What You Want to Know About Starting Your Own Business

If you are reading this article, then you are probably one of those people who think they want to start and run their own company. If you belong to this group of individuals, the chance is that you already have a great idea for a new business. Generally speaking, people like you who aspire to be an entrepreneur one day often dream of achieving fame and fortune. There’s actually nothing wrong with that. As a practical matter, you are not alone if you’ve been bitten by the entrepreneurial bug. What is certain is that more people than ever – some of them may even be your classmates or friends – are choosing the path of entrepreneurship.

The big question for you, of course, is how do you become a business owner? From a realistic perspective, every aspiring entrepreneur like you will need to learn as much as possible about their dream business  by completing academic programs such as a degree in business, finance or marketing. It is also important to work part-time or full time for companies in the line of business you want to establish eventually. In a bigger picture, as an aspiring entrepreneur, it is best to obtain valuable insights about the pleasures and pitfalls of entrepreneurship. It is equally necessary to learn how successful entrepreneurs handle the challenges of starting their businesses, as well as how to launch and grow a new business. You can do these in three ways. First, you can read newspapers and magazine articles and biographies of successful entrepreneurs. Notable among these magazines are the Entrepreneur, Forbes, Fast Company, Inc., Hispanic, Success and the Black Enterprise.  Second, you can join entrepreneurship associations, such as the Association of African-American Women Business Owners and the Entrepreneurs’ Organization. Third, you may want to take advantage of the information provided in the websites shown on table 1.

Table 1 – Organizations Representing the Interests of U.S. Businesses

Organization	Function
U.S. Chamber of Commerce Website: http://www.uschamber.com	The world’s largest business organization representing the interests of more than 3 million businesses of all sizes, sectors and regions
Entrepreneur.com Website: http://www.entrepreneur.com	Provides the latest news, expert advice and growth   strategies for small business owners.
Kauffman Foundation Website: http://www.kauffman.org	Fund and mentor innovative local startups with the potential to grow.
The Small Business Administration Website: http://www.sba.gov	Provides financial assistance programs for small businesses, including debt financing, surety bonds, and equity financing.
The Wall Street Journal Small Business Website: http://online.wsj.com/small-business	Provide guidance for small business owners to understand, manage and market online.

Source: Kurtz, 2013

Playing to Win: How Entrepreneurship Really Works

Being an entrepreneur means seeking a profitable opportunity and taking the necessary risks to set up and operate a business. It also means having the boldness to strike out on your own and to be a pioneer in your own right. Perhaps you are not satisfied with the status quo in your family, your community or your country and hence want to achieve certain goals on your own terms. The only sensible questions you need to ask here becomes whether you are a risk-taker. Do you really have what it takes to own a business?

First, as an entrepreneur living in U.S., or in any other country, you are different from many small business owners. In as much as many small business owners in your locality may possess the same drive, creative energy and desire to succeed, what will make you different as an entrepreneur is that one of your major goals should be to expand and grow your business(This is unlike the many small business owners in your locality who usually prefer to keep their businesses small) . Sam Walton(1918-1992), the founder of Wal-Mart, was not satisfied with just one successful Ben Franklin franchise, so he purchases others across cities in U.S. As an aspiring entrepreneur, you should have the ability to combine your ideas and drive with money, employees,  and other resources to create a business that fills the needs of the markets in your locality or nation. This entrepreneurial role, when done at the right place and at the right time, can make something significant out of a small beginning. It is hence not surprising that Wal-Mart was able to report net sales in excess of $443 billion in 2012(Walmart, 2012)

