Many nine-to-fivers who have dreams of becoming entrepreneurs often press their noses up against the glass of the entrepreneurial lifestyle and fall into a swoon imagining the paradise that awaits once they embrace it.
I certainly don’t want to discourage anyone with entrepreneurial dreams from setting down that path, but if you’re contemplating the leap, you have to be careful not to fall into the trap of romanticizing the lifestyle or of underestimating what it’s going to take to get your enterprise off the ground. Here are some thoughts on a few of the most common things I’ve seen entrepreneurs underestimate when they’re first starting out.
1. Underestimating the time and energy your business will take
Deciding to become an entrepreneur isn’t all that different from deciding to run a marathon. You can’t just plunge in. You have to be in shape, and you have to understand the level of commitment that running a marathon involves. Are you prepared to arise at four in the morning in sub-zero temperatures to put in your training miles? Are you ready to take sizable chunks of time away from your family so you can give your goal the often-obsessive focus and attention it requires? Are you prepared to take on a physically, mentally and emotionally draining task? I hope so, because if you’re not, you won’t last.
If you’re thinking of launching your own business, you may be imagining the exhilarating freedom of dictating your own hours and control and flexibility you’ll enjoy with respect to those hours. I hear that sort of thing from aspiring entrepreneurs a lot. But what if you wind up having no hours, no control and no flexibility? Building a business is a round-the-clock job. There’s always something to do. So if you have a picture in your mind of an idyllically well-balanced life or business that runs itself, you need a reality check.
2. Underestimating the finances you’ll require
Another big mistake I see entrepreneurs make when they’re first starting out is underestimating how much money they’ll need to launch their business. There are very few certainties for entrepreneurs, but one I’ve found that one you can pretty much count on is that a new venture always costs more than you think it will. Most entrepreneurs are ideas people; financial savvy isn’t typically their strong suit. Pie-in-the-sky thinking works beautifully for visionaries, but it doesn’t work so well on the financial side. Don’t forget to think through all the potential costs carefully before you start, and ask others whose expertise you trust to eyeball your projections in case you’ve omitted something. Then put your numbers through hypothetical stress tests to make sure they’ll hold up under pressure. That way at least when a crisis comes--and it will--you’ll be ready.
3. Underestimating the need to balance your skills
One mistake that many would-be entrepreneurs make when they’re first starting out is thinking they can do everything themselves. You can’t do it all. It’s essential to surround yourself with others whose skills are complementary to yours. The people you hire don’t have to be your best friends--you’re not running a social club--but they do have to be individuals you respect and they should believe in what you’re doing. You also need to accept that you’ll probably have to hire them before you can really afford to. If you wait until you’re one hundred per cent ready, you’ll never get your venture off the ground.
There’s a Chinese proverb I like to quote about how you can’t take two leaps to cross a chasm. You have to think through how you’re going to approach the jump, get in shape for it, and consult others with more knowledge of physics and variables like wind and weather to ensure you’ve considered all the variables. Before you leap, you want to make the unpredictable predictable to the greatest extent possible. Even when you do all that, though, you can never really be sure if you’re going to land. You need to sometimes just make that leap with the information you have at the time, along with your instincts. That, in a nutshell, is what being an entrepreneur is about. So, do you think you can handle that?
I’d love to know what you think was your worst mistake starting out? What would you do differently if you had the chance to start over?