Looking back on the first year of work at the Business Innovation Zone (BIZ), I have met with over 60 potential clients ranging across a wide variety of business areas. I have learned much on this path. First and foremost, I have learned to never prejudge an idea. I must say that some of the most "unique" sounding ideas described in an initial phone call or meeting have turned out to have the most merit. The entrepreneurs in this area have a tremendous amount of creativity and several have identified truly unique market niches that have not been exploited to date. Along with those great ideas, I have met with many whose ideas I found lacking. Asking hard questions has become a well worn path for me. In many cases the idea has not been thought through from a business perspective. The euphoria of the "perfect product" has overshadowed the realities of a profitable venture. I often find myself asking potential clients questions about the running of their prospective business. For many, it is a rude awakening as they come to understand the immense hardship and stress that will come with starting a venture.
I am often asked what advice I have for would-be or current entrepreneurs. Here are my thoughts for those starting out:
- Seek out many opinions on your idea. Do not just "go with your gut".
- Spend time up front on a business plan, but only to the point that you frame your path and plan. Business plans evolve rapidly when you are forming a business, rarely surviving the first customer engagement.
- Know your exit points. It is easy to look out and say "I will sell my business for $xxx,xxx,xxx". It is much harder to say, "I am only going to invest $xxx,xxx" or a certain amount of time. Treat your venture as an investment and know when to exit as the event arrives.
- Take a balanced approach to your idea and business. Do not ignore important areas for lack of knowledge or assume that "I will figure it out when I get there".
- Relationships matter. No matter how automated or high tech things get, the relationships you build will support your company and conversely the lack of relationships will guarantee its failure.
- Learn to sell. Selling is ABSOLUTELY CRITICAL to your initial success. Hiring a salesperson is not the answer in the initial phases of a startup. You the entrepreneur must be prepared to get out and sell your idea, your product, your service, and yourself.
- Finally, spend a substantial amount of time understanding the cash flow of your business. For most businesses, the lack of cash flow management is the single greatest failure point.
From Rush: BIZ is a community sponsored non-profit business accelerator designed to provide economic growth in Central Iowa through the development and expansion of entrepreneurial enterprise. Particularly if you have a business in Central Iowa that is poised to grow regionally, nationally or globally, I encourage you to contact Mike.
photo on flickr by aloshbennett