Sustaining Business Newsletter

Starting a Business in 2011
By Jennifer S. Hendrickson

Publication Date: January , 2011

Starting a Business in 2011
Elon Musk, entrepreneur extraordinaire and founder of PayPal, SpaceX, and Tesla Motors, gave an interview to Time Magazine for their 10 Questions feature and had this to say about starting a business:  “When you’re trying to create a company, what you’re really trying to do is organize a group of people to do something useful.”

Being an entrepreneur isn’t for the faint of heart.  It may take several years before your new business turns a profit.  It takes thoughtful planning, consistent execution, and a willingness to accept feedback from those around you.  You’ll work more than a standard 40-hour work week for a long time because nobody is there to cover for you while you’re away.  You’ll need the support of your family and friends – sometimes their encouragement will help keep you motivated.  And remember that you’re not avoiding problems at work – you’re simply trading one set of stressors (the boss, perhaps) for another set (cash flow).

It’s not just young people starting businesses either.  Many people are leaving corporate America and want to write the final chapters of their own professional story.  Some volunteer, some buy into an existing business, and a growing number are choosing to fulfill a lifelong dream by starting a business from scratch.  Sound like something you’re interested in?  Here are some general steps you need to take when starting a business:

• Take an inventory of your talents and abilities and then match those with a perceived need.
• Develop a comprehensive business plan.  Among other things this will include a competitive analysis, feasibility study, and financial projections.  Aside from helping you think through all the issues related to your new venture, your banker will appreciate knowing your detailed plans.
• Determine the source and amount of start-up capital needed for success.  You will probably need more than you anticipate for unforeseen expenses or a lag in revenue. 
• Once you have the business plan and the funding, you need a solid marketing plan that includes a business name, logo, public relations strategy, advertising, website, etc.  Unless the business you are starting is a graphic design and marketing firm, you need professional help with this step – this is your business image and it requires careful planning and execution.  Homemade materials ALWAYS look homemade.
• Set up your organizational structure, accounting system, insurance, etc.  Be sure you have a good attorney, accountant, banker and business advisor helping you along the way.

Sound overwhelming?  It can be.  It can also be one of the most rewarding moves you’ll ever make.  Whether your business provides a service or makes a product, there may be no greater satisfaction than providing something that someone else wants or needs – and earning a living from it.  The success of your business ultimately lies with you, your determination and drive, and your ability to organize a group of people to do something productive.

There are many tools out there to educate and prepare you for this life-changing decision.  Read books and magazines, take business classes, talk to peers and network with others.  If you think 2011 might be the year that you start a new business, contact us to get started.