You will have plenty of lessons to learn from. Don’t start a business by making these five mistakes.
Becoming an entrepreneur is a huge step — one that can lead to the freedom of being your own boss and setting your own schedule if done correctly. Growing up in an entrepreneurial household, I watched the ups and downs of running a business, giving me the best education by watching others fail and succeed. Learning through trial and error is the foundation of any entrepreneur and through that trial and error, I want to pass on the five things you should avoid at all costs before signing your name or spending a dime.
Don’t Chase Money
If your only goal is to make money, you’ll fail most of the time. By picking a business you’re passionate about, you’ll be able to keep going if the cash gets low, the market dries up, or you start to burn out. Picking a business solely for the financial benefit won’t keep you going when you need to.
I’m not saying that you need to pick a passion or life purpose type of business, but the main goal shouldn’t be to make money. You should find a way that you can provide value by solving a problem or filling a need in the market. By doing so, you’ll keep moving when things start to work against you.
Don’t Try to Make the “Perfect” Plan
Paralysis through over-analysis. It happens all the time. Most of the time, the business plan is wrong and will change as soon as you start the business. Get a plan together but plan on changing on the fly.
Make a business plan that shows the business is profitable and easy for others to understand. This plan will take shape as you find what works, however, don’t assume you need to stick to the plan or throw it in the garbage. Use it as an original blueprint, updating it annually depending on where the business is and where you plan on taking it.
The most successful businesses started from almost nothing and kept a frugal mentality throughout the life of the business. You don’t need the perfect business card, company car, or custom website. Wait until you start making money for those things. Don’t worry about all the “sellable business stuff” from other companies that tell you those things are required before getting started. Let the business pay for it all as it grows.
It’s a “scrappy” type of thinking that always leaves the business living below its means. Learning how to provide immense value for a low cost is key, as it will keep the business from overleveraging and failing when times get tough.
Don’t Live on an Island
You can’t run a company from an island by yourself. You need a team. Your ideas aren’t always the greatest and you need a team that challenges your decisions. Don’t run out and hire a bunch of people, but instead ask for volunteers, join a mastermind group, or talk with your local chamber of commerce. Just ask for help. You’ll be surprised how many people are willing to lend a hand.
Don’t Choose the Wrong Partner(s)
Trust me, don’t jump into business with the wrong people. I’ve learned the hard way with this one. When the business gets tough, the partnership will crumble if there isn’t a well-formulated relationship with defined roles and responsibilities.
Start by working on small projects with your potential partners and see how you work together. If there is friction (there always is), define where the friction exists and ask yourself if the partnership can withstand adversity. A business partnership is no different than a marriage, treat it with the same level of seriousness.