The prospect of starting a business, generating your own income, being your own boss and, importantly — controlling your destiny — is alluring. Indeed many business owners and entrepreneurs find self-employment exciting, rewarding and gratifying.
Without all the potential upsides to starting a business I wouldn’t have found the enthusiasm to write this website to begin with.
However, I think it’s important to acknowledge both sides of the coin. Beneath the glossy exterior, running your own business is gritty and tough. It comes with several risks and obligations that aren’t immediately obvious until you immerse yourself in self-employment, and begin to uncover (the inevitable) obstacles.
Don’t be too hasty to quit your steady job in pursuit of a “better” life. Firstly assess if starting a business is really suited to you and what you’re looking to achieve.
Traits required For Building A Successful Business
The following top 10 list is based entirely on my own experiences in self-employment, over the past nine years. I hope that it helps anyone who’s considering a switch to a self-made career path.
1. Positive Work Ethic — Voluntarily Taking On New Challenges
Without realising it, full-time employment may have caused you to develop some negative working habits:
- Periods of low productivity
- Maintaining a low profile / avoiding too much responsibility
- Fobbing off work to other people or departments
- Protecting your neck / letting others take on risk
- Prioritising easy tasks to ‘bloat’ your performance metrics
After all, if your job’s stable and you’re not seeking a promotion (or its not on the cards), then it probably doesn’t pay you to take on extra work and responsibilities for nothing. It’s understandable.
But that attitude that won’t serve you well in starting a business.
To run your own business you need to be dedicated, persistent — involved. You take on new challenges because you need to — whether you want to or not. There is no “job description” with specific roles & responsibilities to stick to. There is no insurance of a pay cheque every month, come rain or shine.
With your own company, it pays you to push. It pays you chip in, to provide a solution. You’re no longer a small piece in a large machine — you’re the engine itself driving progress forward. If you fail, the whole thing fails. Is that responsibility for you?
2. Broad Skillset — Being Equipped for Challenges Ahead
For many job roles, success is earned by mastering highly specialised, repetitive tasks. But running your own business is somewhat different: you’re rewarded by facing new challenges, and finding solutions to problems that you’ve never encountered before.
Consider all of the components required to build a business. There’s product development, branding, advertising, social media campaigns, sales strategy, accounting & finances, project management — and everything else inbetween.
Each of these components needs tending to. Therefore those equipped with a diverse skillset make for good entrepreneurs.
What if you can’t possibly manage all of those components?
It’s by no means game over. Everyone has limitations. However, you, as a prospective business owner, will need to adapt. Here’s some suggestions:
Learn New Skills
This site can help you to get the ball rolling with your new business — read through the blog to get some ideas. And for everything else there’s Google, Youtube, Quora, specialist forums, and thousands of other sites that you can consider your allies.
We’re fortunate to living in a time where we can obtain information, learn new skills, and tackle specific problems much faster than ever before. Use that to your advantage.
Outsource Your Tasks
No matter how much you apply yourself, you can’t take on everything yourself. Therefore you should consider other options — such outsourcing or employing staff.
Outsourcing won’t relieve you of all input, though. It’s somewhat naive to assume that you’ll be able to emulate the likes of Lord Sugar of The Apprentice, or the millionaire investors of Dragon’s Den, right from the outset. Those people have built teams of trusted advisers and highly skilled staff. They’ve earned the right to sit back.
On the contrary, we’re taking the traditional approach of piecing things together ourselves. Therefore we need to have at least a base-level understanding of how each part of the business runs.
If you don’t know your own business then you’ll struggle to determine where money needs to be spent, and what actions should be taken, to get the desired results.
To learn more, read my post on the Advantages and Disadvantages of Outsourcing.
Collaborate
Aside from outsourcing, there’s also the option to team up with people who are strong in the skills you lack.
If, for example, you’re building a web app and you’re strong at marketing, then you could team up with someone that’s skilled at web development/programming. Together you’ve got the core components for building and promoting a web product.
3. Flexibility — Integration With Your Personal Life
Most jobs are created in a structured format. There’s set rules, tasks, hours (ideally), and an etiquette. Working for yourself breaks that mould — and that’s not for everyone.
