Think Small: How To Start A Side Business
We posed this question to 25 of our clients: Why haven’t you started a business yet?
By definition, our clients are a selective group: they earn and save well, seek advice, and outsource their investments – not confusing busy-ness for business.
In this article, we share our findings so you can determine if you run into similar problems and how you can overcome them. This is written to help those serious about starting a business.
Your Idea Is Meaningless
Before you can start a business, you have to have an idea. The problem for some is that they think their idea has to never have been thought of before. Here’s an example of how I mistakenly thought success was determined by a unique idea:
Jeff Taylor, CEO of Monster.com came to speak to a small group of us at Boston College. He challenged any of us to pitch our company or idea to get someone interested in it.
I raised my hand, stood up, and delivered my pitch.
“This is going to be huge and capitalize on web search and the desire to see internet companies go public. I’d be happy to tell you more about it if you’ll sign a non-disclosure agreement.” Jeff Taylor laughed in my face.
When we asked our clients what stopped them from starting a business, 84% said they didn’t have an idea to pursue. Some had no ideas and others had plenty, but none stood out.
Of the 16% who have their idea, not one of them sounds like the next Facebook. They are pragmatic: using their skills to start almost immediately with little startup costs.
Most people think it’s the uniqueness of their idea which will make them successful. They are wrong.
What matters is the ability to find a profitable idea and a way to do it better than others.
Knowing Is Half The Battle
Not everyone will recognize this G.I. Joe catch-phrase, but many will recognize its inhibiting power. “Not knowing” comes in various forms such as:
- “I don’t know how to get started or what to do”
- “I don’t have credentials to be taken seriously”
- “I have to know everything about a subject”
Over 75% of respondents said that some form of “not knowing” held them back whereas only 10% of them attempted to gain the knowledge required.
Here’s a real example of a client who tried to gain knowledge to start her business. She explains:
I’ve always believed in my idea and people all around me told me I should do it. I had support at home so I went for it. I got a health and safety license, took a restaurant course, did a bunch of research, went through a new venture fast track program designed to help me build a business plan, took vacation days off to do the course, and was one of only 8 who remained out of the 20 who started in the program. I gave away free samples to test groups and even drove the product to their homes in person, in order to get their feedback.
I started taking courses to get certified and become legit. In the end, I had a business plan but no business. I had a whole bunch of information and did not know what to do with it, so I stopped.
This story breaks our heart – she had a wonderful idea and the passion, background, and support to make it work – and it ended up dying in her head.
Most people think they need to know everything before they start a business. They are wrong.
It’s the quality of time spent testing and validating your idea with prospects that matters.
Fear of Failure
Almost everyone we talked with cited “fear of failure” as a reason they held back from starting a business. Do you recognize any of these fears/risks?
- “I don’t know how to raise money to get started”
- “I’m afraid of losing everything we’ve built so far”
- “I can’t afford to lose income, I have a family”
- “Getting bored and finding I don’t really like it”
- “Amount of time it takes away from family”
Risk is inherent with starting a business, but so few realize that risk can be minimized by the business model you pursue. Here’s an example of a conversation we had with a client recently:
I always believed I had to dream big if I was going to start a business. So to me that meant coming up with a truly unique idea and raising a lot of money to get started with office space, employees, marketing. That all changed after I talked to you. You helped me realize that I was never going to start that business because there was just too much risk for me to take. The answer was so simple.
In the book called “The Millionaire Mind”, research found no correlation between intelligence or education and becoming a millionaire.
The single largest indicator of becoming a millionaire was the selection of a business model.
Bigger Is Not Better
If you’re serious about starting a business, it’s time to change the soundtracks playing in your mind:
You have to have an idea no one has thought of, write a business plan, be an expert, have lots of money or borrow lots of it to get started, have an MBA, wear a Rolex, play golf, drive a Mercedes, etc.
Bigger is not better but so many get caught up in trying to act like the big guys.
They worry about business cards and websites, marketing and branding, features and functionality, scalability and platforms, partnership and preferred relationships.
Start small with a side business.
Keep your job, don’t invest more than a few thousand dollars, and just earn some side income.
Your Next Steps
Think about services, not what skills you offer.
For example, if you are a graphic designer, turn that into “I can help you create a memorable web page so you can convert visitors into email subscribers while making the most of your existing website.”
Brainstorm and write down your ideas.
Take a piece of paper and fold it in half. In one column, write down your skills and in the second column, write down a service for each skill.
Gut-check each idea and ask yourself 2 questions.
1) Does the prospect want this and do they have the money to pay for it?
2) Do I want to provide this and can I?
You may have a few ideas that are high on the list, so at first, you’re going to subjectively determine which single idea to test. If that doesn’t pan out, simply go on to your next idea.
Ask for advice.
Write down a list of 25 people who are prospects and experts for your product or service and ask for advice. Did you notice how that magic number 25 appeared at the beginning of this article too? That’s right; we did exactly the same thing to launch The LotusGroup Academy (business accelerator).
You have the initial steps to get started – are you ready to be an entrepreneur?