To Be, Or Not to Be, an Entrepreneur
June 28th, 2010 | 
Author: Being an entrepreneur is challenging.
That’s an understatement. Ask anyone who successfully runs their own operation and they will probably tell you that it’s the most demanding, and the most rewarding undertaking of their life.
While many entrepreneurs recognize characteristics such as knowledge, passion, and perseverance as being prerequisites for success, many don’t take the time do define what success is, and how they will measure it. This results in unrealistic expectations, or worse, measuring their success against the successes of others.
Every year it’s estimated that over 60% of new businesses fail. With a staggering and eye-opening statistic such as this, one should seriously ponder the question, to be, or not to be an entrepreneur, when considering entrepreneurship as an employment option.
Often overlooked at the outset of entrepreneurial endeavors are the requirements for success, which can be viewed as “phases” of development.
While they may vary in accordance to endeavor or industry, the first, and perhaps most critical phase, is market research – which has one purpose: to help you thoroughly understand the market that you are attempting to achieve profits in.
Too often, would-be entrepreneurs make an emotional decision to take a product or service to the marketplace without evaluating its viability. It’s always a mistake. Once met with the daunting task of marketing and differentiation, they buckle under pressure, and eventually fold.
In order to find your place, and your success in any marketplace, you need to not only understand the history, conditions, trends, and status of your market, but your competitors. In doing so, you find your target audience (those who will most likely value and purchase your services or products), and your niche (a particular product or service that you’re distinctly able to provide).
It’s not uncommon for novice business owners and upstart entrepreneurs to be delusional about the novelty of their products or services. This type of delusion breeds false confidence which can hinder your progress, and is detrimental to the life your new business.
You may not know of competing entrepreneurs and businesses offering similar services and products, but your target audience does. So does the bank from which you may attempt to secure a loan. It’s almost a guarantee that you will not be given a loan if you say that you have “no competition.”
Even though market research, and the information uncovered while conducting it may be vital, so is the need for start-up capital. Businesses need money to go like cars need gas. Undercapitalization is cited as one of the top reasons for business failure by the United States Small Business Administration (SBA).
Once you’ve cleared the research and start-up capital hurdles, the management hurdle looms just as large. Properly managing the day-to-day operations of your business is just as consuming, and should be done by someone who has skill and experience in doing so.
Your market research enabled you to discover that there was a market for your products and services, your marketing plan will help you to get people to discover your products and services, and purchase them.
Many people (and business owners) allocate the lion’s share of their operational budget to marketing efforts. It makes sense: you get back what you put out, right? Not necessarily.
Marketing always comes down to perceived value and desired benefits.
The real value of what you have to offer – product or service – should not be incongruent between how good it really is, and how good you made it seem with your marketing efforts. If so, your success will be short-lived. Eventually, such practices will come back to haunt you because word of mouth is very powerful, and is still one of the most effective marketing strategies.
If you successfully clear the research, management, and marketing hurdles, you need to be very mindful of business laws and taxes. I always recommend consulting with to a established business and tax attorneys about this aspect of your business. It’s worth it and it pays for itself in the long run.
Finally, there are the other miscellaneous items that while small, loom very large in the grand scheme of your success and happiness as an entrepreneur. No sick, vacation, or holiday pay; no 401K; unstable monthly income; longer work hours (maybe 12 hours per day). And this is before considering common issues with vendors, clients, and employees. Let alone factoring in the impact on your personal relationships due to time constraints caused by the growing attention demands of your new business.
In the end, it really does come down to passion.
If you are passionate about whatever product or service you have to offer, and passionate about your belief that it solves problems, fulfills needs, or caters to desires, you can overcome many hurdles with limited resources.
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