Throughout running your business there might be turbulent periods where you have to respond to unforeseeable issues. In an online business this is likely to involve a hardware or software fault. It could be midday on Saturday, you’re relaxing in front of the TV, enjoying a cup of coffee… and *ping* — your server goes down. What’s the plan?
It’s your business, so it’s in your interest to take action. This doesn’t necessarily mean getting your screwdriver out and mending the server yourself. However, doing nothing and continuing to sip your caffè macchiato in a state of sheer bliss, isn’t a viable option when your livelihood is on the line. If being flexible is the price to pay for success, then you’ll have to compromise.
The aim is to make your business as efficient and robust as possible. Getting there requires some level of integration with your personal life. Particularly to start with. So that’s something you have to be prepared to work on.
4. Selflessness — Working Towards a Common Goal
Office politics plays an enormous part in career progression within many organisations. It’s not always about who’s really best at their job and ripe for promotion. It’s about who you convince.
Here’s some of the deceptive office types you may be all-too familiar with:
- Loud, patronising speakers — those office types who talk down to others at their level. They want everyone to know they’re important, and authoritative. Question them on anything they do — even when they’ve got something terribly wrong — and you’ll spark an argument. At the end of it, you’ll most probably be condemned for “not getting along with your peers”.
- Social climbers — they seek out those who have an influence and befriend them. They discard the rest. The aim is to position themselves more favourably for the future. When push comes to shove, they’ll throw just about anyone under the bus.
- Grovellers — these guys unashamedly suck-up to their bosses. They’re less subtle than social climbers, but ultimately have the same long-term view: to position themselves more favourably for a promotion.
- The 5-minute worker — after five minutes of ‘graft’, he’ll proudly highlight what he’s completed. He constantly plays up his workrate in an attempt to convince the people in charge he’s the most hard-working and valuable employee of the bunch.
- The never-gets-his-hands-dirty guy — he intentionally evades responsibilities that carry significant risk. The strategy is to keep his hands squeaky-clean in order to easily pass blame onto someone else when something goes wrong.
- The ineffectual guy — by making a small input he puts the faintest of marks on a project. If it comes off as a great success, he’ll accept more credit than is due. If it doesn’t, and it fails, he will play down his input and distance himself from it.
- Knowledge hoarders — they keep valuable information to themselves, or within a close-knit group. By hoarding it, they force others to depend on them. This helps them to maintain power, and justify their place in the company.
Many large companies breed, and reward, selfishness. But applying those same (deceptive) corporate survival techniques to your own small business has the opposite result: it’s suicidal.
Running a company means making contributions that promote sales; it’s not about asserting your value to those around you. You’re not not rewarded by looking successful, you’re rewarded by being successful.
Therefore you need to shift all that competitive energy onto defeating competitors rather than your peers. So if you’re a product of a hierarchical corporate working environment and aren’t prepared to make this transition, then stay in regular employment.
5. Risk Aversion — Acknowledging Potential Downsides
Due to the risks involved, remaining in steady employment at a long-standing organisation is better suited to many individuals than starting a new business.
The following factors threaten the success of a business:
- Product risk. Being able to explain your product’s USP, the problem(s) it solves, and why it’s worth investing in, is much harder than it seems. Failure to strike the right chord with your audience will hinder sales.
- Market risk. Knowing your customer and why, how and where they buy related products is vital. Identifying routes to market, in a timely fashion and within your budget, could easily determine the success of your business.
- Financial risk. You can set milestones — but there’s no guarantee you’ll reach them. Loans, debts, wages, and running costs may create cashflow difficulties. You, personally, face the consequences of that.
- Team risk. As alluded to in #4, there’s a need to build a co-operative team that believes in your product and will do their utmost to meet the objectives you set. Without a positive ethos you’ll struggle to achieve the desired results.
- Execution risk. Having a great business idea doesn’t garner success. The execution of that idea does. Therefore it’s crucial that business owners learn how to steer the project in the right direction. This means striking a balance between being the micro-manager and the high-level strategist.
