10 Hard Truths About Starting A Business
Entrepreneurship is the best way to escape the rat race and live the life you have always wanted: flexible working hours, the ability to work from anywhere, and actually putting work into your own dreams instead of working on somebody else’s.
As wonderful as it sounds, starting a business comes with harsh realities that you have to be prepared for, even before you write down your business plan. Only 10 percent of new products succeed, and the average success rate of a first-time startup entrepreneur is 12 percent, so to increase your chances of succeeding, you have to understand and prepare for the difficulties before they come.
Here are 10 truths about entrepreneurship that you will have to prepare for:
1. Success Rates Are Very Low
The influx of startups making it big over the past few years has given many aspiring entrepreneurs hope of becoming the next Jeff Bezos. The hard truth is: startup success rates are very low. You are more likely to fail with your first startup than you are to succeed. According to the Small Business Administration (SBA) only about 50 percent of small businesses make it to the fifth year mark, while only a third will make it to 10 years.
2. It’s Financially Draining
There are a lot of costs in setting up a small business, and most of the time you are going to find yourself having to stretch pennies for a mile. You might even end up having to use your own money to cover the business costs. All of your decisions will start being dictated by the finances; you may have to reconsider that vacation because the money will be needed for your marketing efforts.
3. You Don’t Always Set Your Own Hours
When you start your business, you do whatever it takes to succeed, and that sometimes means working all the way through the night or working in the early mornings. If you have an international clientele, you will probably be working with various time zones; the best time to call your clients might be 3 p.m. their time, which may be 3 a.m. in your time zone.
4. Not Everyone Wants Your Product
No one product is suitable for everyone; chances are it’s not even suitable across two different audiences. Research shows that as high as 80 percent of new products launched each year fail to make it in the market. This is due to various reasons, but one of the main reasons is when developers overestimating their audience span. Spend your efforts finding an audience that matches your product perfectly, then work on converting them to loyal customers.
5. You Have Bosses
One of the greatest appeals of entrepreneurship is not working for anyone. Technically that’s true; there is no ‘traditional’ boss, but you are definitely working for someone. Your customers become your boss. Your job is to make them happy and satisfied so that they continue to do business with you. A good product alone won’t keep customers. You have to research and find out exactly what they want, and how they want it, then work on delivering it. The notion of ‘doing what you want’ is a far-fetched misconception about starting a business.
6. You Are Not Special
Everyone wants to think that what they are offering is the new groundbreaking product that’s going to change people’s lives. It’s not. In your local area alone, there is probably already a dozen other people doing what you are doing. You become special and set a part when you find something that gives customers a benefit like offering free shipping and exceptional customer service.
7. You Can’t Do Everything
No matter how talented and skilled you are, you can’t handle every aspect of your business by yourself. You are going to need to hire people or outsource work to get things moving along. And that means money spent, and a lot of business relationship logistics to manage.
8. Your Life Changes
In its initial stage, you are going to want to put all your energy into making the business successful. This means taking time from your friends and family to focus on the business. It means cutting short or forfeiting vacations and nights out. This can have an impact on the people around you if they don’t understand your struggle.
9. A Lot Will Go Wrong
The prospect of running your own business might seem very enticing when you are planning. You assume everything will move smoothly, from one task to another. The reality is that a majority of your plans are not going to go as planned. One small thing can send the entire business idea spiraling down the drain; a simple glitch in your machinery can stop production for a day, and the loss in revenue from that is going to be bigger than you could have ever expected.
10. You’ll Become That Boss You Hated
Among your reasons for wanting to leave your job was probably the pushy boss who just wouldn’t get off your back about things. The sad truth is that you are going to eventually have to be that guy. The chances of you finding all perfect employees who do their job to the maximum of their abilities and beat deadlines are very slim, so you may need to push people to produce great work. Sometimes you might even have to fire employees, and that is not an easy task.
Entrepreneurship is no easy feat, and if this is the road you decide to take, make sure you are not looking at it with rose-colored glasses. Learn the hard truths that many don’t like to tell about starting a business so that you start the journey well equipped and ready. It is a very rewarding choice that does not only improve your financial life, but can bring you fulfillment in life.