my new business. I registered my name, got a set of $5 business cards, bought a $100 piece of software, and put an ad up on Craigslist. I was good to go.
All of this might lead you to believe that I have a very high tolerance for risk, and you’d be right.
But that doesn’t mean I wasn’t scared.
When I talk to people who want to become entrepreneurs, their biggest obstacle is when and how to quit their day jobs. It’s frightening as hell to give up a steady income – even when that income is too small and going to work every day is slowly squishing your soul. Steady income is just that; it’s predictable. It’s much harder to create a steady income source from your own business, especially in the beginning when you’re still testing the market and it’s more difficult to forecast your revenue and your costs.
Where are the Customers?
You’ve probably heard the advice that you should research your target market when you’re starting a business. But that sounds really boring, doesn’t it? The truth is that once you start your business, you’ll be too focused on a way smaller group of customers to bother thinking about the size of your target market any more.
Market research bogs people down. They’d rather be out there selling – not researching who to sell to, and gathering oodles of data and statistics about nameless, faceless people. That said – you do need to know who you’re selling to, because you can’t reach everyone, even if “everyone” might benefit from what you sell.
Your target market isn’t “all dog owners” any more than it is “everyone who loves to drink martinis”. Millions of people might use your product, but if you try to talk to them all at once, you’ll lose more than you gain.
Instead, imagine there was only one person you could sell your stuff to. Just one. And you could clone that person enough times to make your new business profitable forever. Who would that person be?
Paying for This Thing
You can’t start a business for free. Don’t listen to what so many internet marketing “gurus” will tell you. It might only cost $200, but you absolutely, positively must spend money to make money. You must.
If you’re not sure how much cash you’ll need to start your business, you can make some estimates using this handy list (remember that not all of this will apply to you if you’re starting a service business):
When and How to Write Your Plan
You’ve probably heard more than one person claim that business plans are dead. Forbes writer Dileep Rao wrote that “no one gives you money just because you have put words on paper”.
Sure, 100-page business plans chock full of industry garbage and hockey stick growth charts are dead. All you need to know is who your customers are, who your competitors are, what problem your business solves and for whom, how much revenue and profit you think you’ll earn, who you need to hire, and how you plan to market and grow the business.
What’s the perfect vessel for all of that information? Somewhere you can easily go to check whether you’re on track to reach your business goals?
Building Confidence & Enjoying the Journey
Even though starting a business will always be scary, there are lots of things you can do to make it a bit less scary and a bit less risky – like creating a great business plan, understanding financing and cash flow, and knowing your ideal customer. But no matter how much planning you do, the fear element will still be there.
Luckily, this fear is exactly what can drive your ultimate success as an entrepreneur.