Some risks you can control, others you can’t. The art of running a successful long-term business is taking steps to reduce risks, while recognising that you can’t eliminate all of them entirely.
6. Management — Time, Finances, Team Building, Adaptation
Making the leap from employee to business owner comes with new managerial considerations.
Time
As the phrase goes: “time is money”. It’s true.
There are only 24 hours in a day, and we’re mandated by nature to spend approximately eight of those hours sleeping. It’s down to us to prioritise our goals, and manage our time, in order the maximise the impact we make during the hours we’re awake.
Successful time management isn’t about giving up on things you enjoy — but rather realising the things which hold you back, and eliminating them. To learn more, I recommend reading the award-winning book, The 4-Hour Workweek.
Finances
Cash flow problems and mismanaged finances are a major cause of business failure.
Some companies fail to plan properly, some set their sights too high or low, some don’t keep track of costs, some fail to chase payments.
You need to control spending and grow your business without taking excessive financial risks. But the skills required to do that aren’t necessarily learnt in your previous job roles, or through your personal experiences. For many of us, its all part of an entirely new learning curve.
Team Building
Being personable is part of what makes you a good project leader. People on your team have to like you, or they’ll resent making you wealthier.
It’s not about bullying, shouting, ruthlessness. Those traits will drive your team away, increase staff turnover, and burn bridges. You can’t afford to do that.
You’ll need to learn to compromise when necessary — but also accept that you can’t align everyone to your way of thinking. Try to seek staff and collaborators that share the same values you do.
Adaptation
You might start out doing one thing. But if that doesn’t achieve the results you expected, then you need to make a change. This might mean reevaluating your initial vision, broadening your horizons, compromising on taste — or even abandoning the project altogether.
To learn more, read my posts:
7. Discipline & Patience — Sticking to the Plan
Having all the right ingredients doesn’t make a gourmet meal. You need to follow through with the recipe!
Failure to stick to the plan is perhaps one the greatest downfalls to new businesses. Are you prone to veering off course?
Stay Focused Through Peaks and Troughs
If revenues are up and things are going great, stay focused. Don’t pull back and relax. Pursue other goals in order to grow the business.
Likewise, if revenues are down, don’t wallow in self-pity. You have to accept it, and get to work on improving the situation. As the phrase goes: “small steps will see your goals”.
Finish One Job before Starting Another
Generating new business ideas, and displacing old ones, could be detrimental to your progression.
It’s tempting to launch multiple projects at once in an attempt to multiply revenue. Unfortunately it may do the opposite. With too much on your plate, you’ll struggle to realise your vision on anything. I’ve learnt that the hard way.
Start with one project and see it through. Observe what worked, and what didn’t. Learn from it. Try again, and aim to improve each time. It’s slow, but effective.
Take Action When The Going gets Tough
If it hasn’t been your day, your week, your month, or even your year — don’t panic. Focus on what you can control: your actions.
Set general milestones, then break each those down into smaller, singular tasks that will get you there. Set a timeline of at least three months. If you continuously hit on those tasks, then you will edge towards where you need to be. This approach has helped in grouping and prioritising tasks across my own projects.
I strongly believe that discipline, patience — as well as the ability to manage yourself — is mandatory for running any business.
8. Networking — The Drive to Make Useful Connections
Networking might be an unfamiliar concept to some of you. The objective is as follows:
Networking: to identify opportunities for partnerships, joint ventures, or new areas of expansion for your business.
Networking no longer hinges on your social skills and popularity in the ‘real world’, as a lot of activity takes place online nowadays. So it’s not just about showing up at functions, shaking a lot of hands, talking the talk, and collecting a bunch of business cards.
In the case of my affiliate sites I do around 95% of networking online by contacting:
- Companies — to work out if there’s an opportunity to promote their products, and negotiate the terms of a deal. I occasionally discuss ways to collaborate on something else that’s mutually beneficial (e.g. a guest post on their blog).
- Competitors — to establish whether we can team up or combine resources in order to strengthen each other’s brands. I’ll often do this this the view to improve SEO.
- Customers — to share my knowledge on a particular topic in order to build trust, and develop a rapport.
