So, you have a great idea, product, or service to offer the world and you want to start your own business? Fabulous! There’s a lot of technical and logistical issues that you will encounter as you begin your new venture, but first things first, are you ready to start your own business?
Check out my five part series on the questions you need to ask yourself before deciding to start your own business.
1) Do you want to be an employee or an entrepreneur?
The first question you need to ask yourself is whether you want to be an employee or an entrepreneur. This question seems painfully obvious and most people will answer “entrepreneur!” without hesitation. However, you will need to dig deep to discover whether you really want all of the responsibility and stress that comes with running your own business.
Your Work Ethic
There are many perks to running your own business including setting your own hours and choosing what type and amount of work you do. However, there are many downsides as well. In a survey of 10 entrepreneurs, all worked more than 50 hours per week and many worked up to 70 per week (source). That’s a lot more than your standard 9-5! If you enjoy hanging up your hat at the end of the day and putting work totally out of your mind, you want to be an employee, not a entrepreneur.
Entrepreneurs make sacrifices in their personal lives in order to make their businesses succeed. As with most things, it gets easier and less time consuming to run your own business the longer you are doing it, but the first years can be the most difficult. Over 40% of small business fail within two years (source). Can your personal relationships handle the stress of potential failure? If you don’t think so, you may want to stick with being an employee.
How do you feel about living on less? You might have to get used to it if you become an entrepreneur. It may take up to two years, after starting your business, before you can pay yourself a salary (source). Can you afford to work that long without pay? Would you even want to? If you’re dedicated to your business, is it possible to start it as a side hustle while working a full-time job? If you don’t have the energy to work on your side project at the end of a long day, you may not care that much about it or you may not have the work ethic that being an entrepreneur requires.
Problem Solving and Critical Thinking
When running your own business, you will ultimately be in charge of all day-to-day operations. You can hire someone to handle administrative issues such as bookkeeping and tax preparation, but that may not be feasible until you start getting customers. Any amount of business sense will be a boon to an entrepenuer, but the most important skills in determning whether you are suited to be an employee or an entrepenuer are critical thinking and problem solving.
While working for someone else, is your natural inclination to take problems or solutions to your supervisor? If you take problems to your supervisor and expect him or her to decide how to handle it than you may be better suited to be an employee. With the empowerment that running your own business brings, you may become more comfortable with problem solving, but it may not come easily. A person who is naturally inclined to brainstorm solutions before asking their boss for help would do better on their own.
Assuming that you don’t have a business partner, you are going to be your own main resource for problem solving and critical thinking. You’ll need to be a fount of knowledge and ideas. Thankfully, there are thousands of resources at your disposal specific to whatever type of business you want to start. You will need the motivation to look for resources that can help you and the critical thinking skills to put what you learn into practice and modify advice to apply to your situation.
Stay tuned for Part 2- Is There A Market for Your Business?