Q: Hi Steve. I opened a business a few years ago and the truth is that I thought I would like it a lot more than I do. I work more now than I used to and my income fluctuates so much. I don’t really have a question, I am just griping. Thanks for the ear! — Vicky
A: I hear ya, and I think what you are experiencing is something we all experience in life and work:
• That new job isn’t quite what they made it out to be
• That good friend isn’t such a good friend anymore
• Raising kids is hard work
And yes, it’s true too when you work for yourself.
So here then are what I call The 5 Things They Don’t Teach You in Small Business School:
1. You may not like it. I think it is safe to say that the dream of every new entrepreneur is that he or she will create a business that is fun / interesting, profitable, and worth the effort. And while people go into business for themselves for all sorts of reasons, one thing most people expect is that they will like it.
Not always true, that.
What they don’t tell you in small business school is that sometimes that’s true, and sometimes it’s not. That your business won’t progress the way you planned is a given. There will be twists, turns, good times, bad times, sad times. You may like working for yourself, or you may find it exhausting, frustrating, boring, lonely, or [fill in your adjective here.]
Of course, you may love it. I do, and can’t imagine doing anything else. But, as they say, to each his own.
2. You may not be good at it. This has happened to many a new entrepreneur: He or she is great at something, say, photography. So she wants to start her own photography business, and she does. She sinks $10,000 into the venture – getting her equipment, getting her website created, joining associations, incorporating – the whole enchilada.
And then she finds that while she is a great photographer, she’s a not-so-great businesswoman. Maybe she doesn’t like, or get, marketing. Or maybe she has poor people skills. Whatever the case may be.
It is for this reason that I always encourage people to really think through whether they are cut out for self-employment long before they quit their day job.
3. Not every idea is a great idea: My brother once told me an about something that happened not infrequently back when he sold real estate for a living. There was a subset of clients, he said, who would “fall under the ether;” they would see a property and fall in love with it. Once that happened, they have to have it, no matter what, no matter the offer or counter-offer.
The same phenomenon can, and does, happen with a small business. People get Big Ideas all of the time. But not every big idea is a great idea. And woe be the entrepreneur who falls under the ether of his own idea without doing some due diligence.
4. It may be more work than you anticipate: Oh sure, we all expect to work hard when we start our own business. But there is hard work and then there is new business startup hard work. Not the same. And even if it’s not a new business, it still may be more work than you wanted, for instance, you own a retail shop and it’s December.
5. It may not work out. There is a famous statistic that says that half of all small businesses go out of business by year five. Personally, I take that stat with a grain of salt. That new business may have merged with another business, or the owner retired, or moved away and started it somewhere else, etc.
But with that caveat in mind, it is a fact that many small businesses simply do not make it. Dropping a lot of money, time, reputation, and sweat equity into a venture that doesn’t fly is not a pleasant experience (to say the least.)
So no, there are many things they don’t tell you in small business school. The good news is that no, they are not all negative. There’s lots of great things too (but that is fodder for another day.)
Today’s tip: So, just how do you succeed in business? Well, here’s a tip from Al Goldstein, whose two-year-old startup AvantCredit just surpassed $1 billion in funding, has more than 500 employees, and is one of the fastest-growing financial tech startups out there.
Al says to be sure and not leave good people behind. “If you encounter smart, talented people along the way, take them with you! From the beginning, entrepreneurs must identify the key skills that the founding team will need to get the business off the ground and sustain success.” (Two of Al’s former interns are now his two co-founders at AvantCredit.)