One of the most frequent questions aspiring entrepreneurs ask me is “Where should I spend my limited amount of start-up money?” My answer is that it depends on the type of business you are starting.
A brick and mortar retail shop does need more start-up cash than an online information product business. There is inventory, rent, security deposits and possibly some fix-up/build-out work to be done. There are ways around spending on these items with barter, consignment, trade and other savings options which I have implemented myself and have written about on this blog. I have started successful businesses on very little cash and that is my number one suggestion for anyone starting a new venture.
There is only one thing I would borrow money for at start-up, but first, I’ll tell you what
I recommend you do NOT spend money on:
- High priced legal and accounting services. Yes, there will be a time when these are vital to your business but a l lot of new entrepreneurs waste time and money on establishing an LLC or Corporation and setting up expensive accounting systems long before they need to. Unless your business involves liability, just get started. Get whatever licenses you need, start as a sole proprietor and start making money. Of course if you are selling physical items in a state with sales tax, you will need to obtain a re-sale license right away. Keep your business money completely separate from your personal money. Then, when you are generating revenue, contact an attorney and set up a legal business entity to protect your assets and a good accountant to help you avoid unnecessary tax.
*note:I do highly recommend you purchase insurance if you have a brick and mortar location where you could be liable for injury to a customer. If you have inventory you will need to insure it for fire and theft as well. If your stock is on consignment. check with the artist or supplier to see if their insurance covers it while in your possession.
- Fancy office equipment, fixtures or build-out. You don’t need state-of the art technology unless you are starting a tech-based business. I’ve started every business with a pen and legal pad, off-the-shelf receipts and a cigar box for cash. Wouldn’t you rather hit your break even point and start building up a reserve than have a snazzy cash register? If you are doing your business online, you do need a working computer you can depend on but you do not need a lot of pricey software, nor do you need the fastest, best technology. Try to work with what you have until your business is generating enough to pay for it.
- An expensive website. Too many new entrepreneurs wait until they have the perfect website to start their business. That’s a huge waste. What you think you want in the beginning is almost never what ends up serving you and your clients best once your business is up and running. Do pay for a self-hosted domain and use a free WordPress theme to begin. I am absolutely not a techie and even I can set up a WordPress site in a day. Later, when you are generating enough income to pay for it, hire a WordPress expert to help you fine-tune the site to suit your needs. Have them teach you how to do it so that you can keep it updated yourself. Ideally, barter for their services. ( I learned this the hard way. I paid a Silicon Valley way too much money and wasted weeks waiting for them to create my dream site. I wasn’t in business long before I realized it did not fit my needs and replaced it with a WordPress blog which I can make changes to myself as my needs change.
The one thing I would spend money on, even if I had to borrow it, is education or consulting. I’m not talking about an elite platinum group coaching club where you pay $20,000 to $100,000 to spend 4 days a year with a coach in a group of people. (Yes those do exist and people vie for a spot in them.) Rather I am suggesting that if you know what you want to do but not exactly how to go about it, you hire someone who has done it successfully to guide you through the obstacles. It will pay you many times over to get it right the first time.
If you can’t afford one-on-one consulting which can be quite expensive, find a small group mastermind led by someone who is experienced in helping people work-through solutions. It doesn’t have to cost a bundle and it will be the single best investment you make in your start-up. If you are ready to take the first step toward making your dream business happen in 2012, go HERE to learn how you can get your ideas in front of 2 life-long entrepreneurs and problem solvers.
Most of us have diverse aspects of our daily lives which can lead to distraction and fragmented thinking. Whether it’s the need to juggle family, business and household or working on several related projects simultaneously, multi-tasking often breeds mediocrity.
Because I have a couple of different businesses, I am frequently bouncing between websites and blog posts and twitter accounts. Part of the challenge is the constant generation of ideas whirling in my brain faster than I can get them all down. So, I switch over to another page or file and record the thought. I get things accomplished but I know I could do better if I focused on one task at a time.
