A banker friend broke off from his organization to run his BDC (Bureau de change) business. While still a banker, he rightly observed a gap in the supply/demand chain in forex business, so he set up a BDC company and used his position in the bank to oblige loan facilities to his customers who in turn, patronized his BDC company. Business blossomed. His BDC biz grew so much so that he made ten times his bank salary monthly. He lived large. Bought latest models of phones, cars and all known gadgets. Bought properties. Any event called for partying. He reasoned he could triple his total income if he devoted all his energies to this business. He then broke out from paid employment to fully concentrate on his thriving BDC venture. Summary, exactly five months after, the BDC business rolled to a stop. What happened? Many reasons but key is that his former colleagues in the bank could not sustain the loan facilities to his BDC customers. Other banks did not trust the 'purpose' of the facilities so could not oblige them either. At some point, he could not also obtain enough personal loans from banks to sustain the purchase of his weekly BDC allocations of $200,000. He sold some investments. Worse, he discovered that overtime his 'importance and trustworthy' perception levels from customers dropped because he was out of the bank. His customers sought other BDC companies. Because he has enlarged the expenditure levels and were he to seek a return to the bank, his 'meager' bank salary would no longer accommodate his current appetite for the good life, so he got stuck.
Another friend ran a boutique alongside her regular job in a blue chip company. Within six months, her boutique was the talk of the town. Top notch clients patronized. Sales boomed and she traveled to London bi-monthly to replenish stock. Sadly, her boutique collapsed two months after she resigned to 'give the biz the needed push' to the next level. Why? She promptly sacked her manager-sales lady whom she felt was too accommodating to those who visited just to 'price and waste their time.' The manager could not take simple instructions to walk off those 'idle visitors.' She embarrassed the manager before clients. She quarreled with key customers. Gradually, patronage dropped. Clients preferred the exceptional customer service and relationship management style of the sacked sales lady. Many left in solidarity with the sacked sales girl. Being impatient and lacking in customer retention skills, she shut down. Pride could not let her back to her former job.
Finally, a ward yet to complete tutelage secretly ran a sachet water business. As the business grew, he pleaded with his master alongside his family members to discharge him before the completion of his wardship tenor. He was reluctantly let go being very hardworking. He then plunged into his business. Initially, he counted his hundreds of thousands weekly but shortly, emerging competition, new distribution methods and changing customer preferences in the business choked him out. He could not return to his master. His family could not help.
So finally, you have made up your mind. The die is cast, the bridge is burnt, there is no going back. You've made that decision to resign your job or to break out from your mentor to take your destiny in your hands; to become an entrepreneur. Yet in spite of your brags and assurances of a great world to come painted to convince people; at very sober and lonely moments, an overwhelming fear and doubt still creeps in and envelopes you reminding you of those mentioned above who travelled your intended route but failed. So many questions cross your mind. Am I right? Am I making a good decision? Are my permutations correct or exaggerated? Are my projections figments of my imagination? Will i make it? Will I have the market for my products or services? So many questions, but the only assured position is that you are determined to take on the world in spite of all.
I encourage you to prayerfully think again and again and possibly engage a coach. You see, unless you already have a business set up, running alongside your current occupation which is usually encouraged, there is still no fool-proof guarantee that giving your new business a full time shot will generate all the sales towards profitability and sustainability as narrated in our stories above.
In your case, you may not have the privilege of by-the-side business, yet your entrepreneurial spirit is asking you to quit and take your destinies in your hands. Note this; according to the U.S. Small Business Administration (SBA), a third of all start-up fail within the first two years, and almost 60% are doomed to fail by their fourth year.
