Do you want to be an entrepreneur? Do you want to start your own business? Have you thought about it? What kind of idea do you have for a business? Here are some things to think about prior to stepping out on your own, to decide if maybe it is a good idea.
5 questions to ask if you are considering entrepreneurship
- What is your tolerance for risk? Are you able to go without pay for a while? Are you able to afford the loss of your investment?
- What kind of market analysis have you done? Do you know what the market looks like for your product or service?
- How many other businesses like it are currently in the market? Are there dozens of competitors, or would you be the first one to market? It is worth considering how many other competitors you would face. Also consider whether there is a single very large competitor in the market.
- What regulatory hurdles do you face? Can you even get into the market? Is it easy or is it hard? Sometimes licensing regulations can prevent entry into a market altogether. Sometimes other restrictions on market entry can make it prohibitively expensive.
- Can you live with this idea day and night for the next while? How comfortable are you with this idea? Can you live, eat, and breathe it for the next few years while you focus on getting the business off the ground? The first year of my own businesses has been a whirlwind, with very little sleep. I do get asked very regularly whenever I actually sleep.
A sixth question, which matters more than the five
Every question above is about the idea. None of them is about you.
That is the gap most people fall into, because the idea is the interesting part and it is the part everyone will happily discuss with you. But businesses rarely fail because the idea was wrong. They fail because the person running it couldn’t do the bit they didn’t anticipate — selling, when they thought they were making. Managing people, when they thought they were doing the work. Deciding alone, when they had always had somewhere to escalate.
So: what part of running this will you be bad at, and what will you do about it?
Everyone can answer the first half. Very few have an answer to the second, and the answer is rarely “get better at it” — more often it is hire it, partner on it, or accept that the business has to be shaped around the gap. That’s a more useful conversation than another round of market analysis.
Note too that a majority of women-owned businesses have a single owner, which means that gap doesn’t get covered by a co-founder. Worth planning for before you start rather than discovering in year two.
What about you? What questions do you think are most important to ask if someone is considering entrepreneurship and a new business? How can you tell if it’s a good idea or not?
