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The Trap That Catches Most Entrepreneurs

trapMany people start a small business to replace a lost job. Many people already in business say they’re just trying to “make a good living.”

If you adopt the same mindset, you’ll end up in the trap!

BIGG success is life on your own terms. It’s about designing and building the life that fits you perfectly. The focus is on making a life, not just a living.

If you don’t think that BIGG, you fall into the trap: Your days are so full of “busy-ness” that you don’t have time to develop the business.

You can’t get out of the trap. You work for the business but the business doesn’t work for you.

Listen to this post, click the player to hear George & Mary-Lynn on The BIGG Success Show podcast.

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[haiku url=”http://traffic.libsyn.com/biggsuccess/00687-040711.mp3″ title=”The BIGG Success Show #687″]
How do you avoid the trap?

Don’t sell products or services. Promote a brand instead.

However, promoting a brand isn’t enough. Develop your business.

Even developing your business isn’t enough. Focus on building a life.

To make a life, not just a living, from your business:

  • You must have an exit plan.

    Your exit plan is your compass. It sets your direction. It’s the end you must have in mind at the beginning, according to Stephen Covey.

Yet most entrepreneurs we talk with never think about their exit plan. They object – they say they don’t ever plan to exit their business. Fine – but a business is a very illiquid asset. You need a plan for liquidity.

  • Select strategies that move you closer to your exit.

    Strategic planning is mostly about eliminating options. Get everything that doesn’t move you toward your end goal off the table.

Once you do that, you’ll only be looking at strategies that work for you. You want to select the one that you think will get you to your exit in the shortest amount of time possible.

  • Be prepared to adapt or abandon.

    Your strategy may not work. It may need to be tweaked. Or you may find it’s just wrong. You need to abandon it and try another one.

You never know what will happen when your idea hits the market. However, proactively pursuing an exit while reacting to market information quickly and decisively leads to BIGG success!

Do you want to make a life, not just a living? E-mail us at bigginfo@biggsuccess.com or leave a voice message at 888.455.2444. Maybe we can help you.

Direct link to The Bigg Success Show audio file | podcast:
http://traffic.libsyn.com/biggsuccess/00687-040711.mp3

Image in this post from mrktwain

Think Like an Entrepreneur

a chess game which has similarities to having to think like an entrepreneur“Failing to plan is planning to fail.” ~ Ancient Proverb.

“Begin with the end in mind. Then put first things first.” Stephen Covey, The 7 Habits of Highly Effective People*.

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In business school, we’re taught to define our goals, given our available resources, and then find the critical path to reach them. This is called causal or predictive reasoning, according to Saras Sarasvathy.

She teaches entrepreneurship at the University of Virginia and is the author of Effectuation: Elements of Entrepreneurial Expertise and recently released an updated version of this book in paperback.

She says that successful entrepreneurs don’t think like MBAs. In fact, they do the opposite. They use effectual reasoning. Entrepreneurs who reach bigg success use the resources available to them. They let goals manifest themselves over time given their creativity, direction and connections.

Entrepreneurs think differently than MBAs

There’s a great article on Harvard Business  site about Dr. Sarasvathy’s research. It asks if MBAs or entrepreneurs are better suited for today’s business realities. Bill Taylor, the author, says it simply:

  • MBAs focus on the upside; entrepreneurs focus on the downside.
  • MBAs assume it’s a zero-sum game; entrepreneurs think win – win.
  • MBAs thrive on certainty; entrepreneurs thrive on uncertainty.

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george I’m even more confused than usual. I just don’t know what to think since I sort of fit into both categories!

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marylynn
Do you feel like you’re getting pulled in both directions at once, George?

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george
I feel like I’m getting stretched like Stretch Armstrong!

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marylynnWell, there is an answer. You just have to know when to use causal reasoning and when to think effectually.

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We define bigg success as life on your own terms. You are the entrepreneur of an incredible enterprise – your life – whether or not you’re an entrepreneur in the traditional definition of the word.

That’s why we think this research is so fitting not just for business owners, but for everyone:

When things are uncertain, think like an entrepreneur.

It appears that, in the years ahead, we need to expect more of the unexpected. Entrepreneurs don’t bother trying to predict the future; they create it.

How do they do that?

They act and adapt.

They use the resources they have to try something. If it doesn’t work, they take the knowledge they gained and try something else.

If it does work, they keep pushing it. As their enterprise grows, when there is more at stake, they may switch to more causal reasoning. Or they may jump ship and start the whole thing over!

Because to many entrepreneurs, the journey is the reward. That mindset often leads to bigg success.

Thanks so much for reading our post today. Please join us next time as we discuss when the dream becomes a nightmare. Until then, here’s to your bigg success!

Direct link to The Bigg Success Show audio file:
http://media.libsyn.com/media/biggsuccess/00447-072809.mp3

A link with a * denotes an affiliate link. That means if you click that link and make a purchase, we will make a nominal fee for making the referral.

