Yesterday I had one of those conversations, I always enjoy to have with friends who are thinking to start a business. While the reasons to start a business varies for each individual, I have noticed that there are always, always three common threats that makes everyone feel the same frisson of fear.
“What if I fail? How am I going to pay back all this debt?”
That’s probably the most common phrase I hear, and is actually such a logical thought, however there is flaw. When you are investing a bunch of money in a new business you are probably going to buy some equipment, some material, inventory or even a whole building depending on the type of business you want to start. This part of the capital is not totally lost; it’s just a transformation of money from paper to something solid. Then you might have to spent some more money on some less substantial investments such as licences, fees, insurance or advertising. The money you spent on those kind of stuff is definitely evaporated, however it’s not or at least it shouldn’t be a big fraction out of the total initial investment.
Aftermath: The money you are going to loose in the unfortunate case of failing a business is going to be a fraction out of the total capital invested. Try to calculate that fraction and see if you can handle it. Most of the cases you will.
“I finally found out there are so may other businesses like mine. I am not sure I should do it.”
If this is a reason for you to give up, then give up. However, you probably never realized what running a business means. If you believe that all it takes to be a successful business is selling a unique product or service, you got that wrong. That’s just one part of it, and by the way the easiest thing for your competitors to imitate. Focus on how can you always be a better company regardless of your competition. How can you have the best customer service, the lower prices, the best quality or whatever it takes to differentiate your self from the crowd.
Aftermath: I guess the keyword here is clear: Best. Try to be the best, not the one. In fact if you are not alone it means there is a market for your product.
“The Golden Ages are over. This is a tough era for business. ”
That’s probably my favourite excuse to argue against! But I see how people are getting frustrated. They hear and read all these stories from successful entrepreneurs that did it this way or the other, who were lucky or smart enough to realize the right timing for them to start a business, bla, bla, bla… Well guess what: it’s easy to talk about what worked in the past and make fancy stories, but there is no way to predict the future and tell if something is going to work. No one can predict the future. Well…except Warren Buffet, but all of those successful entrepreneurs you know, had the same fears like you, however they did not stick to them and started!
Aftermath: There are not Golden Ages! There are always Golden Businesses, and if you want to own one of them, find a way to start it, work hard to run it and come back later in 10 years to talk us about how smart you were to see it’s going to work!