Let’s set the record straight: being an entrepreneur is NOT for everyone. And just like a singing career and a record label contract to SONY Entertainment, being your own boss should not be something everyone should aspire to become. Sorry if I shattered your China wear, friend, but this is the ugly truth about the ugly truth.
The inspiration to become your own boss usually begins with the voice within, whispering, “I can do this on my own, I can do this better than the company, heck — I can even do this better than my boss”. If you ever hear this voice within, quickly grab yourself a cold ice bucket and shove it down your head. Get rid of that tiny voice and call upon the voice repellent gods to shun that voice away. Why? Because the harsh reality is that 9 out of 10 businesses fail and 96% of businesses shut down within the first 10 years. If, for some persistent reason, you think you have what it takes to run your own game, then come up with a game plan. I had to save an entire year before I formally told my boss I would be quitting my corporate job.
Whether you have a job, find yourself broke, or freelance, come up with your game plan before you venture on your own:
- It’s never too early (or late) to talk to a financial advisor. Most people think that financial advisors are costly, but in fact, they are free (for the most part) and you can begin with your bank. See if you can open an investment portfolio or set up a retirement account.
- Make sure you have at least three months worth of savings to keep you covered. Don’t begin a business if you don’t have the financial means to cover your basic costs while you build a business. Building business profits can take up to a year so plan ahead!
- Look for angel investors to provide you with capital. These are individuals who provide startups with capital in exchange for convertible debt or ownership equity.
- Immediately set up a sheet of expenses (similar to an expense report for a business) and see where you can cut costs for yourself. Trust me I tried this for my business and I was shocked to see how much I was spending on software. Cutting your household costs can help you survive during start-up months. Also, looking at something concrete helps you make rational spending cuts rather than intuitive spending cuts.
- See if you can partner with other business owners or organizations that offer similar or complementary services in order for you to reduce in-house inventory costs. Remember, you are a small business so having everything done in-house can skyrocket costs for you and you don’t want to tap into your savings for something you can simply outsource.