If Elvis was an Entrepreneur

exitThe final chord was sung. The noise from the crowd became a roar. The lights came on. But there was still hope … still a chance that he might appear again. And then there was the voice, saying …

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Elvis has left the building.

You’re probably familiar with those famous words. It made us think:

Elvis always knew how he was leaving the building. If he was an entrepreneur, he would surely know how he was leaving the business.

Learning from the pros

Bankers and venture capitalists know at least two ways that they’re going to get their money back (plus the return they need) before they invest in our business. Shouldn’t we know at least one? It’s one of the lessons we can learn from these professionals.

Why you should know how you’ll exit

In 7 Habits of Highly Effective People, Stephen Covey taught us to begin with the end in mind. We should know how we’re getting out of our business before we get into it.

Know your exit. Elvis did. Professional investors do. Yet many entrepreneurs never think about it.

That may be a reason why studies show that a majority of entrepreneurs don’t expect their business to kick in any money for their retirement.

It’s crucial to consider your exit because small businesses are highly illiquid by nature. Unlike shares in a public company, there is no marketplace where you can go to sell it immediately.

Another reason to know your exit – perhaps a more important reason – is that it your exit should be one of the drivers of your business strategy. How you plan to get out affects everything from how you structure your business, where you get money from as well as a number of other things.

3 common exit strategies

  • Sell your business outright
    Just like selling a house or any other asset, you exit the business by giving up any claims to ownership in exchange for an agreed-upon price. On your way out, just say, “Thank you … thank you very much!”                   
  • Redirect cash flows
    Let’s say you invest $25,000 to start a business. Let’s also assume that you make $25,000 after-taxes in your first year in business (after fully compensating yourself for your time).

    Further, let’s stipulate that you don’t need that money for your existing business. Take that $25,000 out and invest it somewhere else.

    You invested $25,000 and you took out $25,000. Essentially, you have no money invested in the business. Yet you still own the business! Get your money out and say, “Thank you … thank you very much!”                     

  • Recapitalize
    You still own the business with this strategy as well. Let’s say that you invested $25,000 to start your business. You got your business started, built it up and are making money.

    You may be able to go to your banker and borrow against your business. Let’s say your banker agrees to a $25,000 loan which you can pay back from the cash flows of your business.

    It’s likely that you’ll need a good use for the money to get your banker’s okay. For example, maybe you have an opportunity to buy a piece of real estate that will house your company.

    In essence, you’ve cashed out of your business because you now have that original $25,000 invested somewhere else. Repeat this strategy over and over until you have enough money to fund the life of your dreams. That’s bigg success!

Thank you … thank you very much for reading our post today.

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Would you like more tips and tools to live your life on your own terms?
Subscribe to the Bigg Success Weekly – it’s FREE!

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Please join us next time when we ask some questions about work – life balance. Until then, here’s to your bigg success!

Subscribe to The Bigg Success Show in iTunes. 

Subscribe to the Bigg Success feed.

Direct link to The Bigg Success Show audio file:
http://media.libsyn.com/media/biggsuccess/00424-062509.mp3

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When Life on Your Own Terms Creates Conflict

problematic.jpgBigg success is life on your own terms. We recently talked about how empowering it is to define your terms.

We got a great comment by Andrew R. Timms about this. He says, “… just because we decide on our terms doesn’t mean the rest of the world is going to agree or accept them.”___

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Andrew raises a very good point. It’s something we need to keep in mind as we seek bigg success

What do you do if life on your own terms creates conflict with the people around you?

Andrew goes on to say that, in some cases, a person may think that your terms are keeping them from living their life on their terms. He suggests that we assume that they’re right! Then we’re at least common ground. Now with that in mind, we can explore solutions that work for both of us.

That’s an excellent suggestion. It’s Stephen Covey’s “Seek first to understand.” We have a personal example of this.

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marylynnBefore we were married, we both talked about our career goals. I was in radio and life on my own terms meant growing as a broadcaster and sharing my talent with more and more people. That meant moving to a larger market.

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georgeI was in business for myself and teaching part-time at our local University. I loved what I did, but my businesses were here as was my part-time gig. Life on my own terms meant growing without moving.

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marylynnThese weren’t the only factors at play, but they were definitely part of the equation.

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george
So we had conflicting terms and we started looking for solutions.

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marylynnThat’s when the idea for Bigg Success came up. It allowed me to broadcast to the largest audience I could imagine – the whole world!

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georgeIt allowed me to expand my business without moving. The conflict forced us to work together to find a solution. Because of that, we both found a better opportunity than we would have had otherwise. That’s synergy!

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What if you can’t find common ground?

We were able to find a solution that allowed both of us to live our lives on our own terms. But what if we weren’t able to do that?

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marylynn

Let’s say I was determined to stick with radio.

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georgeEarlier, we alluded to the fact that there were other factors at play in how we got to Bigg Success. And Mary-Lynn, I think what you saw in the future of radio is one of those factors.

