Ohio SBDC - Free Expert Business Advice

Business Start-up ~ Don't Make It Difficult

I talk to people everyday that want to start a business. Most of them have interesting ideas but things start to go down hill from there. Many people get bogged down in complicated business processes, creative legal structures and the need for large amounts of financing. Due to this they may never get started. To these people I recommend you step back and take a deep breath. Don't make starting a business any more difficult than it needs to be. Simplify, especially in the early stages of the business. 

Here are a few "Easy Button" things you should consider as you are developing your business idea.

Does your background provide you the skills to create a business around your idea?

The "Ah Ha" moment where you come up with your idea is actually the easy part. The challenging part is building a workable business model around the idea. 

  • Easy Button ~ Look at things that you are excited to do and that you have experience in when trying to come up with a business idea. Build what is easiest for you, what you can do fast and what you are strong at.

What is your plan to build your business?

Note...I didn't say to do a business plan, I asked what your plan was to build your business. If you are a regular reader of this blog or have heard me speak on business development you know I am an advocate of the process of planning but not big on business plans. To many people get hung up on the structured format of a business plan and never really end up with anything workable. I prefer developing goals and the series of steps that will lead you to your goals, regardless of format.

  • Easy Button ~ Establish your "Mission", why you are in business, and "Vision", where you want your business to go. Next set business goals and the key milestones that will need to be reached to get to those goals. Finally, set the intermediate steps that will lead you from milestone to milestone. Once this is done execute.

Can you do it or do you need someone else?

Sometimes you just can't do everything yourself and need outside help. This is fine but the question is how much outside help. I once met with a person that had a retail prodcut idea. That is pretty much all that he had, an idea. To create the business he needed a designer, manufacturer, and investor. Without those things he could not move forward. 

  • Easy Button ~ Break things into pieces and do as much as you can by yourself before bringing in "paid" outside expertise. More than likely you will find that you can make a great deal of progress on your own that will actually make it easier to utilize outside help when the time is right.

What is your legal structure?

Amazingly to a lot of people this is starting a business. What is it is filling out paperwork. Don't get me wrong it has to be done and can be somewhat complicated but I don't know anyone that has ever made any sales because they chose to be a S-corp over and LLC. 

  • Easy Button ~ Look at what you are doing and select the strucuture that gets the job done, complete the forms and move on. The more time you spend debating legal issues the longer it will take you to launch your business. Depending on the complexity of your business you may want to consult an attorney and a CPA to make sure everything is completed properly so you can get on with business. The money you spend to get an attorney/CPA will get things done quicker and save you time in the long run.

How much financing do you need?

External financing is never needed to build a business. Now having said that, without external funding it may take 50 years to get to where you could get in five years with funding but in both cases you reached your goal. You need to think about funding as fuel for growth. The more money you have the faster you can implement your plan and grow. However, that funding comes at a cost. You need to really determine if you are ready to obtain funding before your pursue it. 

  • Easy Button ~ Bootstrap as far as you can before seeking funding. Bootstrapping, while challenging, will make your business stronger as you will have a much greater appreciation for revenue, expenses and cashflow issues. Also, the further you can push the business before taking someone elses money the more the business will be worth when you take other peoples' money.

Execute, Review, Adjust, Repeat

Once you start your business focus on moving forward. As your business progresses you need to constantly be looking at actual vs plan. How are you doing? You may find that you need to make adjustments, re-set and get going again. This is not a problem and is very common. The key is that you are moving forward.

  • Easy Button ~ Just Do It!

 

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