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]]>At the last Business Planning Class graduation, Wendy Lieu, graduate of the Fall 2012 Business Planning Class, shared her wisdom. As of owner of Socola Chocolatier, Wendy Lieu handcrafts delicious artisanal confections.
Wendy’s Lessons Learned
1. If you wait for perfect conditions, you’ll never do it.
There is never a perfect moment to start a business or take that next step. You will learn as you go along, so don’t wait for the right moment. You will always need to make changes and adjustments along the way. Some things will work and some things won’t. Pivot and keep on moving!
2. Start with one step.
Looking at your to-do list can feel overwhelming and sometimes paralyzing. You can get things done. You just need to start with #1. Prioritize and set short, attainable goals that can be completed in the day and the week.
3. Be obsessed with your numbers.
If this business is truly your calling, create a solid business plan and remember to review it every month. Track your numbers, review the results, and make changes if needed. Your financials are your key business metric.
4. Challenges are a given.
There will be difficulties, so get over it. Laugh it off if you need to and move on. Sometimes you’ll try something out and it doesn’t work out. You’ve lost some money. You tried. It seemed like a good idea but it didn’t work out. Now try something else!
5. Work out – keep active.
Sitting in front of a laptop all day will drain you. Your health is just as important, if not more important, than running your business. Your business starts and ends with you. Take care of yourself.
6. Treat your employees with respect.
Treat employees like family (that you like). Make sure they like working for you, are learning from you, and understand their contributions to the overall success of the business.
7. Surround yourself with successful business owners.
Other small business owners have experienced similar challenges. They can help you. If not, they probably know someone who can. You are not alone. Get out there and connect with others who are a few steps ahead of you and have already solved the problem you are struggling with.
8. Focus ON your business.
Don’t get stuck attending only to daily operations. You need to be paying attention to the business as a whole, its future and its long-term sustainability.
9. Dreams don’t work unless you do.
You will be exhausted and wonder if it’s worth it. That’s normal. Remember that you decided to forgo the easy path in order to control your own destiny. What you get in return is the pride from working on the thing that you are most passionate about. It reminds me of this Jim Carey quote…“You could fail at what you don’t want to do, so you might as well take a chance on doing what you love!”
We are curious to know which of Wendy’s lessons resonates most with you. And also, what words of wisdom have kept you going through the challenging times of new business ownership?
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Passion is essential
First, passion and conviction are essential. You need to know who you are and what you want to do. Then there is the choice of business model and knowing your product or service inside and out. You want to be ready to eat, drink and breathe business ownership… and wake up and do it again the very next day.
Know your market
Even if you have the best business idea and you are confident in your ability to make a product or provide a service and set up a successful business model, the great arbiter of success is the marketplace. Your business concept must be viable, not just to you, but to the people who will be your target market. How do you know your business expectations are not fiction? To get the answer, you must talk to people, survey potential customers or clients, and test your assumptions.
Test your concept
Once you have an idea of the marketplace, you want to test the concept. You can pop up in someone else’s space or test your product or service at a street fair or makers fair. You can get friends to hold events and sell your product in their living rooms. You can convince a friend who has a retail shop to let you set up a trunk show. If all goes well, the experience will make you feel more secure that your business idea is a good one and that you want to own and run a business.
Can you now say YES to these 5 key questions?
- Do I really enjoy being in business?
- Can I attract the customer or client who will appreciate my business and will pay for it?
- Am I good with customers and can I provide excellent service?
- Does my business model make money or will it at least break even “soon”?
- Can I envision myself persevering for the next 12 to 18 months to really establish my business?
Time for planning
Some degree of prior business planning is essential. To help guide you, you can take a class, read a book, or ask an experienced business owner for support. However you do it, the purpose of a plan is to define your business offerings, specify your market, outline the essential management skills needed, and create realistic financial projections with a well-timed series of action steps. Your final plan will be a useful document for potential investors, funders or business partners. But the primary purpose for writing a plan is for the process itself. It forces you to be objective and critical, identifying weaknesses, challenges and opportunities and setting benchmarks to track progress. Ultimately, it will give you confidence to get into and continue with the business.
