Many people think of entrepreneurship as living the dream. There’s a lot of literature and social media hype encouraging people to quit their jobs and start businesses. Friends and family tout it as the path to financial freedom with being your own boss, dictating your hours, and being stress-free as the main benefits. However, those who run businesses will tell you that this will not happen from day 1. As you ponder starting a new business, let’s talk about some reason reasons that could lead to failure.
- For freedom and to work fewer hours
It is a lie! If anyone ever told you running a business involves less work, they are either lying or are not successful. Blunt but true. Starting and running a business requires your investment in both time and money. Whether you start it as a side hustle or a primary source of income, if you want it to be successful, you have to face the fact that you will need to sleep, eat, and breathe the business. Participating in all the business operations is even more essential when setting up. You get to know what it takes to create the product, understand your sales cycle, get feedback from your customers, understand the finances and streamline the operations. It doesn’t sound like much sleep or vacation time will be available, right? As the life-giver to the company, accept that only your work sustains the business; when the work stops, the money stops coming. In time, you can hire people to take charge, but you still have to put in the hours.
- To set up a spouse, family member or friend
This one is not obvious. In fact, you probably recoiled and made a face as you read it. I’m not saying it won’t work but more than likely it ends in either financial disaster, a ruined relationship or both. We’ve all wanted to, done it or seen it done by someone you know. A person investing into a business for the sake of helping a family member or a romantic partner get on their feet. Often, it is a proposal made on a whim with very little planning. It ends up being more of busy-ness than a business. For the most part you will find that there is no real sense of loss for the other party because they treat it as a pocket money machine or a way to keep busy and rarely thrive because they prefer the status quo. More importantly you will find that instead of using funds for actual profitable investments and savings, you keep throwing good money after bad because the emotional connection with your “business partner” provides a revolving bailout. So, what happens in a couple of months or years? You realize you have saved nothing and made nothing, if anything, you’re probably in debt and are met with entitled demands for more. It causes resentments and stress to the relationship and double tragedy in the end. Not to say that all such businesses are doomed to fail – just appreciate that the purpose of a business is to make a profit or meet a need.
- Get rich quick
I thought about a succinct way to discuss this and realized I just need one word for many things that caused financial heartache and ridicule for many Kenyans. Quails. If you don’t know or aren’t keen to Google it, Quail farming was a fad that burned fast and bright and crashed just as dramatically. Hailed as the bird that cured all ailments, the eggs and meat had vast healing powers that led to an increase in the prices and stocked pockets for the pioneers. Slowly but surely, there was an influx of new farmers and investors and with that the market was flooded, prices dropped, people cried, and memes were created. The end. For Johnny K who invested KES 1M most of which was financed, it is a devastating blow which he literally continues to pay for depending on the terms of the financing. The bottom line is that instant gratification is a myth when starting a business. For every get rich quick probably 1 of 10000 will succeed - meaning you will most likely be the rule and not the exception. Simple probability says if you know that 1 person, then it’s not going to be you. If getting rich was that easy, we wouldn’t call them the 1%. Research, plan, innovate, work hard and be consistent. You may not get rich, but you will achieve some form of success.
- I have a brilliant idea
It is not enough to have an idea but to bring it to life. For all that an idea can be brilliant, its success as a business venture is dependent on execution and filling a real-world need. It is a sure recipe for disaster to start a business without knowing who will buy your product. Just because you want it doesn’t mean other people will buy it. If you find yourself saying, “if we build it, people will buy it”, stop and conduct market research before you hurt yourself.
The second part of it is execution. In a world where there’s always competition, you differentiate yourself and increase your chances for success by executing cheaper, faster and more efficiently than everyone else. Your brilliant idea will not turn into a successful business venture if it costs more than people want to spend, is of poor quality or doesn’t meet the need.
Lastly, please remember that getting it right takes time and several iterations. Manage your expectations about when you’ll make that first million and realize it’s going to take a lot of sweat, persistence, and patience to get there.
- To be on trend
It seems like every other day some random influencer or tv presenter is setting up a spa or a luxury salon, getting an air bnb there or having a lucrative brand ambassador career. You see the opening of the business, the famous clientele, the popping of champagne and the high life and assume that with your skills, education, contacts and work experience, you can keep up with the Jones. It’s a horrible reason to set up or ran a business and will likely lead to disaster. You don’t know all the work they’ve put in or who/what is financing these businesses. Point is, you are not them, they are not you. A need for clout or keeping up is a sure way to break your heart and your bank.
Starting a business isn’t something to be taken lightly. It is a significant life decision and one that you need to be able to see through for the foreseeable future. As you consider opening your business, remember that it takes blood, money, tears and sweat before you can take those vacations, sleep without dreaming about the business, stop working all those unpaid overtime hours and get enough money to stop worrying about paying your bills.