In 2011, I started my business as a hobby while I worked full-time at an online brokerage and investment service. At the time my mission was to figure out what I could do to make money outside of my corporate career.
I wasn’t the entrepreneur who took the leap of faith with nothing to fall back on. I enjoyed my lifestyle too much.
Why Startups ‘Crash and Burn’
My first client was an NYC-based sales team. I helped them to develop systems to grow their team more efficiently. I soon found out that I could actually start a business consulting other small businesses on systems and procedure implementation.
While I worked with this client I stumbled upon a business coach that was making six figures doing what I wanted to do (or at least what I thought I wanted to do). I hired this coach and for the next two years she helped me develop a plan to get my business to the multi six figure mark too. She was highly skilled at coaching, but I wasn’t a traditional coach. My business was different.
You hire someone because you want to learn from them and avoid the mistakes that they’ve made. So you do everything they say. In my case, I was building a business that didn’t support what I truly wanted. My business grew faster than I even realized. Soon, I found myself in the middle of something that wasn’t at all what I initially set out to do.
I had a full team of 7 people.
I had a full roster of clients.
I had income.
I had high expenses.
But nothing I did was set on repeat.
According to Bloomberg reports, “8 out of 10 entrepreneurs who start businesses fail within the first 18 months. A whopping 80% crash and burn (Forbes).” I’m pretty sure, for some, one major reason is because they reach the point I found myself at; they built a business that defined them instead of defining the business they wanted to run.
Know your numbers.
If you want to build a business, knowing your numbers is key. Even if you’re “scared” of numbers or have a love-hate relationship with money.
I wasn’t carefully looking at my revenue versus expenses. The irony of this is that I worked with clients on this exact issue, but I wasn’t doing it myself. And I sure as heck wasn’t using the money tracker my coach gave me.
A revenue tracker is a tool that allows you to forecast your income and look at your expenses so there are no surprises. Not carefully tracking my revenue was one of the many mistakes I made being a new entrepreneur.
Today, I have a better handle on what goes in and what comes out of my business. This allows me to manage cash flow and make decisions based on what’s actually going on, not just a hunch or a blind leap of faith.
Create systems so you can sleep.
I am a systems geek so this comes easy for me. But this was also my downfall in 2014 when love broke my business. I fell in love and my business fell apart.
I learned it was time to stop wondering what my team was doing or having to look over their shoulders every day. Empower your team so they know what they have to do and you can trust that it’s done correctly.
There’s nothing worse than running a business that simply becomes a way for you to pay your team, meaning you’re not actually making any profit.
If you’re a solopreneur right now, you may think you don’t need systems. Nothing could be further from the truth. Plan ahead. Creating documented systems will allow you to get hire the right person for the job when it’s time to scale.
Hire smart so you’re not alone.
When you’re ready to make new hires, you’ll want to hire people that can grow with you. There’s nothing worse than repeating the hiring cycle every few months. You’ll never get traction and grow your business. Worst case, they’ll stifle your plans.
For example, a client hired a web developer who said he was well versed in email marketing services and could create an opt-in page (the basics of online marketing). He estimated the job would take 3 to 4 hours. To her surprise, it took him 3 to 4 business days.
Hiring smart means you have a clear job description and clear expectations. Start with small test projects, check references, and conduct a behavioral interview. Put their skills to the test so you know they can deliver on what they say they can deliver.
Listen to your clients and customers.
I thought I knew everything that my clients needed. So, in year two of my business I launched 5 programs and thought “they’ll rush to buy!”
I was wrong. So wrong.
Take the time to get to know your market. Survey your clients, ask for feedback, and connect. If you don’t have Google Analytics yet, today is the day to set it up so you can learn more about the online habits of your customers.
When you take the time to listen you start to create things that people actually want. Listening will save you time, energy, and money.
Remember your why, daily.
I’m currently doing a brand story challenge with Jennifer Kem, President and CEO at KemComm Media Group. The exercise forces me to take a deeper look at why I work with certain clients and reflect on various turning points in my business.
This is so important because it’s easy to forget why you’re in business. You start to work so hard that you’re on the verge of burning out. At this point, “your why” is long forgotten. Being aware of “why” you’re in business will keep you connected to what you love to do and make it rewarding.
For many, the goal of having your own business in the first place is to do what you enjoy and in a way that lets you live your life. So, take the time and care to design your business step-by-step and don’t let it design you. The last thing you want is to wake up two years from now and wonder who’s business you’re running.
This article has been edited and condensed.
Sonaya Williams, creator of The Business Automator, is a speaker and consultant on the topics of having the right tools and team to end day the today chaos in your business. She teaches business owners how to automate, systematize, and grow their business with new revenue to support their lifestyle. Connect with @sonayawilliams on Twitter.