Category: Startups

Beating the Odds

by Victoria Reynolds

Starting a small business is always risky, and the chance of success is slim. According to the U.S. Small Business Administration, roughly 50% of small businesses fail within the first five years. History has shown there are common threads amongst all of these failures.

Started for the Wrong Reasons

Some small business owners believe as an entrepreneur they will make more money, spend more time with your family, and will not have to “answer” to anyone else. Most successful business owners will tell you that as a start up business, nothing could be further from the truth.

Reality Check:

  • There could be financial difficulties until the business becomes profitable, which could take months or years. You may have to adjust to a lower standard of living or put family assets at risk in the short-term.
  • Business ownership can be exciting, but it’s also a lot of work. Can you face six or seven 12-­hour workdays every week? On average, business owners invest 60 hours per work week into their business and often times, this is uncompensated. Is your family prepared?
  • Business owners need to develop working relationships with a variety of people including customers, vendors, staff, bankers, and professionals such as lawyers, accountants, or consultants. Can you deal with a demanding client, an unreliable vendor, or a cranky receptionist if your business interests demand it? Successful business owners answer to everyone!

Lack of Planning & Insufficient Capital

These two evil twins will, hand in hand, ultimately cause the failure of your business. Many small businesses fail because their planning wasn’t based on accurate, current information and educated projections. Business owners typically underestimate the amount of money needed to get a business going and overestimate revenues they will attain. There are resources available to assist with your business planning.

Poor Management

Small business owners often lack the relevant expertise in ALL areas of the business. It is important to first assess your own weaknesses and then build a team of support to compensate for the voids in your skill set. Are you great at sales but hate numbers? Are you an experienced manager with little experience in the industry that you business is in? As an entrepreneur, one key to success is recognizing your own “weaknesses” and being humble enough to get help!

Over-expansion

Business owners often don’t establish a solid customer base and steady cash flow before they take on addition overhead costs to meet the increase production needs. And so many make the mistake of believing a bigger or second operation will turn their breakeven or losing venture into a winner. Guess again & refer to the Evil Twins listed above!

Location, Location, Location

A good location can make a struggling business ultimately survive but a bad location spells trouble to even the best run businesses. Things to consider: Where are your customers? Competitors? Location History?

Failure to Change with the Times

The only constant in business is change. Businesses and their owners must have the ability to recognize opportunities and be flexible enough to adapt to changing times.

Ultimately the success or failure of any business will be based on a combination of planning, capacity, and opportunity. Writing and following a good business plan, surrounding yourself with expertise, and seizing each and every opportunity that you find will surely help you to beat the odds for success.

*SBA’s participation in this blog does not constitute an endorsement of the William E. Simon Graduate School of Business Administration or any other person or entity. SBA’s programs and services are provided to the public on a non-discriminatory basis.

May 30, 2010 | 0 comments View Post

5 Things You Need for Startup Success

by Judy Seil

So, you want to start your own business. What do you need to get started?

1. Cash
Cash is king.  All investors and partners want to know that you are willing to take a chance with your cash before they take a chance on you.
2. Business Plan
A well thought out business plan.  Say you want to open a restaurant, for instance, but you have never run one before. You may not understand the tight profit margins or what it takes to obtain the necessary permits to open a restaurant.  Your business plan must be well thought out and address all issues including permits, demographics, and most importantly the bottom line.
3. Supporters
You need to have a good accountant and attorney who will look out for you and your business.  Check around and research which firms specialize in the type of business you are starting.  See whether they return calls and are available when you need them.
4. Banker
Get the right banker.  Make sure it someone who understands the type of business you are starting.  If it is agricultural, get someone who understands that industry.  If they have never financed a ag business, they may not be the right person for you.
5. Key Employees
Yes, it may be nice to be in business with a family member, but remember you will need to see them at family events in the future. If the business doesn’t succeed, how will that affect your life?  Sometimes it is best to separate business and family.

Above all, you must have knowledge. If you don’t know enough about the business, you probably shouldn’t start it.

“In modern business it is not the crook who is to be feared most, it is the honest man who doesn’t know what he is doing.” Willam Woodsworth

May 20, 2010 | 1 comment View Post

Entrepreneurs: A Breed Apart

by Alyssa Gruber

Entrepreneurship is a unique field of business. It is practiced by many and mastered by few. It can be learned by anyone, but only certain people have the ability to be successful at it.

Entrepreneurs are unlike other people in business. Entrepreneurs are people in business who actually provide employment and opportunities to other business people. Their views on cash flow and income differ from fundamental theories in finance adhered to by finance executives. To entrepreneurs, risk is everything, and rather than working for money, money works for them. Entrepreneurs are emotionally attached to their companies, often referring to their businesses as their “babies”, while most people in business see their companies as financial tools or merely as  paychecks.

No matter how disparate their reasons and motives for starting a business or their business ideas are, all entrepreneurs have entrepreneurial spirit, or motivation used to better themselves and/or others on their quest to achieve success.

