Most prospective entrepreneurs I meet already know they want to be self-employed, but they’re less sure of exactly what kind of business they want to run. (Sorry, “One that makes a lot of money” or “One where I can set my own schedule” are not specific enough answers.) Most people have a general idea of what business they want to start—say, a yoga studio or a health care consulting business—but they don’t always know the specifics of what will make it a success (more on how to define “success” below).
The truth is no business idea is ready to go right out of the gate. Every entrepreneur needs to poke and prod their idea to varying degrees and usually tweak it a little (or a lot) before it’s ready to launch. But folks new to the worlds of small business often wonder exactly how to go about this.
Here’s the nutshell version of the advice I give to my students and clients. At the most fundamental level, every business has two basic elements that will either help it succeed or drag it into the ground: the business idea itself, and whether the owner(s) are well suited to run it. If either the idea is flawed or the business isn’t a good fit for the folks running the show, failure (or at least some serious stagnation) is probably just a matter of time.
Let’s look a little more closely at each of these in reverse order, starting with the “you” part of the equation, then looking at the business idea.
What kind of business is a good fit for you?
Here’s the easy advice first: The best business for you is generally one in which you have key skills or experience. The more skills you have—either general business skills like sales or financial management, or skills specific to the business, like software engineering, jewelry making or running a café — the better you’ll be able to handle the key tasks and systems involved in running the business without having to rely on others. And experience in an industry will shorten your learning curve, giving you a head start in figuring out how to turn a profit.
But here’s some advice you might not hear as much: Business success isn’t just a matter of profits. It’s also incredibly important that your business supports the life you want to lead. While some Type A overachievers might disagree, my opinion is your life matters. I think this is especially true for entrepreneurs who are putting in the effort and taking the risks inherent in starting their own venture. Why bother to take this all on if not to nudge (or even shove) your life closer towards your ideal vision?
Remember, you are starting the business, and you get to define what success looks like. For some people, success means big profits, but for plenty of others it means freedom and ample personal time. If you neglect to consider the bigger picture of your life and how the business will serve it, who’s going to do it for you? That’s right: no one. It’s up to you.
There’s a tradeoff dynamic here that I think is very helpful to understand: Generally speaking, a business that offers short-term freedom and lower financial risk tends to come at the expense of greater long-term freedom and a higher potential for big profits. For example, starting a simple freelance business with no employees typically involves very little start-up money and allows a lot of personal freedoms since you don’t have to worry about managing an office or staff. The downside, however, is that the business truly can’t run without you. If you take time off, the business essentially shuts down. And this will continue to be true unless and until you transition the business to one with staff (either employees or contractors) that are well managed, requiring policies, and systems to be implemented.