Second, as  an aspiring entrepreneur, you must have a vision – an overall idea for how to make your business idea a resounding success. Having a vision is always a good start because you can then pursue that vision with relentless passion. Generally speaking, every business idea or invention , from the light bulb to the cell phone, originated from a person with a vision – someone from your community or from another part of the globe who sees the world in a slightly different way and wants to work on it. Think of Bill Gates  and Paul Allen, the two smart individuals who started Microsoft Inc. They launched Microsoft with a vision of putting a computer in every home and on every  office desk, with all of them running on Microsoft software. Guided by this simple vision   Bill Gates  and Paul Allen  created a company that became the world’s largest marketer of computer software. In addition this vision guided Microsoft Corporation and provided clear direction for its workers as the company grew, adapted and prospered in an industry that is characterized by constant technological change(Kurtz, 2013). Note that this does not mean that a business idea or an invention comes only through a vision. Not necessarily. As a matter of fact, business ideas or inventions can sometimes be a by-product of a necessity, an accident or even a mistake.  A good example is the medication called “penicillin” and that popular wine known as champagne, both of which were created by accident(History Learning Site, 2013; Champagne Magic, 2001).  And so also was the microwave, whose heating potential was discovered by their inventor while working on another unrelated project.

Third, you must maintain a high energy level – a very important quality to become a successful entrepreneur. Broadly speaking, you must be willing to work long and hard to realize your vision. If you are already working full time somewhere else, you must also be willing to do the full time at this regular day job and spend weeknights and weekends launching your business. Note that successful entrepreneurs like Ted Turner (the founder of the CNN) and Steve Jobs(one of the founders of Apple Computer) spends at least 70 hours a week on their new business, which of course affected the quality of their lives – at least at the beginning. The bottom line: You need a high energy level in order to make your business successful.

Other qualities that you must have in order to succeed as a business owner are self-evident: You must be confident and optimistic, believing in your ability to succeed so you can motivate your workers; you must tolerate failures, viewing setbacks and failures as learning experience so your success will be guaranteed by your sheer will and ability to try and try again when others would give up; you must be creative,  constantly conceiving new ideas for goods and services so you can devise innovative ways for overcoming difficult problems and situations; and you must fortify your internal locus of control so you don’t have to blame others or outside events for your success or failure but, instead, own it all, believing that you have the making of your destiny in your own hands.

                If you are convinced that you have all the above qualities, your next step is an important one: getting the seed capital to launch your company or business.

Finding Financing

Depending on the size and nature of your proposed company, your start-up capital can range from as low as $2000 or as high as several millions – say, for the purchase of a McDonald’s franchise in a lucrative area.  For each of these scenarios, you can get the money you need from five main sources:

Debt Financing: Loans from family, friends, business associates or banks and on lines of credit offered by banks.

Self- Financing: Whereby you rely on your personal savings or monthly income as your source of fund.

Equity Financing: Whereby  you rely  on the money or funds supplied by other people or firms who will become the co-owners of your business. In that case, you will not be required to repay equity funds.

Venture Capital: In this case your funding will come from business organizations or group of private investors  who are ready to put their money in your business if they believe it is a high-potential growth company. Note that venture capitalists, particularly those of them that lives in United States and Europe, may expect high rates of returns  along with a stake in your business in exchange for taking a risk with their funds that will be invested in your company.

Angel Investors: Angel investors – those wealthy individuals in your community or country who are willing to invest money directly in new ventures  - can also be a source of funds for your new business. You can have access to these types of investors by visiting the “Active Capital” section of the Small Business Administration’s website.  For instance, those angel investors that focus on women can be reached at http://www.fundisabella.com or at http://springboardenterprises.org

The View Beyond the Wall

Starting your own business can be an extremely interesting, rewarding, and satisfying feat. However, before leaving your regular job and taking this leap of fate, remember that a business can deliver as many famines as feasts to you because it involves  risks. Like every other human activity, the trick is mastering how to ride the roller coaster.

Notes

History Learning Site(2013): Alexander Fleming and Penicillin. Retrieved February 11, 2014 from http://www.historylearningsite.co.uk/alexander_fleming_and_penicillin.htm

Champagne Magic(2001): Champagne History. Retrieved February 11, 2014 from http://www.champagnemagic.com/history.htm

Kurtz D.L.(2013): Contemporary Business. Hoboken, NJ: John Wiley & Sons Inc.

Wal-Mart(2012): Walmart – 2012 Annual Report. Retrieved February 7, 2014 from http://c46b2bcc0db5865f5a76-91c2ff8eba65983a1c33d367b8503d02.r78.cf2.rackcdn.com/93/a7/ff21a9764702bb5bc8271faacfeb/2012-annual-report-for-walmart-stores-inc_130221023846998881.pdf