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Trick or Treat for Entrepreneurs

trick or treat for BIGG SuccessThis, the tale of an entrepreneur,
Who was not sure he could endure.
The times, you see, had been quite rough,
He was not sure he was tough enough.

So he sought advice from a wise old sage,
On Halloween, to get a gauge,
Of whether to continue or not,
He would let the sage decide his lot.

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Sherlock Holmes Reveals 3 Elementary Steps to Starting a Business

221b Baker Street | BIGG SuccessWe love Sherlock Holmes in all his varieties, including the 21st century Sherlock Holmes. But our favorite is the Sherlock Holmes series with Holmes played by the late great Jeremy Brett.

We recently watched an episode where Holmes reveals his secret to solving a crime. We were struck at his outline – it’s the track a will-be entrepreneur should follow to start a business.

Of course, solving a crime is a backwards-looking exercise. Starting a business requires you to look forward. So other than a change in tense, here are Sherlock Holmes’ three elementary steps to starting a business:

Step 1: Imagine what might happen

You must see the invisible when you start a business. It’s part science, part art.

Picture what might happen. Successful entrepreneurs know they can’t predict what will happen.

As you create the image of your start-up, write it down.

  • What are you selling?
  • How are you selling it?
  • Who is buying it?
  • How will you deliver it?
  • How will you measure success?

To borrow from Holmes, put an “exactly” in front of each question. This isn’t even close to being an exhaustive list of questions, but you get the idea.

We remember a mentor telling us that the most successful entrepreneurs could clearly picture what their business would look like. You should be able to do the same.

And don’t just picture one scenario. Think about what could happen to derail you. How would you respond? You’ll be better prepared to deal with alternative scenarios if they materialize by imagining them in advance.

Also picture the amount of time and money it will take to reach profitability. Hint: Plan on it taking at least two to three times as long and costing at least two to three times as much as you think. Make sure your vision is realistic.

Step 2: Act upon your supposition

It’s fun to imagine. Acting is where things get difficult.

At launch, every start-up is nothing more than a hypothesis. It’s a theory about a product and a market.

You’ll learn a lot about your product, your market, your people and yourself when you launch. In fact, it’s where the learning really begins.

You may think you know before you launch, but remember it’s all hypothetical. You launch to find out what’s real.

Step 3: Find yourself justified (or not)

As you discover reality, your hypothesis may prove to be correct. Congratulations! Keep pushing.

More likely, you will find that you missed the mark in part or in whole. Adapt.

You may tweak what you imagined. Or you may discover a completely different business. In either case, you win by getting started.

Sherlock Holmes had an advantage over entrepreneurs. His job was to go back in time to discover what happened.

Entrepreneurs must start from scratch to create their future. The key is to get started. It leads to BIGG success!

Are you thinking about starting a business? Maybe we can help.

We hope you can detect how thankful we are that you checked in with us today.

Please join us tomorrow when we’ll talk about the three influencers of career success. Until then, here’s to your BIGG success!

 Image in this post from linder6580

The Less Money You Have the Better!

penny We were talking with one of our banker friends recently about start-ups. He said that people often look for money when they should ask if there’s a better way to run their business. Money isn’t always the best solution.

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In fact, sometimes not having a lot of money to get started is a good thing because it forces you to be innovative and look for ways to save money. Obviously, it is possible to have too little money. Most of us have probably experienced that a time or two.

The baker

He told us about a person who wanted to start a bakery. She thought she needed a storefront. Our banker friend asked her who her customers would be. She said it would be friends and family at first. Then she expected word-of-mouth to take it from there. So he suggested that she just use her own kitchen or find a way to use a commercial kitchen part-time, instead of spending money on rent, utilities and all the other costs of maintaining a store. She didn’t need much money if she used this operating strategy.

An internet business

A friend of ours is putting together a really cool web site. They want to have an active community. They were going to pay a developer quite a bit of money to put together the forum area. We talked him into using open-source software and having it custom designed after his community starts building. He cuts his start-up costs drastically!

A chiropractor

Our banker friend knew a chiropractor who thought he needed to rent office space so he had a place for his patients. Instead, he found a fellow chiropractor who had extra space. He rented from this chiropractor for five years. Then he secured his own location – one he knew he could afford based on the income stream he had established.

He reduced his risk and conserved money by finding a better solution to get started. Because if you build it, they may not come. Test it out first!

The average entrepreneur starts his or her business with around $25,000. Sometimes the less money you have the better, because it forces you to think creatively and spend every penny wisely. Here are two entrepreneurs who did just that …

Bear Naked

Kelly Flatley is the co-owner of the all-natural snack food business, Bear Naked.
When her business was young, she didn’t go out and rent a large space to manufacture her product. No, she negotiated to use the commercial kitchen at a local market after they closed. She manufactured at night and made deliveries to her retail customers during the day. 

Sure, she worked some crazy hours. Don’t most entrepreneurs? That’s a concession for not having money. If you’re undercapitalized, you may have to get creative and make it up with “sweat equity”.

Newman’s Own

Years ago, we heard the story of how one of our favorites, Paul Newman, started Newman’s Own – his food products company that has donated millions to charity. The details here probably aren’t fully correct, but that’s not as important as understanding what he did.

He invested a small amount of money to start his business. He contracted with one company to manufacture the product. Another company sold it to grocery stores. He outsourced almost everything. His business was bringing in millions a year in sales, yet it only had one or two employees!

He did all this with very little money, but a whole lot of creativity! You can do it too!