Every year I pick a word and for 2012, my word is FOCUS. I’ve not decided exactly how I will apply this to my work day but I have a few ideas. I may choose to work strictly on one business on certain days. If I am doing a project for Inspired Livelihood and something comes up for Craft Biz Blog, I’ll possibly just pretend that Craft Biz Coach is out of the office today and she will get back with you tomorrow. I’ll keep my Inspired Livelihood hat on all day. And then how do I handle areas of overlap in my businesses? Maybe I’ll divide my day spending morning on one biz and afternoon on the other.
As an artist, you may work on crafts that require diverse processes. Do you design Monday, fabricate Tuesday, solder Wednesday, market Thursday and pack and ship Friday? Do you throw pots in the morning, glaze others in the afternoon while others are firing? What happens when you get a burst of creative energy on a day that’s designated a marketing day? How do you organize your tasks so that you maintain sharp focus while continuing to be open to flow of inspiration?
My friend Barbara Winter has some great tips on 3 Ways to Sharpen your Focus HERE
Is this you?
It’s the last two weeks of the year and your anxiety level is rising, your to-do list is still long and you are putting everyone else’s needs and wishes before your own. You go through this every December and every January you’re exhausted and get a bad cold or flu, right?
Well, you’ve got a lot of company but it’s not a happy group and you won’t see my face in that crowd. Not anymore.
A few years ago, I started questioning why everyone gets colds in January. I have a couple of theories and neither has anything to do with the weather. Where DID that myth come from anyway? Everyone knows by second grade that germs make you sick. You don’t catch a cold by going out in the cold.
So what causes you to get sick in January and blow all your new years resolutions to eat better, exercise more and work smarter?
Here’s my theory-two big mistakes:
Finger food. Yes, you read that right. We go to holiday parties and office parties where everyone is putting their hands in the same bowls of nuts or candy. You know that woman you see in the public restroom perfecting her makeup and hair but forgetting to wash her hands? Well, she had her fingers in that same platter of treats. Enough said?
That’s an easy one to avoid. I eat before I go to the party unless it’s a sit down dinner. I never, ever sample finger food. Period. Sound extreme? I haven’t had a cold since 1991.
Stress: The second reason for the January flus and blues is a tougher one to overcome because it involves major mind-shifts. It means putting fewer expectations on yourself and excepting that the holidays aren’t gong to be perfect. No one’s going to love you any less for it and you’re going to love yourself a lot more.
Some years ago I realized I was absolutely no good to my family or anyone else if I was exhausted and grumpy. I stopped seeing it as my responsibility to make everyone’s holiday happy. I started sending New Years cards instead of Hanukkah and Christmas cards and one year, they didn’t go out until nearly Valentines Day. I don’t think I lost any friends.
I’m going to suggest that right now, today, with only days until both Hanukkah and Christmas, you just STOP. Sit down and look at your list. Give yourself permission to alter those you haven’t done yet. What can you give the people on your list that doesn’t require you to run around to those crowded stores?
Here are a few ideas:
Gift cards to Amazon or Itunes. Amazon ships physical gift cards in a pretty box with bow and free next day delivery.
Give a donation to a cause that you know the person feels strongly about. You can do this online as well and the person receives a card showing that donation was made in her name.
Give a coupon to do a “mitzvah”. In the jewish tradition, this is a good deed. Give a certificate for baby (or parent) sitting, closet cleaning, a cooked meal or whatever you are good at that the person would appreciate your help with.
Another BIG stress factor in January is money. You charge gifts in December and are faced with a big credit card bill in January. And if you’re still in a job, you may resent having to go to work to pay off those bills, right?
This last suggestion may seem counterintuitive to you but it will forever change that pattern of stressful December followed by exhaustion in January?
I’m suggesting you buy YOURSELF a gift. Yes, even if it means putting more money on your credit card because it’s the most important gift you will give.
