Dear Startup Doctor,
I am currently working in a firm where the pay is not bad; yet not good enough to sustain me and my responsibilities in the long run. I am contemplating resigning to start my business. Do you think starting my business is right?
In an ideal world, starting your business is best. The independence to control your time and make money from your idea is always an appealing notion. However, I do not know exactly where you are in terms of skills, financial capacity and capability, structure and even state of mind to advise you to start a business and cannot say for sure which would be right for you at this time without further x-raying to understand your current situation fully. However, I will do my utmost best to guide you in making the right choice.
The first line of thought I would like us to explore is this:
Getting Another Job Can Solve Your Money Problem
I understand your allure to entrepreneurship, but it doesn’t always mean that working for someone is not also rewarding or would ensure your financial future. What often makes the difference is your resourcefulness and the value you are contributing to your organization.
Since your primary consideration here is about earning enough money to shoulder your responsibilities, starting your own business may not be necessary. You might consider carrying out a personal skill audit to know if you are qualified for a promotion or have the firepower to negotiate higher pay with your employer.
Make no mistakes about this: I understand the power of having your own business, and I have been advocating for entrepreneurship for over a decade; however, I am also aware that it is not everybody that’s cut out for entrepreneurship.
Some people are better off working under someone while others take on the risks associated with building your own business. Moreover, some people left their startup because of the appeal of paid employment and fared worse than when they worked for themselves and vice versa. Their experiences do not mean you shouldn’t leave; it just simply means that:
Starting Your Business is Not Enough!
You see, just like everything serious you want to do in life, you need a certain level of preparation if success is your goal. You cannot just be careless or spontaneous when thinking of starting a business, and hope to do well. You have to be armed with the vital information required to support the viability of your idea, possess the skillset, doggedness, hunger to succeed. Be always ready to innovate and refine your ideas, develop a thick skin, have patience and a certain degree of maturity needed to assess issues to make the right judgement call critically.
The ability to pay for office space, hire staff, get a website and logo for your company is not enough. Having a money-bag father or considerable savings is not all there is to succeed in business. The passion and commitment to succeed is equally not enough. As crucial as those are, they are not enough.
The challenge with many people who want to start a business is that they jump off with their brilliant ideas without sitting down to count the cost of starting a business. By cost, I am not just talking about money alone. There are many other sacrifices we make as business owners that money alone pales as a yardstick to gauge the cost of all we have had to expend to build a thriving business. The result is that most people who fall into the first category in this paragraph start but are unable to build and sustain their business. This lack of preparation leads them into more profound financial crisis than they had in paid employment.
I am sure you don’t want that to happen to you. So, to determine if you should start your own business or not, you need to be sure if you have:
What it Takes to Build a Profitable Business
To be able to build a truly profitable business, you must have a viable business idea, starving market and the capacity to deliver the solution they need consistently. That’s the basics of what it takes to run a profitable business.
Let’s unbundle these assertions.
Unless you want to start a me-too type of business, you might want to consider an idea that is capable of solving a problem or meeting a need for many people. You should be providing what existing businesses in your industry are not or even if you provide the same solution, you should do this in a much better and efficient way to stand out. It can be as little as improving the process of service delivery; product add-on or as big as revolutionizing the way businesses operate in that particular industry.
So, for any idea, you have now or a business you want to start when you eventually decide to either sue for promotion or resign from your current job, I want you to ask yourself: What can I do differently from the existing businesses that might enable me to thrive and make more sales? Can this solution solve a recurrent need? What is the lifespan or cycle of this solution?
If your answer is ‘No’, you don’t have a business idea yet. If yes, consider what that thing is. Is it good enough for someone to leave existing brands and patronize you? Is it something that can make your target customers willing to come to do business with you? If you were in their shoes, will you spend money to buy what you are offering? I am not a pessimist trying to dissuade you from starting a business. I am the Startup Doctor who is trying to help you launch out with strength and vitality.
To start and build a sustainable business, you must offer something that existing businesses don’t offer. You must be doing something different. That different thing (which is called a Unique Selling Proposition) must be attractive enough for people to choose you among more prominent and existing companies offering similar services or products.
It is not enough to have an idea. Your idea must solve a problem for a starving target market. No matter how good the innovation you want to package is, be sure that there is an audience for that solution. If, as an example, you decided to start selling digital voice recorder to broadcasters, as a business idea, are you sure they need it?
You may think they do; however, on the other hand, they think downloading a good app on their mobile phone might be much expedient. Selling digital voice recorders may be a good idea; but if the majority of your target audience are satisfied with using their mobile phone app to record interviews and vox pop for their radio production, dear budding entrepreneur, you don’t have a starving market.
Similarly, figuring out how to package Pap and Akara such that it retains its freshness till afternoon, could be quite an innovative move. However, beyond the excitement, do you have consumers that want to eat Pap and Akara in the afternoon? In most places, people eat this local delicacy either in the morning or late evening; but not afternoon. The way you can innovate is to find a way to make the delivery easy for people to buy and take to work the same way they can buy Moi-Moi or Okpa on the go.
Do you get my point now? Right! So, that’s how to determine if you have a market for your business idea and how you can apply innovative solutions to give your brand an edge.
Having an idea and a starving audience is still not enough. You must equally have the capacity to deliver the solution you want to give to your target market. The undoing of many businesses is that they could not consistently deliver on their brand promise. Capacity does not only refer to financial capability but equally points to human and machine.
You might require some capital to be able to get started with delivering the solution or creating the innovative product idea you have. Sometimes, it’s not money you need. You might need training, appropriate branding and product packaging. It could also be creating the right awareness, and the sales and distribution structure to deliver the service you want to offer.
In other instances, you might need to hire more than two employees to work with you to give birth to your business idea. Aside from being able to hire the best hands, you still need to pay them and provide leadership, if you don’t have the capacity in these areas, then you might not yet be ready for business. Being able to bring together and a lead a great team requires that you possess the required knowledge and expertise necessary to be able to provide the needed leadership and guidance. If you don’t have it yet, you may need to spend some more time on your job to learn or even if necessary, take a lower-paying job that gives you a chance to acquire requisite skills and exposure. However, if it’s money to survive that is driving your need to start a business, you may need to reconsider embarking on an entrepreneurial journey.
Many people have received millions of Naira as a grant. However, in retrospect, a year or two down the road, their businesses have folded up. So, what went wrong? After all, their business idea was brilliant enough to get the funding required to start their organization. One critical factor that affects growth is the capacity to manage and multiply the funds. Most successful businesses learned success principles in a hard way. They have painstakingly built their businesses one brick at a time from nothing to become the multinationals we see today because they were patient to lay a solid foundation at the start of their business. The secret to building a sustainable business lies in the strength of the foundation of the business to carry it to scale. Ask yourself, how patient are you to set up the structure of your business from the beginning to carry the growth projections you have made?
Just in case you are still wondering what my direct answer is, I have none. However, if you read and apply the answers to some of the queries I have raised above, you might be able to arrive at the best answer that suits your situation.
As you meditate on these words, let me guide your thoughts by posing these questions below to you.
- If you leave your job now, do you have a business idea that can solve a problem for a starving market?
- Do you have what it takes to deliver the solution?
- Do you have enough money to sustain yourself and family while building your business and waiting to turn a profit?
If your answer is yes, you are on track. If you answered no to two or three of the questions, my advice would be to stay in your job or get a higher paying one until you are ready.
All the best in your pursuits!
The Startup Doctor