Tips For Wannabe Entrepreneurs

Tips For Wannabe Entrepreneurs

The glamour of entrepreneurship, the premise of unlimited success, and the notional freedom of being your own boss is beguiling.

It has never been a more attractive time to dream about entrepreneurship. The tough job market, coupled with the fear of being laid off, has made it difficult to be an employee. On the other hand, the glamour of entrepreneurship, the premise of unlimited success, and the notional freedom of being your own boss is beguiling. Every other professional is a wannabe entrepreneur, but are you cut out to be one? Also, is it actually the right time to be one? Here are a few pointers.

ATTITUDE: Readiness to fail

Survival account

What are your liabilities—mouths to feed, EMIs to pay, personal monthly expenses? Take stock of your liquid assets to see if you have enough to cover your outflow. Your ‘survival money’ buys you time to give your entrepreneurial dreams a decent shot. If you are planning on a venture in the services space, you should work towards paying yourself a salary in a few months. If you are building a product, it might take longer. Unless your family is ready to pitch in or you find an investor, make sure to build a survival account first.

Emotional support

Entrepreneurship is a lonely journey, much like climbing a mountain alone. At times, the going will be tough and your morale will hit rock bottom. The last thing you need is a loved one urging you to give up. Besides self-belief, it helps to have the encouragement and support of your family, friends and business partners so that you can persevere through challenging times. If you don’t have this, consider getting their buy-in before you start.

Back-up plan or burn the ships?

Do you want to be an entrepreneur just to see if it works? Or are you seeking a permanent change of identity? If you are motivated by the former, keep Plan B and Plan C in place. This could also include returning to former employers if things don’t work out. If the latter is your trigger, the easier way is to burn all ships so that there is no possibility of a retreat. You have decided to stick through whether you succeed the first time or after nine consecutive failures. Note that your choice of business is immaterial if you are switching for good.

APPROACH: Easy-to-miss path

Self-employed or entrepreneur?

Don’t confuse self-employment with entrepreneurship. In the former, your earning is dependent on the hours you put in. So, the doctor in his clinic or a tuition teacher are self-employed. The entrepreneur’s time and earnings are not co-related so directly. In the former, you can start part-time by moonlighting while carrying on with your day job. The latter is nearly always a full-time commitment. Like the doctor who builds a hospital, you too can switch to entrepreneurship.

Friendship vs business

Let not friendship be a reason to do business, or business the reason to make frie nds. Such structures tend to fail and can cost you the business or friendship, or both. If you still want to start a venture due to friendship, clarify who will be the final authority in business decisions. As in a pre-nuptial agreement, write down the course of action if the business or relationship were to fail.

Mentors to multiply

Just as you reach out to seniors at the workplace to show you the ropes, seek out mentors who will share their wisdom, experiences and contacts. These are the people who have been there, done that, and have tasted their share of failures and successes. They may help you either for a stake in your business or because of your relationship with them. Good mentors help multiply your efforts and shorten the path to success.

Good health and relationships

Make sure that your entrepreneurial ambitions include plans to invest time and effort in your health and critical relationships. As most entrepreneurs would tell you, by the time you realise there is something wrong, it is too late to make amends. Bad health will force you to take time off or even abandon your venture. Failed relationships could kill your drive and motivation to persevere or, at the very least, make your success meaningless.

ACTIONS: Taking the first steps

Physical set-up

The purpose of business is to earn money. For customers to start paying for your product or service, you need to get the paperwork and legal documents in order. The easiest way is to pay for the services of a trusted chartered accountant, who is already working with your mentor or an entrepreneur friend. Find out if you need to get registered as a proprietorship, a partnership or a private limited firm. Set up bank accounts, PPF account, and register for income tax, sales tax, service tax, Shops and Establishment Act, etc. Get the necessary permits and you’re good to go.

People power

As for human resources, start hiring only when absolutely necessary, and be clear about your expectations. Anticipate hiring mistakes and be prepared to fire when the need arises. Once you recruit someone, start teaching and empowering him immediately. Give your employees the space and motivation to get involved in your business and to contribute beyond their skill sets. It’s a win-win situation since the business is now powered by multiple entrepreneurs and the employees get to grow at a rapid clip.

Business strategy

In the initial days, when your market credibility is low and customers are difficult to find, it is tempting to take up any paying opportunity that comes by. However, strategy gurus believe that what you choose not to do is more important than what you choose to do. Think hard and build your strategy around the opportunities you turn down, irrespective of their attractiveness. Have a wonderful journey!

Top 5 excuses

Deciding on an idea

You have been waiting for divine inspiration for the past six months. Experienced entrepreneurs will tell you that ideas don’t matter. Get moving and start implementing. Ideas will evolve and success will depend on your ability, market, and some luck. The writer is Director, Executive Search, at Quetzal.

Waiting for money

You haven’t started because you need someone to invest in your idea or to pre-pay for the service you are dreaming about. No one will do so unless you have a proven track record as an entrepreneur. The only way to progress is to find your own money and deliver value until people start believing.

Looking for partners

You have spent a year looking for someone to build your website or a salesperson to sell your product. Remember that an entrepreneur takes complete responsibility for success and failure. So, get up and start selling, learn coding, and do whatever it takes till you find the right people.

Researching the market

You have an idea, but are not sure of your customers. You believe some more research will show you the way. However, entrepreneurs have a bias for action and avoid ‘analysis paralysis’. Learn by doing, not through research.

Writing a plan

You have spent three months with the unfinished first draft of your business plan. Complete it today and start presenting to others while you build your business simultaneously. The combination of expert criticism and rejection from customers will perfect your plan like nothing else.

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