What if you could give yourself a gift this year that meant:
- No more dreaded office parties-and no more contaminated finger food.
- No more last minute rushing around because your time is your own.
- No more stress over how to pay off those bills in January because when you need more cash, you can give yourself a raise.
No, I haven’t had too much eggnog. There really is a gift you can give yourself that will ensure 2012 will be the first year you face the holidays on your own terms.
Make 2012 the year your dreams of an ideal livelihood become reality. CLICK HERE to find out how.
A Facebook post this morning by Tama Kieves reminds us to surround ourselves with people who support us. Do you have people in your life who believe in you? Are you spending time with nay-sayers who make you feel that your aspirations are frivolous and unlikely to succeed?
It’s tough around the holidays to avoid dream-bashers if they are family members. Sometimes they are well-meaning and think it’s their duty to keep you “practical” and realistic. Remember that particularly when it comes to self-employment, most people who haven’t done it just don’t understand and believe a steady job means staying “safe”. People who’ve been in jobs their whole lives often see starting a business as risky but you know it doesn’t have to be and there’s no real security in a job anyway. “Others,” to quote Tama, “demand you climb into small boxes so that they feel safe around you.” Regardless of their motives, don’t let people who haven’t been on that journey discourage you from following your own path.
If you know 2012 is the year you want to finally move forward and make your dreams happen, the best way to do that is to connect with a supportive group of people who are moving in the same direction. People who see obstacles as speed bumps not roadblocks. My friend Barbara Winter and I have created just that environment for you. We’ll be meeting with a select group of entrepreneurs in an intimate setting where we can focus on your dreams and work as a group to find solutions to whatever is in the way of your living your ideal livelihood. As a group, we’ll look at your idea or business and design a concrete plan of steps for you to take to MAKE IT HAPPEN IN 2012. CLICK HERE to find out more.
We’ve all heard the stories. The guy who just happened to be seated next to someone on a train who loved their his so much he offered to finance it. The woman who happened to be at the same cocktail party as the only publisher in her genre. Yes, sometimes things happen that seem like “lucky breaks” but the reality is, these people met the right people because they were out there telling their story. You could be at a holiday party and meet the perfect person to help you break into your dream business but if you don’t have your message clear and share it, nothing will happen. You might be seated on a plane next to the best friend of your ideal client but if you have your earplugs in and your face buried in a book (as I sometimes do on long flights), that person will never know of your expertise.
Maybe you believe in coincidence but the only way you are going to make things happen is if you are clear on what you need to make happen and what steps to take to make it real.
Do you have a dream that you long to bring to fruition but no idea where to begin to make it happen? If you’re serious about starting your dream business, don’t sit around waiting for you lucky break. Outline a plan of small steps you can start taking now to move in the direction of your dream.
Speaking of luck, if you need help figuring out what those steps are or how to make money with your idea and how to do it without enough money to start up, join Barbara Winter and me in Lucky Las Vegas for a Mastermind Weekend where we’ll examine YOUR idea and brainstorm solutions to help you jump those hurdles and make 2012 the year you finally make your dream happen. Find out more HERE
It doesn’t have to. More businesses than you know are started with no initial investment. In fact, many well-known successful business were started in someone’s basement or garage. Think “Geek Squad”, started by Robert Stephens at his kitchen table and later sold to Best Buy for millions.
If anyone suggests you borrow money from family or friends, ignore them. If someone loans you start-up money, they are likely to be worried about recouping it and could get more involved in your new venture than you want them to. You are starting a business because you want to be in control of your own life and having to answer to your lender could end up feeling like you still have a boss.
Especially with the internet and social media, even businesses that are not web-based can be started with no money. One of the biggest expenses for a new business used to be advertising and now so much can be done for free.
