This Thursday marks a very special day for me; one year ago, I quit my steady job and became a full-blown, full-time business owner. Although I’ve kept pretty quiet about my personal and financial experiences throughout this (somewhat public) journey, I’ve decided to share a bit of insight in hopes that those who are also struggling, won’t feel so alone.
Like me, most new entrepreneurs begin their business voyage with LOTS of research. Research on their desired industry, products and services, competitors, demographics, financial options, etc. There are TONS of articles and books written on the (vastly uncommon) “rags to riches” success stories, and “how to start a business with no money”. To a brand-new, wide-eyed entrepreneur, at first glance, it appears as though starting and running a business is quite simple. It CAN be, if you have the right people involved, good skills, lots of money, and a freakin’ awesome business idea. But don’t be fooled into thinking you’re invincible if you have all of these things. Big success requires lots of growth (sometimes in the form of “struggle”)… it’s impossible to go from an “employee” to an “employer” without quite a few hard lessons learned in the process.
Business success depends heavily upon the owner’s ability to make the best of every situation; good AND bad. Although I don’t have any regrets (just lessons learned!), there are five BIG things I really wish I would have known prior to starting my business:
1. Obtaining Business Funding is NOT Easy.
When I started my business, I didn’t take out any loans, open any credit cards, or apply for any lines of credit. I didn’t have any savings, big assets, or collateral. I did quite a bit of research on my funding options for down the road if/when I would need it, and it looked as though obtaining it would be fairly simple when the time came. Experts say that bootstrapping (using your own funds) is THE BEST way to start a business, and that’s what I did. I had a very small inheritance, 7 years of hands-on experience, and the support of friends & family. Along with guidance from an industry advisor, this was just enough to get me started. I was able to lock down a location, get all of the necessary permits and licenses, decorate the shop, and order inventory. My mom dedicated much of her time and income in the beginning, to help me get things off the ground. I was incredibly lucky to have that extra financial and emotional support, PLUS the in-house marketing & graphic design. However, after a few months of working so closely together, our personal relationship began to suffer, so we decided to part ways (professionally) in order to preserve it.
After that, I was on my own, 100%. Because I had no back-up funds or credit cards, I was running my business solely off of what I was making every day in sales. As most of you already know, business owners don’t get paid until the business is doing well enough to sustain it. This stage, I would assume, filters out the entrepreneurs who aren’t very passionate about what they do, as there are LOTS of sacrifices made and priorities rearranged. It is NOT easy or fun.
After a busy first summer, my inventory levels became too low to even think about growth. I had to cut my marketing, events, and inventory budgets just to make ends meet, and I fell behind on many things, struggling, at times, to even keep the lights on (I still am!).
Around the middle of August , I began to dedicate most of my time to searching for funding, talking to lenders, and building my business plan. I met with small business advisors, financial consultants, and the Small Business Administration (SBA). I discovered that in order to get a loan from a bank, my business had to be established for at least two years, and to get a line of credit or a credit card, my personal credit score needed to be much higher than it was. Many of the lenders I spoke with would seem very enthusiastic about my business, but for one reason or another, “couldn’t help” me. The most irritating part was hearing almost ALL of them suggest that I lean on wealthy family members, as if I somehow “overlooked” that option.
Apparently, without good credit, savings, assets, or wealthy relatives, obtaining financial support for a new business is nearly impossible. But no one tells you that up front. If I could go back and do things over, I definitely would have done deeper research, and fixed my personal credit prior to opening. Knowing ahead of time that getting financial help during the first crucial years in business depended on my personal credit and assets, would have absolutely changed the way I did things from the start.
2. Running The Show On Your Own Is NOT Always Better.
At the time, I didn’t realize how much emotional support my mom unknowingly provided over those first few months. Having someone to go to for advice, ideas, or feedback on clients, events, inventory, and money, really made a HUGE difference with my stress level and emotional sanity. Once I started running things on my own, I had to take full responsibility and credibility for every aspect of the business. As my mind was constantly half-focused on a million things at once, I very quickly became MUCH less effective in my work.
As with everything, there are pros and cons to working alone versus working with a partner. It really all depends on what’s important to you… overall control over the business, financial dominance, emotional sanity (haha). I’ve toyed with the idea of finding a business partner, but at this point, I’m terrified to give partial control to someone who might not entirely get my mission. If I brought someone in who isn’t passionate about my business like I am, all could be lost.