If after all these information and you still insist to quit, I say a big congratulations to you. I perfectly understand. I travelled that route. In fact, you may still nurse some little fears as you read this, if you are within making such decision. The fear is perfectly in order. It is very normal to experience those heart thumping moments as the break-out day approaches. In spite of all, I'm in total agreement with those who advocate the need to try out your desired business first while still in employ or tutelage, unless you were suddenly laid off. If not, learn the few lessons you can while till engaged, then progress with it. Sadly, my grouse with this position is that most organizations presently sap out every minute of your life that there is usually nothing left for your new enterprise. Life is a continuous school. So go on and fear. In fact with the benefit of hindsight, I strongly feel that the more paranoid you are, the more the hunger and possibility to succeed. So go ahead and experience genuine fear, so long as it does not dovetail to numbness or paralysis. The great entrepreneur who was once sacked, saw the erosion of his entire savings, who revolutionized computers, tablets and phones, breathed and lived change and eventually bounced back-Steve Jobs says, "Everything around you that you call life was made up by people that were no smarter than you and you can change it, you can influence it, you can build your own things that other people can use."
So what should you do first to succeed as an entrepreneur or a business start up? I strongly advise that you do the following to avoid or mitigate to large extents the possibility of failure.
Before you decide to take on the world by yourself, you must first take stock of what you are bringing to the world's business or ideas table. Simply, what do you want to do? What skills, competencies and capabilities do you have that the world will value and perceive as a solution if not immediately but in a few months if you persevere. What do you enjoy doing that you are so passionate about to even do or offer trainings on free of charge, if compelled. It could be caring for people, leadership, organizational, acting, selling skills, IT, coaching, presentation, audit, business, and thousands of other competencies. Has it not bothered you that except for core professional courses like, medicine or law, most blue chip organizations seeking entry level recruits presently care less about courses of study.They seek for skills and competencies from potential employees. World over, differentiating skills, products or services, at the right time and place currently rule our world. What exceptional contributions can one bring into the market. So I advise. Take a stock of your skills and focus on your areas of strength. Have you noticed a gap in the market you want to fill? Do you have value, solutions or benefits you want to pass on? Can you take that competence to the market and it will be valued now or over time? First confirm this and obtain genuine feedbacks before you quit.
PPP- Passion, Persistence and Perseverance:
"I'm convinced that about half of what separates the successful entrepreneurs from the non-successful ones is pure perseverance.... Unless you have a lot of passion about this, you're not going to survive. You're going to give it up. So you've got to have an idea, or a problem or a wrong that you want to right that you're passionate about otherwise you're not going to have the perseverance to stick it through." Steve Jobs. So much has been written about enthusiasm, passion, persistence, perseverance, etc. Anyone that has a combination of these values carried into a venture succeeds. Anyone! It is guaranteed principle. It is assured! Enthusiasm and passion are contagious. They attract people/clients to you. So, are you enthusiastic about that business or service? Are you passionate about it? Will you persist (which someone defined as the willingness to learn from rejection without losing enthusiasm) and persevere against any odds? I bet you have succeeded already if you do. The whole essence of business is to win. Be sure you are overtly enthusiastic about your venture. Let the whole world know. Share it. Discuss it. Live it and be present wherever a related event or activity is on.
How much do I have and how much do I need:
Often times, specialists recommend an accumulated savings of about two years salary before break out. Others recommend one year. Some others think six months should do it. Let me shock you. I recommend no savings really! Actually, I mean, do not have much. I may not be very serious here but depending on emotional levels, one or two years salary can actually lead some people to comfort and complacency. One year is long but extremely short. Same for two. I have come to realize that hunger and being paranoid is a common denominator that galvanizes entrepreneurs to success. Personally, before I left the system, I had thought I saved up some funds but as my notice-to-quit-date approached, some complex events swooped up on my savings. But because of my strong spiritual and psychological readiness, I aggressively took on the challenge from same minute that I left. You succeed to the extent that you are hungry and passionate. The world always makes a space for the hungry. Show hunger and passion and they will make a space willy-nilly. Have you noticed kids of about the same age in a Nursery class. All could be hungry but the one that shrills the most gets instant attention, and biscuits too. So step out and shrill and a space will be made for you. "When Steve Jobs founded Apple, he had no money and no customers; what he did next is the hallmark of a great entrepreneur. First he convinced a local computer store to order his non-existent Apple computers, with payment on delivery. He then convinced a parts supplier to sell him the components he needed to build them - using the order he just obtained as proof he would be able to pay them back. Jobs and a small team worked in their garage to build the first computers, delivered them on time and made a tidy profit. Apple was born from nothing."
