Welcome to entrepreneurship… the ups, the downs, and the days when those ups and downs come so quickly that you feel like you’re on a roller coaster just minutes after scarfing down every fried food the amusement park had to offer.
If you’re lucky, you come from a family of business owners. You learned to walk holding on to shelves in the family store or grew up doing your homework on a bar stool at their restaurant. The concept of bookkeeping and customer satisfaction was ingrained in you right along with looking both ways before you cross the street.
Or maybe, you didn’t grow up in that kind of family. Maybe you were raised by parents who worked for “The Man” their entire lives. Parents whose dream for your future was to get a cushy government job and retire with a healthy pension. Maybe, you actually heard one of your parents mutter the sentence, “I’ll have to work until I’m dead. In fact, I’ll probably just die at my desk.”
Human nature is interesting and either one of those upbringings could have had you running to or running from entrepreneurship. If you hadn’t already guessed, I grew up in that second scenario. The thought of striking out on my own and starting my own business never even crossed my mind.
Until October of 2016.
I had just been laid off from an amazing job and I had this devastating feeling of “Someone else has control over my life.” It was a terrible feeling and as soon as I stopped crying, I decided to do something about it.
My entrepreneurial journey began. I’m about 3-years in and in no way suggesting that I know everything there is to know about running my own business (or even what I don’t know I don’t know), but I’ve made many mistakes along the way and if you are just starting out as a business owner, you can avoid some of these potholes.
13 Mistakes Entrepreneurs Make
Starting a small business requires a delicate balance of preparation and “pushing the damn button” (I’ll explain that in a bit). I’ve separated the mistakes I’ve made into three categories: Basic Business Mistakes, Mindset Mistakes, and Money Mistakes. As you travel through your journey, keep an eye out for these traps and avoid them whenever possible.
Basic Business Mistakes Entrepreneurs Make
Welcome to a whole new world. So much to discover. So much to… screw up. Here’s what could go wrong.
1) Not understanding what’s involved in running a business.
It was probably my first February in business when I got an email from one of my clients. He asked for a list of what he’d paid me throughout the year. It took me about 4 hours to comb through my checking account to figure this out. I learned a very valuable lesson about bookkeeping that day… you should do it.
If you haven’t been raised around business owners, you probably don’t know what goes into starting, building, and running a business. Seek out a mentor or read business start-up books to educate yourself. Whatever you do, don’t go in blind and assume that everything will just work itself out.
2) Not understanding who you serve and what service you offer.
When you go out into the world and meet new people, you’ll be expected to explain what you do and who you do it for in a short, clear, 30-second commercial. When you can communicate this clearly, people grasp how you can help them, and if they don’t need your service, the information will be filed away in their brain so that when they meet someone who does need your service, you’re the first business that comes to mind.
When you can’t communicate this clearly, you blubber incoherently for a few minutes until the other person puts you out of your misery by faking a phone call. Needless to say, no client for you!
3) Not knowing how to communicate your story.
Depending on what industry you’re in, there may be 5, 15, 150, or 15k other people who do what you do. I’m not saying this to discourage you from opening and marketing your business. There is a need for you in the marketplace. I’m just saying this because you have to understand what makes you different from the competition, and you have to be able to share that with people. Often, your story, your Why, your reason for being (or at the very least for opening your business) is that difference.
If you’d like to get free storytelling tips delivered to your inbox each week, visit www.sherylgreenspeaks.com and click on the “Get Storytelling Tips to Improve your Business and your Life” button.
Mindset Mistakes Entrepreneurs Make
While the quote from Henry Ford has been beaten more than a piñata at an Anger Management support group, it really does hit the mark. “Whether you think you can or you think you can’t, you’re right.” Here are some of the issues you may run into.
4) Not moving forward because you’re stuck in the “Perfection Trap.”
A fellow speaker friend of mine was lamenting about how she had purchased the domain for her site, learned enough WordPress to create a basic website, fumbled her way through the website content, and now, she was going over it again and again looking for ways to improve it.
It should be mentioned that this website was not yet view-able by the public. It was just sitting there in interweb land not doing anyone any good and not letting the world know that she was open for business.
When she relayed this information to me, I had four words for her: “Push the damn button.” Okay, to be fair, I didn’t say damn. But I’m trying to keep this piece clean and professional. I texted those four words to her every day for a week. She finally pushed the damn button.
Your website, marketing collateral, products, services, etc. will never be perfect. However, if you don’t put them out into the world, they will never do you any good either. Don’t let fear of failure, judgment, success, or clowns, get in your way. Actually, if clowns are trying to stop you, I’d go ahead and throw in the towel if I were you.
5) Not valuing your abilities.
Writing has always come easy for me. So easy, that I just assumed it was easy for everyone else as well. When we have innate skills, we don’t think of them as special, we think of them as easy and common. One day, I had a friend ask me to proof a brochure she’d created for her new nonprofit.
Oh. My. Gosh.
It was bad. No, it was awful. I didn’t understand. She spoke fairly well. She was an intelligent woman about to change the world with her charity. Yet, she couldn’t write her way out of a paper bag with the bottom cut off.
You have a skill. I don’t know what it is because I don’t know you. But I’m confident in saying that you are better at something than most of the population. Maybe you can design logos that elicit “oohs” and “aahs,” or you can whip a closet into shape in 2 hours. Maybe you can make an old car engine purr like a satisfied kitty or cook a meal that leaves people leaning back in their chairs with their pants unbuttoned.
