Can You Afford The Loss?
When a new business idea hits, it is virtually impossible to rein in your excitement. Day and night your mind is alight with something new. Sometimes you even have several ideas on the go. First, you try to decide which one to go with. You then contemplate the possibility of doing them all at the same time! It is a bit mad. Fun, but mad.
From much experience, some painful ones too, there is something I want to ask.
I would not expect an answer right away. You need to go away and think it through. Are you ready?
Can you afford to lose your investment?
There. I asked. It is a small question really. Or is it?
If the use of your funds will have an adverse effect on you, let sleeping dogs lie until you can afford to go ahead. Unless of course, it is money you have been saving for your idea. If you know using this money will not impact any other area of your life, particularly your rent or mortgage, then go ahead.
Yes, there is the idea that waiting is for losers and those who dash out there are the winners. When you see a new business open, remember, you never saw the path which lead to it.
Do you know how much start up capitol they had? Who was backing them? How long had they been working crappy jobs to raise the money for their venture? Did they sell their home? Their car? How many little luxuries and holidays did they sacrifice? When was the last time they bought new clothes?
If you go ahead and lose everything then rely on family and friends to bail you out, they will not thank you. Not only have you put yourself in a precarious position, you have jeopardised their income too. Unless they hate you and you are a malignant individual, no family member wants to see you on the street.
Are you prepared to gamble friendships? Cause friction in your family? Who and what are you prepared to lose?
What you do must not negatively impact on others.
All business is a gamble. Some you win — some you lose. That is not the issue. It is when you run blindly ahead without considering the consequences of what you will do if it goes wrong. What plan do you have to pay back family or friends if your venture does not work out? How about not putting them or you in that position in the first place.
Think it through. Have a plan. (I know it sounds boring). Above all, before you begin, ask yourself,
Is this money I can afford to loose?
In truth, without careful consideration, you will lose much more than money.