Key Question: How do I actually start a business?
The Online Workshop - Case Studies
1. Do What Interests You: Michael Novak reflects on the nature of self-interest. The example chosen comes from Diversified Chemicals. The two founders are interested in chemistry. They're coming up with new products to solve hard problems. Besides making many types of coatings and adhesives, they are recycling the rubber in old tires for new purposes.
2. Build Your Business As A Three-Legged Stool: Hattie reminds us that the American brand of capitalism is based upon private ownership of property and businesses, the rule of law and the moral habits most of us learn in church.
3. Find The Right Idea: Sounds simple but it is nearly impossible. As many as three million American try to start a business every year. Only a tiny fraction make it and an even smaller fraction make it big.
4. Prepare to succeed: The founder of Avocent was ready to start a business because he had done his homework and he shifted his thinking from an employee mentality to a problem-solving mentality.
5. Find Solutions To Problems: New products solve a problem and the bigger the problem the more successful the product will become. Life is just one big problem-solving laboratory. Yet, look at all the problems that surround each of us. Solutions are elusive.
6. Find Courage to Act: Ken Duncan knew he could work for others and have a steady stream of business but his assignments would not be the ones he could get excited about. He launched out on his own to take and sell the pictures that truly inspire him.
Key Questions at Step 2
Making it official: You are a "start-up" once you freely and easily say to others, "I'm starting my business!" When you let somebody else know about it -- although it only amounts to your second step -- you are taking a flying leap!
You have decided to do it! You are doing the American dream. A sincere "Congratulations."
Once you have developed that product and/or service, and you make your first sale, you will move on to Step 3.
1. Understanding Oneself - the Basics.
Check with your family. Let the most positive and supportive among your family and friends participate in your dream. You will need a support group and a sounding board before taking your ideas out into the public. All these people did...
Integrity check. Most people do not give up their full-time job. We start by working on our new business after hours and on weekends. And, most people wait until they have saved a few months of income and have some kind of safety net. Be ethical and be fair with your current employer. You know what we are talking about, and you know when you are stepping over the line. Listen, watch, and read what Albert Black says about how he started his business. More...
Build your business on a foundation of ethics. Have integrity. Have more energy and a free mind.
Goals check. In Step 1 we asked people to take our little quiz, and read the first chapter of Beating the Odds by Hattie. Though you are here on Step 2, if you have not already done so, please take the quiz and read that chapter. Know your goals and your aptitude for starting a business. Be sure to work through Step 1. Click here...
Mentors. Experts. Confidants. For your peace of mind, it would be wonderful to find one person who serves in all three capacities. That is a difficult person to find. It shouldn't hurt to ask. If you think it could, hold back for awhile. There are three local groups to look for help: Your Chamber of Commerce, SBA's Small Business Development Center, and the SBA's Service Corps of Retired Executives (SCORE).
Professional Associations. If you have not already done so (from Step 1 and Money 1), learn about your professional trade associations within your type of business. Every business has at least one. Have you subscribed and are you reading their trade publications? Consider attending a meeting of the local or state chapter of that national association. These people are excellent sounding boards for new ideas. There is a professional organization within every discipline; use one of the search engines and type in the key word for the type of work you do, and then add ("key word" + national association) and you should find a listing.
Look at the shows in the type of business in which you want to start. You can review some of that content as streaming video right here. More...
There are other specific episodes of the show that may be helpful by topic or by state.
2. Understanding Your History - Your Past & Knowledge
Business Incorporation & Web URL. If you are going forward, both are necessary. Delaware corporations can cost as little as $200 a year to set up and maintain. Nevada and South Dakota have similar tax incorporation benefits. But, also check with a local attorney; incorporation anywhere should not cost much more than $700 to set up.
If you did not start with Step 1, please go to the section within this site about Business Basics and look at the answers to these three questions:
3. Understanding Values - the Present: How do you spend your time?
Your first sale: Dream a little and project making your first sale.
How long will it take to make it happen? At what price will you sell? What is your answer? Now, how much margin did you build into the sale? Project your second sale. How long did it take and how much did it cost?
Now, think about growth. Extend yourself into the future. Describe your goals. Then, write it all down.
You will have written a rough outline for your first business plan. Save this document (eventually it will be a core part of your web site). Its first iteration may be as a marketing tool to share your successes with the general public. It could then become the first draft for your prospectus for a bank loan, for private placements, a direct public offering, and more.
Double check your business name. Don't do it and you may end up spending thousands of dollars to re-brand or license that name. See what Paula Quenemoen says about her mistake in not checking twice. Jagged Edge is a great name for extreme sports; it also works for ladies lingerie.
Buy your web address. Please, if you have not done it, search for it and buy it right now. You'll see many names are taken. Go with a different extension. It is not necessary to be a .COM, but realize there can be legal conflicts if that is your branded name in the marketplace. Get some legal advice if you you are that committed to the name. Or, come up with an even better name.
Business check. Get what is in your head out on paper. Besides that outline of your business plan, consider writing up the following: (a) A mission statement. (b) The first page of your web site. Just get it started. (c) Product descriptions. As clearly as possible, tell the world why this is the right product (or service) at the right time.
Use this web site. Because every entrepreneur in every episode of the show knows exactly how you feel and has been exactly where you have been, review as many of their shows as you can. If you haven't already checked, look at every story within your type of business and be sure to read the Case Study Guides. Look down over the show listings for names of businesses that intrigue you. Also, look at some of the stories in your state or a state nearby.
4. Understanding direction - the Future: Taking steps today for tomorrow.
The first sale. Some say, "Before you write your first check, make your first sale." Pre-sell your product or service to somebody. Get a commitment for at least one unit. Once you have made that pre-sale, revisit your mission statement and review your business plan. Review our show all about money and our discussion about money.
You are no longer a start-up when you sell your first product or service.
Selling your concept will help you to know in your heart of hearts that you are on the right path. If you are on your path -- that is a gift -- then it is time to build an infrastructure so you can make your special work your full-time work. Along the way you have to decide to leave the "security" of a job and a pay check, and become fully self-employed.
At this stage, it is called affectionately, "Family-friends-and-fools." Keep saving your own money. Develop that nest egg. And, be very careful about asking anybody for any money. This is your personal commitment. These are the dues to get into this ownership club. Read more...