Usually, entrepreneurs have both business sense and creativity. While there is no absolute list of qualities that describe the entrepreneurial spirit, common characteristics that entrepreneurs believe to be important in their own triumphs are:

  • Ambition. Entrepreneurs often set lofty, yet attainable, goals and have the impetus and commitment to accomplish them.
  • Focus. Entrepreneurs have a vision of what they want and are able to focus on the big picture.
  • Perseverance. Most entrepreneurs do not have a “get rich quick” mentality, and they generally plan to reach their business goals in 10 or more years of starting their companies. They push for their goals with tenacity and perseverance despite any obstacles that may arise.
  • Self-determination. The capability to control their own successes or failures drives entrepreneurs to work hard and do whatever it takes to achieve their ultimate dream.
May 02, 2010 | 0 comments View Post

My Experience at YEA!

by Claire Siegrist

Oh, Finally! On March 24, 14 YEA! businesses presented to a 13-investor panel with our business PowerPoints. Each of the investors was a representative of a company in the Rochester area. One of the investors was a past Young Entrepreneurs Academy student whose business had been very successful. Her success is really amazing and proves that our businesses can actually be profitable and thriving.

A few weeks before the panel, we went on a fieldtrip to a Scott Miller in Pittsford, NY, a local salon, to learn about personal appearance and proper dress. We all looked spectacular in our formal business attire. Before the actual presentations, there was a one-hour “meet and greet” in the foyer. Everyone was nervously practicing his/her handshakes and elevator speeches with his/her fellow YEA! students beforehand. It was great opportunity to impress the investors and their position in the business world.

That night was so exciting! After the six minutes maximum presentations, the panel asked three questions per business. I felt very confident answering the questions and I think my impressive responses pleased the investors. I was asked about the research I had done by Mr. Bruce Zicari from the Bonadio Group. I was asked two more questions by Ms. Allana Lazeroff a Genesee Regional Bank and John Schoenberger of Wegmans.

Even though the whole talking-in-public thing really isn’t my area of expertise, I felt like a natural. Every business had to request a certain amount of money to cover their start-up costs. Some people received much more than their requested amount while others were completely underfunded. I received $950, the third highest amount in the class!  I also got a TV deal: Channel 10 is going to feature me (and classmate Priyanka—Intense India) a local business television show. I stepped off that stage overflowing with pride and contentment of my great achievement.

Check back next time for more class updates!

Apr 21, 2010 | 3 comments View Post

Moving Forward into Spring

by Yvonne DiVita

I just received my invite to contribute to the NEW Simon School’s Women Entrepreneurs Blog - and I’m thrilled! First of all, I love the look and feel of the new blog. Isn’t it outstanding?

Here we are headed right into spring, and the Simon Graduate School of Business has created an updated look and feel to this blog.

It’s exactly what we all should be thinking about, today. Spring is a season full of promise. We are emerging from the doldrums of winter (although some of us – skiers, I’m thinking, are still praying for snow!), out of the shadows into the sunlight. Everything is green – even our thinking! It’s invigorating, don’t you think?

Entrepreneurs and established business-folk should be greeting spring with a new outlook on their business, a renewed sense of accomplishment (you made it through the long winter, didn’t you?) and with a commitment to new business, new clients, a new focus. At no other time in our country’s history have we – the women of the U.S. - been as poised for success, as we are now.

ready for spring

Ready for spring

Yes, we are slowly climbing out of the recession – that’s not just my opinion, it’s fact; and as we step out into the sunlight, it’s clear that opportunity is knocking. It’s knocking for women everywhere – can you hear the buzz? Feel the excitement? Taste the expectation? I can!

What do you have planned? Are you redesigning your blog/website? It’s a great idea. New, fresh, colorful, purposeful – that will grab people’s attention.

Are you rearranging your office? Again, invigorating and inspiring. Moving your desk, office plants, furniture, even just rearranging your books, can be uplifting. Add new curtains, get a new side chair or plaque for the wall. Build daily inspiration into your workspace.

Have you cleaned out your closets and packed up old books? Have you taken spring cleaning to its ultimate outcome and decluttered to the point that you can now focus on work and clients, and not the clutter all around you?

Recently, I moved from NY to CO, and in the process, I did my spring cleaning very early. I decluttered to the nth degree (be brutal, if you haven’t used it or worn it in a whole year, donate it to charity), I shopped at thrift stores to add functionality to my office and my home (I work from home), and I kept my focus on building a stronger, more successful business in 2010.

I can tell you that I’m on track to accomplish my goals. It’s easier to be focused when you’re in a comfortable, sunny, happy place. Bring the outside in – creating light that keeps the shadows away. Take a walk every day. Think about your life, your work, and your workspace as one. Be all that you can be – spring is a welcoming time for new ideas, new goals, new surroundings.

Share your changes with us, in our comments section. We want to know what you’re up to!

Mar 19, 2010 | 1 comment View Post
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