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With the current employment situation in complete disarray, many Americans are considering the leap into entrepreneurship. Starting a business can seem risky, but it really is the best way to take control of your work and financial future. And, starting a business in a bad economy is actually a good thing -- resources are inexpensive, opportunities abound, and you have time to prepare for growth and expansion as the economy recovers.
Here are five facts every first-time business owner needs to know:
1. Startups Create Jobs.
More than 80% of all new jobs are created by companies less than 5 years old. This statistic has been true for decades. Those bloated corporations are quick to lay off workers, but not so quick to create jobs, and that trend is likely to continue. Americans who choose to start and develop new businesses will be key in resolving the current economic mess. Be part of the solution.
2. Startups Don't Make You an Entrepreneur, Innovation & Management Do.
The key to succeeding in small business is to innovate -- find a better, faster, or smarter way to do business. You don't necessarily need a brand new product idea, even a pizza joint with an innovative spin can be wildly successful. To be honest, many small businesses that have fallen victim to the economic disaster were on the path to failure anyway. Look around -- you will see plenty of small businesses using the downturn as an opportunity to remodel, expand, or branch out. The two things that separate the successes from the failures? Innovation and solid management. They do something that sets them apart from the competition and they use solid business principles to evaluate the market and control the company's future.
3. The Cost of Startups? Money and Time.
Some money and time are necessary for any startup, and the two factors are usually inversely proportional. That is, the more money you can put in, the less time it will take to succeed. Less money means more time. Either way, good planning and solid management skills are critical -- you don't want to waste any of the money you put in, no matter how much you have to spend. And, you want to be sure you spend your precious, valuable time wisely -- the further into a startup you go, the more limited your time will be.
4. Bootstrap Startups Will Have to be Built by Your Own Hands.
There are many ways to cut costs in a startup, and just about every one of them means more direct work from you. There is no magic recipe for immediate success, building a business simply requires time, money and effort. Do your homework, become an expert in entrepreneurship, and be prepared to earn every bit of the wealth you gain from your startup.
5. Startups Don't Make You Rich, You Do.
Many, many potentially profitable small businesses fail, and they fail because of mismanagement. If you are starting a business with the intention of getting rich, you have to develop the habits of millionaires to get there. Learn to manage your personal finances correctly, use debt correctly, and manage your time effectively, and you will be on the right track to all the success you seek.
About the Author-K. MacKillop, a serial entrepreneur, is founder of LaunchX and authors a small business startup blog. The LaunchX System is designed to help entrepreneurs start a business based on their own idea. It includes step-by-step business startup instructions, key software, business tools, and more -- a complete business kit. Visit LaunchX.com to learn more about this revolutionary way to become an entrepreneur.
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