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Steven Strauss: 5 things to know before starting a business

July 23, 2012

Everything I read about this ‘starting a business’ stuff is so peachy. But it seems pretty hard to me. So what do they not tell you that I should know before I jump in?

Well, I guess you can count me in as one of those pundits who tends to paint a fairly rosy picture of entrepreneurship. Guilty as charged. I do so because I truly believe it is the right answer for a lot of people who are not happy at work, and for others who might be but could still be more fulfilled, happier, and make more money working for themselves.

Oops, there I go again.

So in the name of fairness and the public interest, I must also confess that there are indeed things you don’t hear as often. Here then are my Top 5 Things you need to know, but may not, before starting a business.

1.  You will need more money than you think: One of the main issues any entrepreneur faces when creating a startup is that it does indeed take money to make money. The question of course is – where do I get that money? The usual suspects are yourself (savings, cashing out), friends and family, and SBA loans. Lately other ways have arisen too – microfinance and crowdfunding to name just two.

But an equally vexing issue is the amount of money you will need. The short answer is that you will need enough to launch the venture, buy product, get inventory, market the business, and pay yourself – for at least 6 months, because that is the minimum amount of time it takes to start, get the word out, get business, and start the money cycle.

And also, things will go wrong, mistakes will be made, unforeseen problems will arise. That is why it will cost you more than you think, for probably longer than you anticipate.

2. You will need a robust e-presence from the get-go: This is not something that can wait for later, or be done poorly. Right from the start you simply must have a good website, and a decent social media presence. Nab the Twitter and Facebook domain names for your business as soon as you know what that name is. Get a good-looing website up and running before you have your grand opening party. You may even want to get some videos done to post on the site and have an e-newsletter ready to go from the start.

People today will find you as much online as they will offline, maybe more so, so your online offering has to be top-notch. You really do not get a second chance to make a great first impression.

3. You will need skills: Whatever skills you have learned along the way, whatever your specialty at work today, it will likely be true that you will need to bring those to bear in your startup right from the very beginning.

When you start, your resources and help are limited. You will wear a lot of hats. If you are good at accounting, great, that is one less thing you will need to pay for. If you have marketing skills, those will be vital to your startup. Sure you will be doing other new and fun and interesting things, but do not discount how important those old tried and true things will be as well.

4. You will need customers: Right now, no one knows about your new business. No one. Zero. Zilch. Where will these new customers come from? You will need to let people know you are there, so before you ever open the doors to your new business, you better have a great plan in place.

Start by contacting everyone you know. That is one source. Your website, Twitter, Facebook, and LinkedIn? That’s two. Marketing and PR is three. Pay-per-click is four. I suggest you come up with at least five different ways to bring in customers before you begin.

5. You will need patience: As you can see, it all takes time. Neither Rome, nor you new startup, was or will be built in a day. So creating that new enterprise takes faith and perseverance. Keep at it every day. Plug away. Follow your plan. It almost always pays off, especially if you were ready, right from the start.

Today’s Tip: Looking to start a business on the cheap? Then consider picking up a great resource that helps you do just that: The $100 Startup by Chris Guillebeau. Steve says check it out.

Steven D. Strauss is a lawyer, writer, and speaker, and is one of the country’s leading experts on small business as well as an international business speaker. The best-selling author of 17 books, his latest is the all-new 3rd ed. of The Small Business Bible. You can listen to his weekly podcast, Small Business Success Powered by Greatland, here, visit his new website for the self-employed, TheSelfEmployed, here, Follow him on Twitter, here, and Like TheSelfEmployed on Facebook, here. You can e-mail Steve at: © Steven D. Strauss
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