So you want to be a lawyer, a medical doctor, a writer, a journalist, a distributor, an auto mechanic, an actor, a preacher, etc, but you are easily dissuaded by many people already in that profession. I encourage you to jump in with your eyes closed. Be blind to them all. Notice no one and announce your presence with a bang. Sound simple? This is part of the shrill concept.
You must endeavor to be present and different. Marketing professionals call it differentiation. People only notice those who are different. Creatively stand out. Give what was not there. Or tweak what was there to take on new identity. Bring ingenuity to play. Every product or service on planet earth has several new ways of producing it, so rejoice. Find yours and do it. Copy, reinvent, extend, recreate or invent but just do a new thing. Let your products be appealing in look and feel. For services, you are the tangibility of your product so you must appear professional before all prospects and customers. Let your competence, integrity, transparency and accountability sell your business. All your communication materials like call cards, sign, logo, writing materials must stand out professionally. Create a corporate image. Have a philosophy-mission, vision and corporate values and live it. This assumes that you would have legalized your business through incorporation, or even a business name. Do this. This ranks you in the league of big companies in the world even if by perception.
Market your product to the extent of your resources. We usually assume we must get on billboards, TV, radio or other print media to be known. Not at all. Simply ensure the presence of your product or the representers in all the fora where your target customers are and you would have marketed. In extreme cases, you may need to offer your products or services free of charge for testing and feedbacks. You need lots of feedbacks while starting. We usually advise entrepreneurs to hone their selling and presentation skills. This is very key as you must articulately present your products or services passionately and sometimes on short notice at critical fora where sales and non sales are possible depending on you. If you can't, engage an articulate presenter. This is our new found world due to globalization. Everything is about presentations and defense. Sell value, solutions and benefits. Radio, TV adverts etc, presence could come in later once affordable.
Network: I won't dwell much on this as I have mentioned it. Let everyone you come across know what you do. Do not assume. Inform. Share your call cards. Be present or ensure product presence if possible any where there is a possibility of sale or prospect. Join associations or network groups. Exploit cheap but effective means of mass communication. If possible engage in sales calls and prospecting. Insist that any group you belong are all aware of your handiwork.
Basic book keeping, revenues computation and banking transactions:
You may not be a professional but your efforts would all be in vain if you cannot keep accounts and records of your transactions. Know basic bank transactions of credit and debit and charges. Understand invoicing, proposals, stock taking, the difference between gross profit and net profit, and general book keeping. Even if you must employ someone with that skill, you can only supervise effectively if you have background basic knowledge. Big businesses have been sank by poor records keeping. Same will happen, only faster to a business start up.
Continue to seek information and knowledge concerning your venture. Update yourself. Read wide or watch programs on it. Be present at trade fairs or forum where it is being discussed. Network with competition. Share information that will not be detrimental to your business. Obtain information from your buyers and suppliers of your inputs as well. Decide to be the best.
Ensure periodic trainings and refresher courses. Obtain fresh vista. Hear from external consultants who have the privilege of working with several other companies in your field and enrich yourself. Update your knowledge and be current.
I'm sure there are so many other mitigating actions not covered here but you can never go wrong with these.
Let me end with the words of Oliver Emberton. "I think entrepreneurship is a form of enlightened gambling. Skill and tenacity are big factors, but luck plays a big part. However, as long as you can keep picking yourself up when you get knocked down, try different things and keep learning, the odds are in your favour. You just have to dare to chance them."