Category: Starting Up

New Webcomics series brought to you by #entrepreneurfail and GetEntrepreneurial.com. Enjoy!

If you can read this sentence without thinking about your next sales call, the line of buggy code you have to fix, the intern you must hire, or the appointment you are itching to make….then congratulations! You probably have better focus than many new entrepreneurs.

A key driver of a new entrepreneur is really a laser sharp, extremely directed, pinhole-perfect focus. This unwavering bullseye and motivation to get to a goal separates the successful and the mediocre startup founders.

Easier read than done? Here are some tips from experts who know the importance of focus

1. Identify what’s important to getting your first customer and nothing more
2. Implement one strategy at a time for growing your business. Move to the next one, once you have assessed all aspects of your current strategy.
3. Plan alone time and take breaks, as many of the successful entrepreneurs in this article do.  This allows you to recapture and recuperate in your mind
4. Set mini goals and mini prizes – e.g. 30 minutes undisturbed will get you 10 minutes of social media time
5. Publish a daily schedule and follow it. Give it to someone who will hold you accountable to those deliverables. Setting a schedule allows you to ‘be your own boss’ in a way where you determine what your future self would be doing and keep you accountable to yourself.
6. Include an exercise schedule in your daily regimen, as this allows you to consolidate your thoughts.
7. Say no at least 10x times than you say yes. Saying no lets you focus on your yes commitments.
8. Learn the art of meditating, which is essentially the art of practicing being focused.

Did we miss anything in the list above? Let us know in the comments below. 

This was originally created Kriti Vichare for #entrepreneurfail: Startup Success.

“My business is in trouble with debt spiraling out of control and I simply don’t have enough cash to make payments on time. I’ve read that most small business startups have problems similar to mine, but why?”

This concern is common amongst the directors, managers, and owners of small business startups in the UK, and for good reason – about 2/3 of startups fail within their first 3 years of operation. Usually the failure is brought about by a number of factors that work together synergistically to make business progression difficult. Here are the 4 most common reasons why small business startups don’t do well:

1. Inadequate Preparation

Starting a successful startup is all about planning – analysing your market conditions and competition. Some of the things you’ll need to know and have planned for:

• Who is going to buy your product/service
• How many companies are providing similar offerings
• Why your company’s offerings will be more appealing
• How much your competition is charging
• What it will cost to get the business of the ground and start an advertising campaign
• How much the business will need to spend to operate on an ongoing basis

2. Lack of Help or Too Much Help 

Operating a startup all by yourself can be a recipe for disaster. Things happen that we don’t expect, and when there’s absolutely no one else to fall back on it can be easier to become stuck in predicaments that result in missed deadlines and unsatisfied clients.

At the very least you should have a professional accountant on call and/or a general helper to assist with medial duties so that you can focus on the business.  At the same time, hiring too many employees prematurely can drain your cash flow and hinder your company’s ability to invest and progress.

3. Borrowing Too Much Money From the Start 

Most startup founders are a bit overzealous and as such have a tendency to overestimate their funding needs. The prospect of getting a £50,000 business loan definitely sounds tempting, but realistically you don’t even know if your company is going to be profitable yet.

Borrow only what you need to get started, and never borrow more than you’ll be able to pay back in the event that the business fails. If you’ve recently realised that you have too many debt obligations, you may want to consider debt consolidation or a company voluntary arrangement (CVA) as potential solutions.

4. Inexperienced Founders

Unless you’ve actually set up and managed a business before, there’s no way to know how it feels to deal with such pressure and responsibility on an ongoing basis. When you think about it, the entire endeavour is a learning process, as essentially everything you do is a new experience. For this reason there’s a much higher chance of making mistakes that could lead to the failure of the company in the long-term.

If you feel as though you won’t be able to recover from the current debt situation but you’d like to salvage some of the company’s assets before it is dissolved, you may want to contact an insolvency practitioner (IP) to arrange a pre-pack administration sale.

If your startup is not doing as well as you had planned there are still many recovery options that could put you in the 1/3 of those that succeed. Give us a call on 0800 644 6080 or send us an email and tell us about your situation. We’re trained and certified in business rescue so there’s no problem that we can’t help fix.