You also have to consider your personal & social life. Taking on ALL aspects of your business by yourself means your brain will be preoccupied with work most, if not all of the time. I read somewhere that single people are the most effective business owners, because they can allocate as much time and effort into their work as they please. If you are married or in a committed relationship, it is IMPERATIVE that you make the effort to carve out time for your significant other. Not separating your work life from your home life is one of the top reasons marriages fail. Make sure your partner understands the rough road that could potentially lie ahead, and you’ll be able to determine your priorities right away instead of dealing with a bad break-up or multiple arguments later on.
3. Be VERY Picky About Who You Associate Yourself With.
Within the first few months, I discovered that being in the brick-and-mortar entrepreneurial pool (no matter where the location) is much like being in high school. There are cliques, loners, a few crazies, and TONS of gossip. Of course it’s important to be supportive and kind to everyone, but don’t make the mistake of expecting the same in return. Many business owners are in business for themselves…they don’t care who they have to step on or back-stab to get what they want, and you won’t see it coming. As for the gossiping: DO NOT involve yourself in any part of it. Don’t believe or repeat anything that is said about someone else’s business or personal life, and absolutely do not give your own opinion. Involving yourself will only make you look like a fool, and could potentially isolate you and destroy all of the professional relationships you have. So, make sure you’re always aware of how you contribute to a conversation involving other businesses!
4. Own Your Situation. No Excuses Allowed.
One conversation I will never forget was with a local business owner who came into my shop to inform me that her business was closing. I had been open for maybe 3 months at the time, and had only spoken with her on a few occasions. The conversation we had that day was SO negative and hostile, and I remember her saying (not so directly) that my business would eventually “go belly-up” too. The town sucked, the economy was terrible, and people just weren’t shopping or spending money. In all honesty, it was extremely disheartening to hear, but I wasn’t buying it… I couldn’t imagine what on earth could possibly happen for me to voluntarily close my doors. I mean, yes, the economy sucks and people are cutting back on spending right now, but that doesn’t mean small businesses should just shut down. It just means that it’s time to change things up, or do things differently.
Recently, I thought about this conversation and how it relates to my current struggle with finances. I realized that I wasted an entire three months, searching for an “easy way out”. I was telling myself that I wasn’t making money because I didn’t have the inventory (which is totally true), I didn’t have the inventory because I couldn’t get funding, and I couldn’t get funding because the banks, lenders, and financial institutions were unfair and stupid! Whatever the case, making excuses didn’t get me anywhere… my bank account is still empty. I’m the one who didn’t plan properly… I’m the one who leaped before looking. So therefore, it’s not up to anyone else but ME to get myself out of this mess. Taking accountability for your mistakes and decisions can open up a whole new world of options, and making the decision to take control of every situation will change your outcome.
There is a reason for struggle… a good reason. The first year in business isn’t supposed to be about astounding success, it’s supposed to be about learning and growing. You never know what you’ll discover or accomplish while trying to get from point A to point B, forcing yourself to think outside the box, and evolving with unforeseen changes. If you resist change, you are absolutely bound to fail.
“A woman is like a tea bag… you never know how strong she is until you put her in hot water!”
5. Enthusiasm Is Key… Just. Keep. Swimming.
It’s easier said than done, but what they say is true: positive thinking produces positive outcomes.
One thing many business owners (well, people in general, really) have trouble with is criticism. Rejection, disapproval, and negative feedback are all hard to hear, and even harder to process. One of THE MOST beneficial things a business owner can learn is how to turn a negative into a positive. This applies to EVERY ASPECT of your business and personal life.
Bad online review? Don’t delete it. Don’t hide it. Don’t Dispute it. RESOLVE it.
Behind and overwhelmed with bills or debt? Reach out. Make an effort to resolve the situation, even if it means making tiny payments every week. Most companies/institutions are willing to work with someone if they are truly making a real effort.
Unhappy client? Learn everything you can from them on how to avoid the same situation in the future, and thank them for their honesty and feedback. Use their dissatisfaction to your advantage!
We ALL have those days we don’t want to get out of bed and go to work… even though our work is supposed to be our passion. Try waking up to the idea that today could be a game-changer. If you try your hardest to be productive while keeping a positive attitude there is NO WAY you could have a bad day. Your struggles yesterday are in the past, and every day you get a chance to start over and make improvements.
Remember that everything has a silver lining or positive side. Sometimes it can be REALLY difficult to find, but it’s there if you search for it. Just keep your head high, and just keep swimming. Those who force their way through obstacles, and keep going even when it seems impossible, are the most successful, most grateful, and most happy people.
Sending a shout-out to those who have truly inspired, supported, and encouraged me over the last year. I can’t thank you enough!!!
Mark A., Teresa A., Sean B., Elisabeth R., Eli K., Kayla M., Anna C., Sarah N., Faya S., Dana G., Leah B., Amanda M., Jonelle J. <3