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Next time, we’ll discuss how something as simple as the font you choose can get people to do what you want. Until then, here’s to your bigg success!

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Can We Talk You Out of Owning Your Own Business?

questions Intuit, the makers of QuickBooks software, conducted a study of working adults [doc] not long ago. They found that 67 percent think about quitting their jobs regularly or constantly, while 72 percent said they want to start their own business. The number one reason cited for this was to be more passionate about their work.

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The participants were asked who inspired them: Donald Trump (38%) and Hugh Hefner (34%) were the top choices for men; Oprah Winfrey received 66% of the women’s vote.

That response made us think – there are misperceptions of what it means to own a business; what an entrepreneur faces day-to-day. There’s the Hollywood version, but it often doesn’t reflect the real world.

5 common myths about owning your own business


#1 – I won’t have to answer to a boss.

While technically true, it’s not accurate in practice. The reality is that, as a business owner, you answer to every customer by you and your firm. You answer to your banker if you borrow money. The government will require you to do certain things by certain times. As a business owner, you won’t have a boss; you’ll have many bosses!

#2 – I set my own hours.
You’ve probably seen or heard the ads. Just buy this business opportunity – you’ll hardly have to work and the money will just pour in. If only it worked that way! You may enjoy a great deal of flexibility as a business owner. However, you’ll probably work more than you ever imagined, especially in the early stages of your business.

#3 – I can get my employees to do the grunt work.
Many new business owners – formerly part of the corporate world – have trouble adjusting to the lack of resources that are inherent in many start-ups. They were used to having “people” who did certain things. Start-ups can’t afford extra people; many can’t afford people at all! You’ll have to get used to doing a lot of things, if not everything, yourself, even the dirty work.

#4 – I’ll make more money.

Start-ups consume money; there often isn’t much to spare. You may not get a regular paycheck at first. You’ll have to build up the business to afford that “luxury”.

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georgeWhen I was younger, I couldn’t find anyone willing to pay me what I thought I was worth. So I started my own business … I quickly realized that I couldn’t afford to pay me what I thought I was worth!

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#5 – I’ll have less stress than I do with my job.

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marylynn As a first-time entrepreneur, I’ve learned that stress hits from many angles – clients with deadlines, so much work to get done, and worries when things don’t go as planned. I’ve learned to be much tougher mentally and emotionally.

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All of this reminds us of Jackson Browne’s song, The Load Out …“They’re the first to come, and the last to leave, working for that minimum wage.”

In the song, he’s talking about roadies. But we wonder … couldn’t he be describing start-up entrepreneurs?

When your business is in the start-up phase, it’s like a newborn baby. You have to nurture it and care for it until it reaches the point where it doesn’t need you so much anymore. Prepare yourself for a five-year horizon before you start.

If starting a business doesn’t sound so good anymore, we feel like we’ve done our job. You won’t face the financial, and more importantly, the emotional turmoil that comes with a start-up.

However, if you’re now more determined than ever to start a business, you’ve passed a critical test. You can’t be talked out of it. You’ve peered beyond the popular and romantic view of business ownership. You’re starting to see it as it really is. You’re ready to become an entrepreneur!

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Get the tips and tools you need to be a BIGG success.
Subscribe to the Bigg Success Weekly – it’s FREE!

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Next time, we’ll discuss the art of knowing yourself. Until then, here’s to your bigg success!

Subscribe to The Bigg Success Show in iTunes. 

Subscribe to the Bigg Success feed.

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Don’t Fear the Banker!

A lot of us are very uncomfortable talking about money, whether that means negotiating your salary, asking for a sale, or asking for a loan. So the thought of going to the bank to get a loan can be very intimidating.

The loan process seems somewhat mysterious. Wouldn’t it by nice to know where bankers are coming from? Then you would be better positioned to get the money you need.

3 things to understand about your banker

#1 – Banks can’t afford to lose money.
A lot of people don’t realize that banks operate on relatively thin profit margins. So, contrary to popular belief, they don’t make that much money on every loan.

The biggest question every banker has when looking at every loan proposal is …

Will we get paid back?

They’re more concerned about the return OF their investment than the return ON their investment. That comes later.

#2 – Banks don’t fund start-ups.

This is perhaps one of the biggest misperceptions in the business world. People think the bank is the best place to go for money they need to start a business.

To which we say, reread our first point! Bankers are relatively risk averse for the reasons stated above and more. So banks don’t tend to lend money to new, unproven firms.

You might be saying, “But I know people who got money to start their business from a bank.” Here’s the distinction – the bank wasn’t loaning money to their BUSINESS; they loaned them money as individuals FOR their business. If you look deeper, you’ll find that, in almost every case, they secured the loan with equity in their house or some other asset.

#3 – Banks need to lend money.
That’s their business. So if you need money, and you can prove that you can pay it back, and you have some assets to secure the loan, go to the bank with confidence!

Your bank is just like your favorite video store.
Video stores rent DVDs for a fee. Banks rent money for a fee. So going to the bank is just like renting a movie. You have to return the movie and pay a fee. And hey, unlike video stores, bankers don’t charge their fees upfront!

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Our bigg quote today is by the great Stephen Covey:

“Seek first to understand, then to be understood.”

Understand your banker’s needs so you stand to get your money needs. 

Next time, we’ll discuss how to offer criticism without being critical. Until then, here’s to your bigg success!

Subscribe to The Bigg Success Show in iTunes. 

Subscribe to the Bigg Success feed.

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