If you think about it, it’s not really money you need. It’s what money can buy and believe it or not, you can actually get a lot of those things for free. Well, not for free but in trade or partnership. If your business is service oriented, you may be able to Read more
Growing up, I was restless. Teacher’s often described me as too curious, a dreamer and easily distracted. While I did well in school, I often got in trouble for questioning and challenging. In class, once I understood a concept, I couldn’t just sit in that space while the teacher went over it again with the kids who didn’t “get it.” I’d create new entertainment for myself. At one point, I was labeled a “quitter” because I didn’t stick with an activity once I learned enough to satisfy my curiosity in a subject. I moved onto something else that captured my interest. These days, I’d probably be tested for an attention deficit but I believe I am what Barbara Sher, in her book, “Refuse to Choose” calls a “scanner”. These can be positive personality traits for an entrepreneur.
A counselor in 9th grade actually said, “I’m concerned that you may not be able to settle into a job for any period of time.” I didn’t understand why she thought that was a problem. I had the great fortune to grow up in a family that encouraged us to follow our passions and pursue our interests so I don’t think anyone expected me to settle into a career and stay there. What I didn’t realize was that many people who experience this restlessness perceive it as a flaw. I hear from people who say they have outgrown their careers but fear the risks of moving onto an unknown, so choose to stay in the security of what they know.
Yesterday, while reading an article on Serial Entrepreneurship in American Express Open Forum, I came across the phrase “You have more fear of regret than of failure”. That is the way I’ve always felt and summarizes what drives me as an entrepreneur.
In her Dec. Changing Course newsletter, author Valerie Young compares outgrowing a career or business to falling out of love with a good and faithful partner. It’s time to move on. She warns, Read more
Incase you missed this last year:
resolution |ˌrezəˈloō sh ən|
1 a decision to do or not to do something
I’ve never made a New Years resolution. I think it’s because when I decide something needs changing or fixing, I just do it now. Deciding to change a specific behavior on a particular date just never made sense for me. Maybe it’s just a personality thing but I wonder how much of our making and keeping resolutions depends on how we define the word.
intention, decision, intent, aim
These words feel a bit wishy-washy to me. Almost like you’re saying “I’ll try” as opposed to “I will.”
What if we define resolution as
plan, commit, pledge, promise?
That makes it sound like more of a sure thing, doesn’t it? Something more binding, right?
Have you been thinking that 2012 is the year you are finally going to start or grow your business? That after the New Year you are going to get serious about making it happen?
If New Years resolutions haven’t worked for you before, forget resolutions. How about SOLUTIONS? Check out what Barbara Winter and I have planned so you can make sure that 2013 is the year you absolutely MAKE IT HAPPEN, HERE.
This is the second in a series about what might be holding you back from starting your own business.
When is the best time to start a business?
Do you keep thinking you want to start a business but the time isn’t right, the economy isn’t right or you don’t have enough free time right now?
The best answer I’ve ever heard to the question, “When is the best time to start a business?” came from Gordon Moore co-founder of Intel. He said “The best time to start a business is when you have a good idea.”
If the current economic situation is holding you back, remember that some extremely successful enterprises were started in a weak economy. There are actually advantages to starting when the economy is sluggish. You have a greater pool of resources because there is less competition. Vendors are more willing to negotiate and work with you. If you need to hire employees or even virtual assistants, they are hungrier for work right now so you get good rates and choice of the best. Also you have time to start off slowly and learn as you go, get the kinks out and be running at full swing when the economy strengthens. You will be well positioned to take advantage of the recovery.
I often hear “I want to start a business but I’m waiting until my kids start school” or start college, or finish college. What they don’t realize is that there is never a perfect time. When the kids are in school, there will be more time commitments with after school sports and activities. If you wait until your kids start college, you may be taking care of elderly parents. The best answer I know is to start now so that when your kids are in school or college or you have elderly parents to care for, you will have some years in business already and have the funds to help your kids and parents and the success to hire help or outsource some of your business tasks.
Not enough free-time? That used to be my excuse for not getting things done too. Then I met Read more