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“The Entrepreneur Equation” author Carol Roth on what to ask yourself to help decide whether you should start a new business.
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-- edition of the Willis report.
Look if you are considering starting your own small business my next guest says there are three important questions you need to ask yourself.
Carol -- small business expert and author of the bestselling book the entrepreneur nor equation.
Our Carol Muster with this idea because a lot of people say I'm not starting a business now because the economy's so bad.
But look at this Burger King FedEx Microsoft all started in a recession now is not a bad times -- of those things here I don't think -- You can ever time the market in any time there is this strength.
There's also -- weakness and vice Versa so in a bad economy they're also really good things that you can get out of your business you can get better.
Deals with vendors you may be able to get better payment terms so.
I never try entire time the market -- always say if you have a really good customer opportunity in -- the best person to serve that opportunity.
That's when you -- -- RE tells what are the three questions are so the first question you wanna ask yourself is is this something that I should.
Because a lot of people.
Go forward in the -- something where the risk isn't worth the reward I know.
-- and many small business owners who worked too many hours for the same or less pay with more stress.
Then when they had.
Their own job.
So it takes a lot of the valuation and Smart numbers -- It doesn't you have to go through the business planning process that -- too many people start a business because they're passionate they have a great idea.
And they don't really look at the hard facts that you want to say is this enough of an opportunity.
For it to be worth it -- -- what about the risky have to evaluate risk as well.
You have to -- -- with the rest because this is something we're going to be putting in your time and your money and effort.
And I always say there's a rule of three in business everything takes three times as long costs three times as much and it's three times as difficult as you anticipates.
What I always hear from small -- breaking -- -- always telling me if I had to do it over again I might not but I'm glad I dead right let's talk a little bit about it can I test drive my -- -- This is the most important thing that you should -- is test it out before you invest your time in your money and your effort and -- simple ways that you can do that's the first thing before you quit your job tested out on nights and weekends.
See if it's something that you enjoy doing because a lot of time when the passion goes away after a week or month is that why -- why did I get myself into it.
But also.
Before you invest in a lot of overhead see if there's a way to do it on a smaller scale -- your food entrepreneur.
And you wanna open a restaurant try -- food truck first with a lower investment if -- retailer.
Of opening up a big space that has huge.
Overhead try a pop up shop if -- massage therapist before you open up the spot to an alcohol kind of business.
I love this because you're telling -- short cuts here.
Ways to test strike that idea.
What I don't have a lot of capital to put -- were -- -- seriously a lot of people.
And I've met them they don't have a lot of money but they want their own business.
Most people don't have a lot of capital going -- to your own business.
But it's one of those things that you have to make sure you give yourself enough runway so if you don't have the capital yourself.
You're gonna have to go out and unfortunately venture capitalists only fund a fraction of a percent of all business -- have to get creative.
Creative way to do that is with crowd funding and their platforms like kick starter dot com.
Where you can go out to your network and say -- I've got a really -- business idea or project or products.
Will you sponsor me now I know the job -- is using this to raise capital but you can do it in a different way to kick starter we've come up with incentives.
So let's say you're coming up -- the product is safe for fifty dollars.
I'll send you the product when it's done but for a hundred dollars a put your name on the box and -- thousand dollars up hoping pick what color the boxes.
In the lot of people just call mom and that.
-- they put they put it on their credit card.
And hope that they're gonna make the money they wanted to read my mom dad don't have the money to give you any more and that's part of the problem -- -- -- the bank.
And even do a lot of your other friends and family members but if they do.
Be very very careful about it because you're Leary a professional relationship on top of a personalized you actually say don't.
-- them for somebody for more money than they can afford to lists exactly you have to assume that they're gonna lose the entire investment that they cannot afford to lose it did not ask them for that money Carol I think that's great advice and I know everybody's listening -- out -- -- great stuff thanks for helping us out tonight they really -- -- it.
