Everyone has had the dream of going into business for
themselves at one point or another.
Being your own boss, making your own rules; these are the
things that dreams are made of. Bug going into business can be risky. Fortunately,
there are people willing to take the BIG risk of going into business.
Fifty percent of small businesses started in Canada fail
within the first two years of existence. That number inflates to 60 percent in
the first five years and a whopping 70 percent in the first ten.
Maybe the biggest mistake that people make when going into
business for themselves is the label they put on themselves. The word entrepreneur
is thrown around like a basketball.
But what is a real entrepreneur? A real entrepreneur is an
individual who wants to take an industry by storm. Big dreaming and full of
enthusiasm, entrepreneurs are the ones who seek venture capital from “funding
angels” and venture capitalists.
Venture capitalists want to see there is an obvious, well
planned road to profit with any project they fund. If you’re not familiar with
venture capitalists and what they do, take a look at the program Dragon’s Den
and you will get a pretty good, yet media-charged example, of what the venture
capitalist does. When you think
entrepreneur, think Microsoft and Bill Gates.
An individual who would like to be self-employed is
generally content with selling one service on a smaller scale, possibly hiring employees
as business demands grow. Typically, there is less funding available to grow the
small business from traditional lenders, and venture capitalists aren’t
interested in smaller thinking. This means the self-employed are put into a
positon where they must support themselves and their business at the same time.
This process is called “bootstrapping”.
Those individuals who choose to be self-employed are
generally in it for the freedom that it presents. People with disabilities may
choose this route to help them join a workforce that would otherwise be too
rigid to accommodate their disability.
Perhaps the hardest thing about being an entrepreneur or a
self-employed person is figuring out what the product or service they are selling
is actually going to be. The status quo says “do what you love”, but how do you
determine if your idea is good for a business venture and not just a really
great hobby?
That’s where a business plan comes into play. A serious
business idea deserves the attention of a serious business plan. Developing a
business plan can be a daunting task, but once completed serve as an invaluable
tool. Big businesses generally have fluid business plans that are constantly changing
as consumer demand for goods and services evolves.
If you’re sincerely looking for a place to start with your
ideas, spend some time thinking about the impact you would like to have with
your product or service. Unfortunately not everyone can invent the next Pet
Rock, but with a solid business plan and a bit of luck you may just be able to
carve out enough market-share to support your business and yourself.
