|
St.Louis Business Journal
Five Criteria to Meet Before Starting Your Own Business
By Anna Navarro
May 1998
Author's note: Client stories in this column are based on actual situations fictionalized to protect privacy and told with permission.
Although the effort and risk of starting a business can be daunting, a lot of people find self-employment provides the best opportunity for financial gain, security and a balanced lifestyle.
The promise of self-employment seems to hold up well for those who are able according to a 1997 Gallup survey which shows those who own their own businesses are twice as likely as non-owners to be “extremely satisfied” with their work.
The risks are huge. To become self employed often means facing two to three very difficult years with little or no income, paying capital and operating expenses out of pocket, not to mention the constant anxiety of not knowing if your concept will become a solid business.
Even after you make it past the start-up stage, the challenges of competition and changes in the marketplace can threaten everything you've built. That’s why only 50 percent of new businesses are still in operation after five years.
Yet the number of new businesses in the United States continues to grow, increasing 57 percent from 1982 through 1996, according to the Small Business Administration.
Virtually all net new jobs were created by firms of less than 500 employees. Slightly over 50 percent of those companies are micro-businesses with fewer than four employees.
The up-and coming generation seems to be signaling this is the path they tend to pursue. For example, as a result of student demand, 400 universities today offer courses in entrepreneurship, a course that was virtually unknown 25 years ago.
Is starting a business the right path for you? It might be if you can:
1. Craft a clear vision of a service or product you could joyfully provide;
2. Determine that there is an unmet demand;
3. Market and/or sell yourself, your product or your services;
4. Self-structure. In other words, be a good time manager, project and/or people manager and self-motivator;
5. Persist in the face of adversity.
There are multitudes of ways to start your own business.
One of my clients was head of the video and film department in a large Eastern corporation. He handpicked his staff, which enjoyed a high degree of esprit de corps. He saw downsizing coming a year or so in advance, which is when we started working together. His talents were well suited to his job.
As a result of our work, he decided to form his own video company. He made a proposal to his firm and left with a three-year contract to handle their video needs and keep the employees in his department.
He saved his former employer severance pay by taking his employees with him; the contract he negotiated with them paid his overhead so he could devote himself to broadening his client base. Today it's a solid video production firm with more than 20 corporate clients.
(This is an opportune time to note that the U.S. market for outsourcing services was $100 billion in 1996 and is projected to triple in the next five years.)
Some of my clients, like the video producer, are using the same skill set in their independent businesses that they used in their previous jobs; others are moving into areas that have nothing to do with their former employers, still using the same skills.
For example, one of my clients was the senior vice president of one of the country's largest health-care systems. His forte was as a diplomat and negotiator. He was especially adept as a crisis manager. Realizing his skills were mismatched with the corporate culture he was in, he decided to become a management consultant, specializing in turnarounds.
It has taken slot of work to build his practice but today he's an eminently successful micropreneur, earning much more than he did as a corporate executive.
Still other clients are starting their own businesses using totally different skills. One woman with a master's degree in social work was the chief fund-raiser for a large nonprofit agency when we started our collaboration. Her favorite skills, she discovered in our work, involved physical activity, making things with her hands and creativity. Those all were afar cry from what she did at work.
She resigned her job, left her profession and, after two apprenticeships, is now a designer and maker of handcrafted furniture.
Anna Navarro is the founder of Work Transitions, a nationwide career consulting firm that trains independent career strategists and consults with individual clients.
This column was originally published by the St. Louis Business Journal. The actual title of the column and date in which it appeared in the Business Journal may be slightly different from what appears on WorkTransitions.com.
|
|
