Imagine with me for a moment.
You have your degree, you have some work experience, and you’ve decided to make the leap into self-employment. You went to conferences and networking events and you’ve been cleansed of the 9-to-5 by inspiring speakers, waxing poetic about “the grind,” “the hustle,” and how your product will sell itself if it’s worthy of the market. You’re beaming with starry-eyed confidence, you’ve been inspired by people who have made it, and you’re ready to dive in. There’s only one thing: the inspiring people who’ve been there may have misled you.
#1 YOUR WORK WILL SELL ITSELF
The truth: Your work will not sell itself.
It takes more than a killer product or portfolio to succeed in business. I’m fully confident in my work, but it’s not selling itself. I’ve been apart of startups that had an excellent, even widely validated, concept, that failed. And the reason why was the business side of it. One startup, we worked with someone who wanted the glamour of leading the team without any of the work. After he took over, the company went stagnant and eventually made it’s way to the startup graveyard. You have to have an idea of what you’re doing in business and find out what is working, what isn’t working and how to capitalize or fix it. You don’t necessarily need an MBA, but having some business sense is necessary.
#2 WORK REALLY HARD AND YOU’LL MAKE IT
The truth: Hard work isn’t enough.
Hard work is necessary. You have to be disciplined and dedicated in your work to build a business. The key is being dedicated and disciplined in working hard on the right things. I spend a lot of time on social media and on my blog because I know those things are good for visibility and reach. I need to spend more time networking. Networking is not just an investment in your community, but it’s also getting to know people who could provide referrals. Networking is just business speak for making friends and building good relationships.
#3 REGISTER YOUR BUSINESS AS SOON AS YOU CAN
The truth: Don’t register your business as soon as you can.
Consider holding off for tax purposes. For an LLC, you have to be profitable two of the first five years in business before the IRS will consider your business a hobby. It may be beneficial to build the business before you register it. Get your client base, test your product, learn your market, etc. Bring in some income and get some projects in the pipeline. Then register it. Of course, it’s your business, and it may be in your best interest to register it right away. It all depends on your business model, your personal needs and your finances. You should carefully consider everything you have going on in your life before you start a company. If you’re expecting kids, if you’re a student or if you have another job, consider the impact of these things on your ability to build your business. All things considered, it should not be assumed that you should immediately register your business.
Starting a new business is always an exciting endeavor. Just be sure that you’re making a realistic and educated decision. I made the decision to go out on my own over the course of about two months. I was surrounded by entrepreneurs and I still didn’t have all the information I needed. I made mistakes. You will make mistakes and that’s okay. That being said, if you can avoid some of the common pitfalls, why wouldn’t you?