Article Contributed by Lori Wagoner

We are all victims of doing what is being told. It just seems like it’s the easiest thing to do. It also appears to be the most natural thing to do.

It’s just a drill. It’s like all those parents preaching kids to study hard, get a job, get married, raise children, and grow old gracefully.

There’s nothing wrong with that advice, except that you never asked the kinds what they really wanted. If it’s lot of money that kid wants to make, a job is the wrong path. If the kid is a natural loner and prefers it that way, marriage can be a nightmare.

See where this is going? Everyone dishes out advice without really thinking about – or at least asking you – about what you want.

Thanks to that thing called the internet, this advice is now everywhere. Including business advice.

So, what’s the first thing you hear when you say you want to start a business?

A business plan, that’s what. We’ll see if it’s good advice or bad advice. We’ll also assume that you are starting your business for one thing that most businesses are out there for: profits.

Here’s why business plans can actually kill your business:

You made a business plan for what?

If you are like most businesses, you create that business plan in the hopes that you can attract funds to help you launch and run your business. You’d present the business plan to family, friends, and potential co-founders or partners. You’d pitch the sustainability of your business to a bank, a non-banking lending institution, or potential investors.

But when was raising funds a good idea in the first place? Lending institutions will watch your business like hawks and investors come snapping at you like sharks. In most cases, you give up equity and you are at their whim.

Also, there are numerous instances of people who did raise money “without” a business plan. Here’s Rob May who raised funds for his startup Backupify without a business plan, while drinking beer.

What if you wanted complete control on your business and what if you wanted to “bootstrap” it?

Business plans are scripted. Is your business scripted too?

So you sit and think. For hours, days, weeks even. Then you’d put everything you know on paper. You’d do sales forecasts, finalize systems, and design processes and workflows. You’d include hiring plans, financing ideas, and a lot more.

So, what happens next? You’d ideally start your business. You’d try to follow the plan; you’d set things in motion.

The trouble is that we aren’t operating in a vacuum here. You start of well but rarely do things go as planned. Things change quickly. There are too many externalities out there for you to battle with.

It could also turn out that you might realize that a viable market for your business doesn’t even exist. So, you might have to pivot. Change courses. Change everything.

So what happens to your business plan? You’d need Plan B, C, D, or maybe no plan at all. You might just have to improvise and fly without a handle.

Suddenly your business plan doesn’t sound so sexy after all, does it? 

Business plans are an opportunity cost

Paul B. Brown of Forbes.com puts it right: in the time you take to do a business plan:

• You are still out of the market.
• You are looking to convince instead of looking for “fit.”
• You are giving others an opportunity to race ahead.
• You are barely noticing the market that’s changing.
• Meanwhile, there’s no revenue. No cash flow. Nothing else to show for it.

Planning time could be selling time

How long did you take to create your business plan? What happens when you use this time to go out and actually get some paying customers? What if you decide to go against the grain and hustle to get paying customers (not free birds, beta testers, or enthusiasts)?

This is time better spent. Also, paying customers give you the best, most actionable feedback compared to friends, family, and strangers you managed to get on social media to “try” your new product, before launch.

Finally, selling instead of planning helps you get into the flow and helps you decide if entrepreneurship is the best thing for you.

Planning distracts you from execution

Businesses fail, all the time. We all know that. We also rally around everywhere we go that “it’s not about the idea; it’s about the execution.” Why then do we labor so much on making plans that are likely to be changed soon? Why script something when you have to improvise anyway?

Business plans, on top of it, stifle creativity. These documents, spreadsheets and presentations kill any hope of your improvisation, standing on your feet to think, and deflect you from thinking about creative solutions to absolute certain problems that’ll pop up sooner or later.

Execution is critical to success. You’ll probably fail in spite of that.

Planning is good. So do spend a day with planning. Business plans can be on the back of your tissue or as a scribbled note on Evernote. For all that matters, it could be in your head or on the beach sand.

Business plans do have a purpose. But dwelling too much on just “planning” without doing something constructive isn’t going to help at all. You could be planning all your life and you could be “planning to fail.”