Take the plunge
So you have made some initial sales, carved out time on weekends to work on the business and you are still excited about doing it. Actually, it is all you can think about. How do you take the plunge from part-time to all-in?
There are many different ways to do it.
- Wait to launch until you have raised enough start -up capital – either through personal savings, bank loans or crowd fundraising.
- Convince your friends and family to lend you money (perhaps with no interest) and agree that you do not have to pay them back for at least three years.
- Approach your employer and negotiate to work only four days a week and use that extra day to work on your business.
- Move from full-time employment to a contractual arrangement so that you can set your own hours and take time off when needed for the business.
- Find an active or silent business partner with capital to invest in the new business and cover business expenses for the first year.
- Marry well and/or use your future inheritance to support your entrepreneurship habit!
- Quit your job and go all in right away, using credit cards to get you through the cash flow negative start-up period.
The path to small business ownership is unique for each entrepreneur. It depends on your tolerance for risk, your access to capital and cash flow, your skills and experience running/managing a similar enterprise, and your support systems.
Time, money and the prospect of failure are common hurdles for almost every small business owner starting out:
- How do I find enough time to devote to my business?
- Do I have enough funds to support myself while the business is developing/evolving in the first 6, 12 or 18 months?
- Can I respond well to short-term failures as I navigate my way to long-term success?
You may struggle to find the right strategy to get your business off the ground but if you have passion for your business idea, some success from product or service testing, solid financial projections, and a strong support network… YOU CAN DO THIS!
Are entrepreneurs crazy? Sometimes yes. But that’s just what may be needed to jump in and swim! Some start in the shallow end of the pool and tip-toe down the stairs. Others lower themselves down the ladder until they are fully immersed but continue to hold onto the edge. And then there are the ones who leap off the diving board straight into the deep end. No matter your approach, just make sure you can see the edge and make your way back to solid ground as needed. But if you really want to swim in the world of small business ownership, you first just have to get into the water!
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Sean Patrick and his business partner opened a new burger and fries place in San Francisco’s West Portal neighborhood featuring burgers, fries and milkshakes made from 100% organic ingredients sourced primarily from California. (They even have a veggie burger for me!) Check out their recent San Francisco Chronicle review.
JoEllen Depakakibo just opened a new coffee shop on Cortland Street in San Francisco’s Bernal Heights neighborhood. The curated space features a variety of coffee roasters and other locally made goodies. Check out this recent profile of JoEllen and her new business.
Lindsey Hoell and her brother and sister have launched a line of surf bikinis! They are made in America of strong, stretchy material …and include zippered pockets. Check out their fun website and online store.
Melissa Myers opened her bottle shop and tasting room on Telegraph Avenue in Oakland, offering hundreds of craft beers from around the world, with mostly local beers on tap. You can enjoy your brew on site or take away, and attend their classes and monthly events.
Hoi Polloi Brewpub and Beat Lounge
Viet Vu opened his brewpub with his brother and wife on Alcatraz Avenue in Berkeley. The pub features a variety of beers, including their own creations, and all beer comes with popcorn drizzled with truffle-oil. Check out this recent San Francisco Chronicle review.
Courtney Cummins has launched Rilla, an online style boutique featuring select clothing, accessories and textiles from independent designers, as well as highly curated vintage pieces.
Michele LeProhn opened the doors to her neighborhood restaurant in Oakland’s Laurel district this December — seasonal American comfort food to eat there or to take home. Check out this recent article about Communitē Table in the East Bay Express.
Andrine Smith opened The ReCrafting Co. as a crafter’s resource for quality recycled crafting materials, supplies and tools. The shop also offers crafters a convenient opportunity to recycle their surplus crafting material and supplies on consignment for cash.
