As the economy slowly improves and employee satisfaction declines, starting a business looks better and better. According to CareerBuilder, “More than one in five employees (21 percent) are pledging to leave their current employers in 2016, a 5 percent increase since last year (16 percent).” If that one in five is you and you’ve been seriously considering taking the plunge and starting a business, it’s vital that you think it through and know what you’re getting into before you find yourself overwhelmed and in debt. If you want to know how to start your own business, you need to ask yourself these 10 questions first.
1. Is my idea realistic? Can it truly be a viable business?
This will force you to really hone in on exactly what you want your business to be. It’s easy to say you want to start a marketing firm but you need to nail down what kind of marketing, who your clients will be and what your ideal location is. Then do some research on demographics, what the competition is like, how much they make in a year, etc.
2. What are my key skills?
Be brutally honest with yourself — make a list of the skills you have and what you would really enjoy doing. No one can do everything, so if you’re incredibly creative but terrible with numbers, take that into account.
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3. Am I prepared for potential financial hardship for a few years?
Nailing down your finances is key to starting a business. Luckily JOBS Act has made it a little easier to raise money. Marcus Estes, CEO of Chroma Fund reports, “One trend that every small business owner should be aware of in 2016 is the late arrival of the final piece of the JOBS Act: Title III. This means that it’s likely that every business will have the chance to raise investment through crowdfunding, even from middle class, non-accredited investors.”
4. Do I need a partner or partners to be successful?
You may think it’s best to go it alone but statistics show that,”…successful startups are 59% more likely to have more than one founder.” However stressful and risky you think starting a business will be, multiply that by 100. Having a solid partner to share the load makes everything a little easier.
5. Am I willing to put in A LOT of time in the beginning?
By a lot we mean pretty much all of your time for the first several months.
6. Am I ready for the stress of taking a risk on myself?
As we said above, no matter how stressful you think it will be, multiply that by 100. You need to be mentally prepared and have a support system to lean on when things get really tough.
7. How will I react to setbacks?
There will be plenty of setbacks. If you thrive on challenges and problem-solving, being your own boss is right up your alley. But if you’re easily frustrated, this may not be for you.
8. Am I ready to be responsible for other people?
Although you’re thinking about how to start a business for yourself, in most cases you’ll need to hire employees. Give serious thought to whether you’re up to the task of managing others. Also consider how you will handle the responsibility of having their livelihood in your hands.
9. Am I self-motivated and disciplined enough to get where I need to go?
It takes an insane amount of drive and self-discipline to launch a successful business; be realistic about whether that’s something you’re ready to take on.
10. What is my exit strategy?
Of course you aren’t planning to fail, but almost 90% of small businesses do in the first year. The good news is that once you’ve run a business that failed, your next venture is more likely to succeed. You won’t even be able to consider starting over if you don’t have a plan for getting out without losing your shirt.