We’re rapidly approaching the end of the year, a time when we begin to think about what we’re going to do in the coming year. If you’re like me, your thoughts are probably turning to things like starting or expanding a small business, finding a way to earn money without having to go to work for someone else. But it’s one thing to think and fantasize about leaving your job and striking out on your own, it’s a whole different barrel of monkeys to actually do it.
There are some people who are cut out to be entrepreneurs, and others who aren’t. Much as we would like to believe that all we need is a good idea, some start up funds, and maybe a few employees to help us get things off the ground, there is more to it than that. Some of us just don’t have what it takes in order to be successful as a business person.
How can you determine if you have the right traits to be a small business owner? Why, the same way we determine all personality characteristics nowadays: an online test! *canned sitcom laughter* Seriously, though, there are places to look to see what traits most entrepreneurs share. I like the one from Georgia State, myself, although our old friend, the Small Business Administration, has a checklist of their own.
Of course, since you’re already here, I may as well share the completely unofficial, based only my own experiences (including those with this very blog), Amateur Financier list of Entrepreneurial traits. *canned audience cheering* If you are seeking to start your own small business, you should ask yourself the following questions before you get started:
Are you willing to work hard?
Probably the biggest determinate of the success of your enterprise (at least, of the ones in your control) is how much sweat and elbow grease you’re willing to put into your business or other venture. I’ve yet to hear of a business that requires little time and effort while still providing substantial monetary benefits (not counting various infomercial claims, of course). Starting a small business is like investing, putting in time in order to generate a profit in the future. Working on your business will require significant time, as much as a full-time job in many cases, if not more. If you are unable to put this level of effort into your enterprise, you’d likely be best served with a less time consuming investment, in something like mutual funds.
Are you a self-starter?
This is an important trait, one that goes hand in hand with out last trait. When you have your own business, there’s not going to be anyone looking over your shoulder, telling you what to do, setting deadlines, and providing regular feedback. You’ll need to be your own taskmaster, cheerleader, and manager, or your enterprise will simply fall apart if you don’t force yourself to keep your nose to the grindstone. (Well, if you have a spouse, they might help you to stay on task, but that all depends on whether they support your enterprise.) If you aren’t up for this level of work, you’ll be much better off finding a job you like, preferably at a stable company, gradually building up your savings and investments. (In spite of what Robert Kiyosaki would have you believe, gradually saving and investing while working a regular job is a perfectly reasonable and successful method of becoming rich.)
Are you willing (and able) to fail?
Let’s be honest, many businesses end up failing. Stores don’t get customers, manufacturers don’t get orders, even blogs sometimes find themselves not getting much traffic in spite of the bloggers’ best efforts. As an entrepreneur, you need to be able to accept these failures, learn from them, and move on with your next venture, and keep doing this until you find success. As for the ‘able’ part of this question, you need to be prepared for what will happen if your enterprise fails. Do you have adequate cash reserves to fall back on? Do you have a back up plan if your business isn’t a success (or isn’t a success as quickly as you’d hope)? Is your family going to be provided for should things take a turn for the worse? Ensuring that you know what do if things go wrong is important to guaranteeing you can try your hand at your own business without wounding your rump.
Are you confident in your enterprise?
Sorry if that last point brought you down, but hopefully your reaction was, ‘I’m prepared for the worst, but my business WILL achieve success’. Being confident in what you are doing may not automatically lead to success, but giving up on your business before its time is a surefire way to guarantee failure. The confidence you experience will help determine how much work you put into the business, how inspired any workers are, how much help you will offer to customers, and will generally improve your business’s chances.
Are you creative?
Creativity is one of those nebulous characteristics, which many people attempt to define with only moderate success. For our purposes, one of the major advantages of creativity is being able to deal with the many issues that will arise in the course of owning a business. Problems and difficulties will arise while running a business, and not all of them will have obvious, textbooks solutions. Being able to use your creativity in order to come to solutions for your problems is an important trait, one which is all but necessary if you start a small business and need to figure out how to solve problems. Learn, grow, and advance your skills, and you’ll end up coming out ahead. (See? Spend long enough discussing entrepreneurship, and even a pessimist ends up looking at the bright side of life.)
There you have it; meet these five requirements, and in my opinion, you’ve got a pretty good foundation (that is, yourself and your tendencies) to start building up your business. Good luck, and enjoy the life of a small businessperson.
(PS. To verify my identity to Technorati, I need to put this code up on the site to verify my identity: QAWWAA6GXBVG Soon, I’ll be Technorati bound!)