How to Make the Risk of Starting Your Own Business Worth It

The allure of starting your own business is not hard to understand. From being your own boss to working exclusively on your passions, starting a small business is an attractive prospect for many people.

The perks of business ownership are abundantly clear – you can probably already think of a few if you’ve been entertaining the idea. However, starting your own business also comes with its fair share of things to consider.

Let’s have a look at the benefits and challenges:

Before you quit your day job, here’s how to navigate around some of the most common pain points and make the risk of starting your own business worthwhile.

With the right business tools and strategies on hand, you can navigate around the roadblocks small businesses typically face to ensure your efforts pay off.

The transition from employee to employer (or self-employed freelancer) is a major one.

Starting a business is hard work – not a get rich quick scheme. The first year in particular will be a massive learning curve, as you won’t have the accountants, administrative assistants, managers and other professionals on your team like you may have at your current job.

You’ll also have to be comfortable with the element of financial risk, and the prospect of working long after 5pm.

A great way of getting the inside scoop is by speaking to real business people who have succeeded, as well as those who have failed in some respect.

Programmes based on practical, hands-on learning for the modern business environment will often provide an opportunity to ask real business people the hard-hitting questions.

Before diving into your new business, it’s critical to research the market.

By deeply exploring your business idea, you can ensure it is geared towards success before it even launches. Pursuing further education in business management is a fantastic idea, as it can teach you how to analyse the commercial reality of your business idea.

This will ensure you get valuable input from experienced people, and will save you time and money that could have been wasted going down the wrong path.

New business owners will typically invest their life savings in their dream, borrow money from family members, take out multiple credit cards and use their day job to supplement their side business.

In the early stages, you’ll also have to funnel the majority of your profits back into your business in order to maintain positive cash flow.

Be prepared for sudden business expenses like broken equipment, late fees, insurance and taxes as well to ensure you’re never left scrambling for spare change.

One way to pre-empt such expenses is to speak to experienced business people who have weathered it all. Cash flow is something you’ll always have to bear in mind, meaning it’s worth learning how to manage business expenses in a formal setting.

Once you have exhausted your own funds, you might start thinking about raising capital.

However, before you dive into the stress of finding investors, look into other opportunities to meet up with people in a similar situation to you, which will allow you to learn from a group environment as well as input from experts.

When it is time to raise capital, remember that having a strong business plan in place is an automatic plus in the eyes of investors.

You might find that it becomes necessary to tweak your business plan somewhat, such as by changing the amount of ownership you’re willing to give to investors or upping your product’s price point in order to attract much-needed investors.

In the startup phase of any new business, the most important thing is bringing on employees who align with your vision. The people with potential will be a greater long-term investment in your business than those who have the right qualifications on paper.

While it may seem difficult to get a big picture view at this stage on your journey, it is important to be thinking big, smart and in a future-oriented way. Learning the ropes of smart, modern business is an excellent way to project and plan for ongoing success.

Time management is one of the biggest pitfalls that small business owners face, with family life and a possible day job meaning that there’s not much time left over to handle the multitude of business admin tasks.

Finding a supportive group of people in the same situation as you can also hold you accountable, preventing procrastination. Small business groups, meetups, workshops and education programmes provide a much-needed support system to work through some of these challenges.

Using tools to automate tasks is also a great way to save time and money as well as improve efficiency.

Some solutions include:

When starting your own business, chances are you don’t already have a degree in business or a wealth of experience in the field.

Without a smart strategy in place, it’s too easy to get caught up in day-to-day tasks and neglect the plan for long-term success.

Building up your knowledge of modern small business is therefore one of the best things you can do, whether that’s through attending networking groups, getting a mentor, listening to podcasts or being part of a programme on smarter small business.