I usually reach out via LinkedIn, Skype, Quora, Twitter, Instagram, and Facebook.
Making connections has been instrumental to learning new tricks, and driving traffic to my websites. In turn, that’s helped to generate more sales and income.
Networking will have a positive impact on your business provided you’re willing to put yourself out there, and commit time & effort to it. Getting positive results might mean stepping outside of your comfort zone from time to time.
9. Accountability — Maintaining High Standards & Riding Storms
What may be a temporary ‘blip’ for a large organisation could have a devastating impact on a smaller company in the same industry.
If you commit a ‘sin’ within the large organisation you currently work for, what are the consequences?
Provided you haven’t committed an actual crime, I’ll hazard a guess that your worst case scenario is being fired or having to resign — assuming you’re found out in the first place.
This sounds disastrous, but more often than not everyone, and everything, recovers:
- Company — replaces the member of staff and works towards repairing damages incurred internally and externally. There’s a short-term transitional period.
- Customers — some go elsewhere. But those invested in the legacy of the company are willing to give them the benefit of the doubt. After all, it’s just one “bad egg” within a large, long-standing organisation. Lost customers are replaced through increased marketing, and public relations.
- Fired/resigned staff member — he’s blown it with this company, but it’s not the end of the line. Another company takes a gamble on him. They might not even be aware of his previous ‘blip’, and thus he has a second chance. An alternative career path is the worst case scenario for him.
The Toyota Car Company
The world’s largest car company, Toyota, suffered a major blow after recalls from 2009-11, due to faulty brakes. This proved to be a storm the organisation was able to ride out.
While this (potentially catastrophic) blip dented Toyota’s share price by 15%, and many jobs were lost — it didn’t tarnish the brand permanently. There’s still a legacy of satisfied customers out there. In fact, many Americans believed the negative media coverage on the Toyota recalls was merely a bid to boost rival company, General Motors.
Could a smaller, less-established car company with only one model have survived such a set back?
Living Dangerously — All Your Eggs In One Basket
It’s not so forgiving when you’re running a small business which can’t afford to ride the storm. In the event of a crisis, there’s no layers to hide behind, no huge company legacy to fall back on, limited resources at hand to rectify the problem.
With all your eggs in one basket, a crisis is infectious, rather than one small blow. It’s a uphill struggle to restore damages.
Furthermore, as a small business owner you’re accountable for your own actions as well as your employees’. So if you’re heavily invested, then you’ll suffer more repercussions than you ever could as an employee of a larger company.
It’s all the more complex when the people who caused the problem — employees, collaborators, founders, for example — are an integral part of your small organisation, and have significant control over it.
10. Passion — The Desire to Drive the Business Forward
The difference between business owners who push through difficult times and those who don’t is passion. Self-motivation is crucial.
However, I don’t believe that passion for an industry alone ensures that you’re onto a winner. In fact, one of my most successful projects is a table tennis brand. I enjoy playing the sport — but my real interest lies in developing new products.
Not every passion you have will present the best business opportunities. For instance, imagine you’re a chef running a restaurant…
You might discover there’s an enormous demand for a certain dish: one you’re not particularly passionate about. But you’re a great cook, which is the important thing. Would you be inclined to adapt your menu and cater to the demand? Or would you prefer to keep to your personal preference?
The point is, you can’t always maximise earning potential by sticking to your preferences and principles. The market dictates demand.
I think it’s important that you enjoy the process of running your business. You have to wake up every day and want to work on it. You have to care about the quality of the end product, fully understand the consumer, and actively take actions to drive the company forward. But as you go along, you may need to remain open-minded about the direction you go in.
So there’s my views. Let me know yours in the comments section!
Want To Learn More About Running Your Own Business?
You’ll face several challenges in running your own small business. Learn how to overcome them by reading the following posts:
- The Pros And Cons Of Working From Home
- Will Outsourcing Benefit My Online Business? What Should I Outsource?
- Biggest Problems In Affiliate Marketing & How To Solve Them
- 10 Big Mistakes In Web Development & Programming Projects
- How To Adapt Your Online Business To Fit Its Audience
- Criticise Your Business To Make Improvements
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