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marylynnYeah, the industry was, and is, going through some significant changes. I felt like there was a lot less opportunity for me to really grow like I wanted to, if I stayed in the business. But let’s pretend that wasn’t the case. I would have had to move for my next bigg opportunity and, George, that would have meant a long-distance relationship for us.

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Life on your own terms isn’t idyllic

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georgeNow that’s not how either of us defines life on our own terms. But there’s an important point to understand here – life on your own terms isn’t idyllic. It involves setting priorities. A long-distance relationship may not be consistent with life on my own terms. But I’d rather do that than not have a relationship with you at all, Mary-Lynn.

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marylynnWe’d both be living life on our own terms, career-wise, but obviously not the way we would prefer in our personal lives. Sometimes you can’t have it all and you just have to accept that.

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It’s a timing problem

But here’s the key – we may have to accept it for now. In the meantime, we keep looking for solutions and opportunities that get us to our ideal life, to life on our own terms. In most cases, it’s a timing problem, not something we have to accept for our whole lives.

We’re talking about the closest of relationships here, the relationships on which you place the highest priority. In other relationships, the dynamic may change as a result of living your life on your own terms. You’re willing to accept that because you know you’re headed for bigg success!

What do you do when your terms conflict with others?

You can share that with us by leaving a comment below, calling us at 888.455.BIGG or sending us an e-mail at bigginfo@biggsuccess.com. Thanks Andrew for your thoughtful comment. And thank you for reading our post today.

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Would you like more tips and tools to live your life on your own terms?
Subscribe to the Bigg Success Weekly – it’s FREE!

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Join us next time as we help a member of our community who’s looking to get back into the workforce after an extended time off.

Until then, here’s to your bigg success!

Subscribe to The Bigg Success Show in iTunes. 

Subscribe to the Bigg Success feed.

Direct link to The Bigg Success Show audio file:
http://media.libsyn.com/media/biggsuccess/00368-040809.mp3

Related posts

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These Forgotten Costs Often Sink Us

sunken_boat We try not to make financial decisions in a vacuum. We strive to factor in all the relevant pieces before making a major purchase. But there are some costs that we often fail to factor in that can make a significant difference.

We often fail to factor in future flows of money.

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We expect a certain percentage pay raise. So we spend money as if it has already happened. It’s especially important in times like these that we don’t spend money before we know we have it.

Another thing we often do is count on a bonus. If it doesn’t materialize, we’re in trouble as we learned from Clark Griswold in Christmas Vacation. We sure don’t want our brother tying up our boss!

What about increased insurance costs? Is it likely that you’ll pay more for health insurance next year? How about insurance for your house or car? Insurance costs can rise significantly from year to year.

Do you have a variable rate mortgage? Have you considered a projected increase in the rate and the associated increase in your mortgage payment?

Have you thought about what might happen with recurring expenses? Cable bills, power bills, and water bills all seem to rise from year to year.

Affording it now isn’t good enough

You may finance a major purchase. Sure it’s only $100 a month. You can cover it now. But if it stretches your budget to its limit, it’s likely you won’t be able to cover it next year. You’ll start sinking and soon end up underwater, in a financial sense. You’ll run out of money before you run out of month!

It’s important to have a safety net – spending less than what you make each month.

A tool businesses use

We often don’t think about it this way, but we all run an organization – our households. Just like any organization, we have inflows and outflows of money.

Reasonably sophisticated business people work from a budget. Yes, the “b” word. Many people do treat budgets like a dirty word. But they’re a great tool.

And they’re especially important if you don’t have any money left over at the end of the month. It’s important to understand why. You can use Quicken, Excel or any number of ways to create your budget.

Many business people don’t just budget for one year. They look at projections over three years or more. These budgets don’t have to be elaborate – just plot out your main sources of inflows and outflows.

The power of the tool

Once you have a budget set up, you can look at “what if” scenarios. For example, what if:

  • you don’t get a pay raise
  • you (or your spouse) lose a job
  • the cost of health insurance (or any other cost) rises more than you expect?
  • you make this major purchase?

When you create a budget, you’re applying Stephen Covey’s “begin with the end in mind” and “put first things first” (from The 7 Habits of Highly Effective People) to your finances. You’re considering all your costs – both now and in the future. Then you can see the impact of major purchases on your overall finances so you make the best decision going forward.

You can run your finances intentionally, rather than ad hoc. You can prepare for contingencies so you survive no matter what. Then you can shift your focus to thriving!

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Get the tips and tools you need to be a BIGG success!
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Thanks for stopping by today. Next time, we’ll discuss how assumptions we make about time leave us overextended. Until then, here’s to your bigg success!

Subscribe to The Bigg Success Show in iTunes. 

Subscribe to the Bigg Success feed.

Direct link to The Bigg Success Show audio file:
http://media.libsyn.com/media/biggsuccess/00266-111708.mp3

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