One quick way to know if your business succeeds or fails is to launch quickly. Get paying customers, and then work your way up from there.

Product or site launch is so simple today. Services and platforms like Shopify make it easy for you to set up a whole ecommerce store complete with templates with responsive design, point of sale systems integrated with mobile devices, credit card processing with no waiting times, shipping and customer service options, and everything else you need. Then what’s with the big “preparation” for the launch?

You could write a business plan after you make enough to do nothing maybe?

Think about it.

About the Author

Lori Wagoner is an independent content strategist who gives online marketing advice to small businesses. Lori has blogged at Tweak Your Biz, The Social Media Hat and many other business and tech blogs. You can reach her @LoriDWagoner on Twitter.

Attention budding entrepreneurs: How handy are you with tools?

Are you ready to get down and dirty and fix what needs it? I hate to break it to you but you have to be ready. Starting a company requires you to have the tools to fix anything that’s broken, coupled with the patience to make it happen.  Just as I have a reliable toolkit at home, to fix the leaks, creaks and freaks at my house, an entrepreneur must be able to do that for their own venture.

As Sir Richard Branson said: “Your decision will not always be the best decision. Everyone makes mistakes, but the best thing you can do in the face of a mistake is own up to it. Honesty isn’t just the best policy, it’s the only policy. When a mistake is made, don’t let it consume you. Uncover the problem and get to work on fixing it.”

So what are the components that should be in your toolkit?

1. Blue Prints – Make a plan for the future
2. Level – Level your expectations
3. Nail – Nail down your value proposition
4. Ruler – Size up the market
5. Saw – Cut through the clutter
6. Pliers – Get a grip
7. Wrench – Tighten a hold on your market
8. Hammer – Knock down obstacles
9. Screwdriver – Don’t screw up

 Did we miss anything in your toolkit? Do you have any special tools? Let us know below. 

This comic and post were created by Kriti Vichare for #entrepreneurfail: Startup Success.

Article Contributed by Mark Halstead 

There can be any number of reasons why a startup company might find itself heading out of business but it is worth focussing on some of the key causes and most common pitfalls.

1 – Failing to prepare

There is a lot that can go wrong for even the best prepared and battle-hardened small businesses but avoiding surprises is particularly vital for startups for whom a few sizable financial blows can spell disaster.

It is worth remembering too that dreaming about becoming a millionaire is not quite the same as proper preparation for running a startup enterprise. Enthusiasm and optimism only go so far and reality often has a horrible way of announcing itself in the context of startup operating.

Directors of small firms always need to ask themselves key questions and find the right answers but never more so than in the weeks and months before their startup gets started. It’s a cliché but it is very often true that failing to prepare is preparing to fail.

2 – Borrowing too much too soon

Startup companies should not always aim to borrow as much money as they can possibly access in the early stages of their development. In fact, borrowing too much money too soon can be the beginning of the end for many small businesses who never manage to get on top of their debts and their expenditure.

It is much better for startups to borrow only what they really need and to build a business from that basis. It can be difficult to curtail over-optimism in the early stages of a company’s progress but doing so might just make the difference between success and failure.

3 – Not enough help

Starting up a company will often bring out the best in ambitious entrepreneurs and an individual can achieve a great deal alone. However, effective delegation is an absolutely crucial aspect of leadership and of business management.

Getting too little help from colleagues, suppliers and service provides can be a recipe for disaster and a having no plan B can put unbearable pressure on people leading any enterprise. On the other side of the coin, however, taking on too many full time employees before the time is right can be a dangerous mistake as well. So striking the right balance between support and flexibility is vital.

4 – Inexperienced founders

There is no substitute for experience even when the fundamental ideas behind a startup company are solid and have great potential. The process of managing a business as it grows or as it faces setback after setback is extremely challenging and a lack of experience is very difficult to overcome. Everyone has to learn the ropes at some time in their career but the nature and the dynamics of running startup companies is generally very unforgiving of the missteps that can easily happen when directors are new to the business world.

Bio – Mark Halstead is from Red Flag Alert, part of the Begbies Traynor Group, and is now in his 10^th year with the business. He’s worked at companies across the financial services industry and is a fellow of the Institute of Sales and Marketing.