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Weigh the cost before you start

January 28, 2009 / by Michael K. Redman

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This blog entry is not encouraging and it is not uplifting so beware.  If on the other hand you want to go forward with your eyes wide open then read on.  Kathryn and I believe that having your own business is a great thing but it is also one of the hardest things we have ever done.  We believe with all our heart that if you are not compelled to pursue a dream to have your own business or to create something significant in the world then work for someone else.  You will save you and your loved ones a lot of heartache and a lot of money.  This is part of the shpeal that we give people thinking they are going to start a business and it starts with the advice, "Weigh the cost."

Everyday thousands of people have, what Michael Gerber has called, an Entrepreneurial Seizure.  They think that it is their God given American right and maybe their duty to start a business.  They figure that if they can make something or perform a service that they can and should go out and work for themselves.  So that's exactly what they do.  They quit their job and walk away from all since of security and start a company but what they didn't do was count the cost. 

While 100% of them actually believe they will make it 90% of them will not still be in business in five years.  Out of the remaining 10% it is said that 90% of them will not make it to ten years.  That leaves 1% of the original 100%.  So if only one out of a hundred actually make it for the long haul then why would you take the risk?  It will cost more money, more time and more determination than you think.  You will work long hours, be exhausted most of the time and wonder when you will you ever make a profit.  If you think that this will be over soon well think again. 

Most companies don't really make a profit the first couple of years and the ones that fail over 90% in the first five years; well they never made a consistent profit.  That's why they failed.  And when those 90% of people’s dreams came to an end what did they have to show for three, four or five years of blood sweat and tears?  The answer is nothing except a bunch of memories and what some would call a character building experience.  So if you can run away from this entrepreneurial seizure then run.  If the seizure is so strong that you can't run then just relax and don't make any decisions until it is over and then get up and run. 

But, if you can't stop thinking about it and long after the first seizure hits you still are driven to do start your own business then do yourself a HUGE favor, learn what it takes and weigh the cost.  We help companies succeed everyday and we can help you.  The people who succeeded are not lucky but they learned what the rules of business were and worked hard to apply them.  The one thing you have that many of us didn't is a guide through the narrow path.  Read it and pay attention and you could be one of us business owners that love our work and can pay the mortgage.

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