Tim Lee’s bottle shop and tap room opened in lower Nob Hill the Fall of 2014. The focus is on locally sourced beers and wines. In November, Liquid Gold made Zagat’s list of the 12 hottest new bars in the United States!
Steve Fox and his team have created Urban Putt, the City’s first and only indoor miniature golf course in San Francisco’s Mission district. It is a playground for people of all ages with organic and locally-sourced food and drink. Thrillist calls Urban Putt “quite possibly the best thing to happen to the Mission.”
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The term “encore career” is being used to describe a new career later in life—one that is focused not just on making a living but on making a difference. Encore.org—a San Francisco non-profit that helps people pursue “second acts for the greater good”—defines encore careers as jobs that combine personal meaning, continued income and social impact in the second half of life. And according to the organization, the idea is catching on. As many as 9 million people ages 44 to 70 are already in encore careers, with 31 million more interested in the idea but not sure how to make the transition.
For many, the encore career most appealing is starting a business. In 2012, nearly one quarter of all new businesses were started by people ages 55 to 64. According to the Ewing Marion Kauffman Foundation, business creation by older Americans grew more than 60% between 1996 and 2012.
So if you are interested in starting a business, where do you begin?
1. Follow your passion! Your business will only succeed if you love what you do. As Steve Jobs says, “The only way to be truly satisfied is to do what you believe is great work. And the only way to do great work is to love what you do.”
2. Know yourself well. Assess your strengths and weaknesses to determine if you have what it takes. Do you have some of the traits common to successful entrepreneurs? What are your existing skills? Older entrepreneurs have an advantage — at this point you probably have a good sense of what you love to do and what you can do well. Now, instead of doing that work for an employer, you can do it for yourself.
3. Get out there to connect and learn. There is so much to learn from others in the field. Read, take classes, join small business groups of like-minded people, find organizations focused on the issues you are passionate about, as well as organizations focused on senior entrepreneurs. Starting a business can be a risky endeavor but much less so when you have relevant skills, a sense of the marketplace, and an understanding of what others have tried already and what has succeeded or failed. (Renaissance Marin offers a class called Encorepreneurs, based on The Encore Career Handbook by Marci Alboher.)
4. Don’t do it alone. Starting a new business can be a significant undertaking. You need a strong network to help you navigate through the rough patches and mentors who will share sound guidance. It is important to surround yourself with supportive and insightful people. As someone with life and career experience, there is a good chance you have a strong network of contacts already — people you can turn to as a support system and people who might eventually be customers or clients.
5. Use all the business tools you can find. There are many non-profit organizations and government agencies committed to helping people start their own small businesses. In San Francisco, the Office of Small Business is a great resource, with a helpful step-by-step guide to starting a business. Technology has made it a lot easier to start a business, too, with online tools like License 123 for finding all the licenses and permits you’ll need. Check out our website for more resources.
6. Money, money, money. There are many small and home-based businesses that can be launched without much start-up capital. No matter your size, knowing the resources you have and projecting what you may be able to earn is critical. How much do you need to make each month to cover expenses and make a profit? What are your start-up costs and how will you fund your transition? There are many ways to fund your business, with crowdfunding platforms becoming an increasingly popular strategy.
7. Make a plan! Your plan doesn’t need to be lengthy but it’s helpful to give some thought to marketing, money and management before you begin. A business plan can force you to clarify your idea, understand the external conditions that might affect your business, and set realistic goals with benchmarks to track your progress. Doing the research, talking to people and creating realistic financial projections will give you confidence to get your business started and keep it going. Renaissance Entrepreneurship Center offers a 14-week business planning class to help you through the process.
Above all, what’s most important is to get out there and keep learning. Starting a small business is tough but it can be so rewarding both for the people you serve and the person you become. You are never too old to learn something new and make a difference.
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