You can do something that other people can’t… so please don’t undervalue your skills.
6) Not scheduling time for breakdowns.
Starting a business is hard. It’s scary. If you’re single, and your dog refuses to go get a job, the responsibility of keeping a roof over your head and your dog outfitted with a steady stream of squeaky toys, falls on you. There are no guarantees. It is not for the faint of heart. Abandon all hope, ye who enter.
Okay, maybe I just went a bit too far. But seriously, entrepreneurship is terrifying and at some point in your journey, panic is going to set in.
For me, it’s around 3 pm each day. Overly dramatic? Maybe. Totally honest, yep. I have a quote posted up next to my desk from a speaker that visited our local NSA Chapter years ago (that’s the National Speakers Association… not the spies). I look at it every single day.
“The only way I will fail is if I freak out. And I will not freak out.” – Geeta Nadkarni
No matter how much faith you have in yourself, no matter how amazing your idea and your work ethic is, you’ll undoubtedly face some insecurity along your journey. Be prepared for it and if you can, schedule some downtime to have your panic party and then move on with your day.
7) Not tooting your own horn.
“I don’t like to talk about myself.”
If you’ve ever uttered those words, get over them REAL QUICK. If self promotion makes you break out in a cold sweat and rock in the corner of the room muttering “No more wire hangers,” you may want to rethink going into business for yourself.
People need to know what you do. They need to know that you can help them. And if you don’t tell them, who else do you think will? Hopefully, you’ll get to the point where your brand is a household name and you won’t have to advertise… of course, even the huge brands, the Pepsi’s, Marriott’s, and the Jeep’s of the world, they still advertise.
It’s okay to talk about how you can help people. It’s even okay to talk about how good you are at helping people. The more you help people, the more they will talk about you too.
However, as many people have said (but I suspect Stephen Covey said first), “The first sale is to yourself.” Believe that you can do it and then you can convince everyone else.
8) Not distancing yourself from the naysayers.
They probably mean well. Your family, your friends, they just want you to be safe. Yet, surrounding yourself with people who don’t support you, don’t think you will succeed, and don’t feel that you have the resilience to stand back up if you fail, is NOT a recipe for success.
If they aren’t supportive in other areas of your life, you may need to cut them loose. However, if they are still a part of your world and support you in other ways, perhaps you just need to stop discussing your entrepreneurial endeavors with them.
Whatever you do, just remember that when they say “You can’t” or “You won’t” or “You shouldn’t,” they are just projecting their own fear onto you. They are too scared to walk away from a regular paycheck and reach for something greater. You’ve got enough of your own fear, don’t let them pile any of their crud onto you.
9) Not charging appropriately for your services. Of course, there’s always a question of how much. I still struggle with this to this day. There are a bunch of really stupid answers out there like “Figure out how much you want to make and then divide it by how much you want to work.”
Let’s see, I want to make one million dollars (I’ve got my pinky to my lips as I say this in a Dr. Evil accent) and I only want to work 5 hours this year. While that would be lovely, I don’t think anyone is going to pay me that much money to write their website content for them or to speak to their audience (yet… I’ll get there).
It’s great to know how much you want to make and to value your skills and your time, but you’ll also want to take into consideration what the market will allow. The best way to do this? Ask. Talk to people that fall into your “ideal client” persona and ask them what they have paid for your service in the past and what they would be willing to pay. Then, remember that not everyone is your ideal client. If they would only pay $10 an hour for the service or product you provide, that may be a reflection on their budget rather than a reflection on your worth.
For more information read: Why a Healthy Mindset Is the Key to Successful Entrepreneurship
Money Mistakes Entrepreneurs Make
9) Not setting boundaries early on in any client relationship.
First, a text came at 6 am while I was half sleeping and half trying to motivate myself to get to the gym. The next text came on a Saturday while I was sipping a cocktail at the pool. There were 10 pm texts and holiday texts, and honestly, I’m not a doctor, a lawyer, a plumber, a mechanic, or a locksmith. I don’t provide a life or death service. In fact, I can’t even imagine what sort of “writing emergency” a person might have.
Yet I was using my personal cell phone for business and I never made it perfectly clear to my clients how they should communicate with me and when. I’m not suggesting that you should limit client communication to 12 minutes every other Tuesday, but you have to have a life and you have to establish boundaries in order to protect that life. (If you’re a realtor or mortgage broker, you’re probably laughing at this section. I get it. Sorry, but that is the nature of your business)
10) Not discussing cost up front.
I’d dare say that most of us would rather discuss religion, politics, and sex than broach the subject of money. There are so many self-worth questions rolled up into that discussion, and for a new entrepreneur (and even someone seasoned), it can be the hardest conversation in the world.
But, it is a conversation that MUST happen BEFORE you get started on the work. If you complete the job before discussing how much you’ll charge, your client will be angry, you’ll be resentful when you end up settling on much less, and the relationship will be ruined.
I was doing some writing work for a business coach. When I quoted him my blog rate, he quickly agreed and then told me I wasn’t charging enough (mind you, he did not offer to pay more). So the next time he hired me for a different type of project, I charged him more. The only problem? I neglected to tell him that I was charging more until I sent the invoice. He pushed back. I gave in. Our relationship was severed shortly after.
Talk about money. Not talking about it will make it even more uncomfortable.
11) Not taking a deposit.
The guy I was dating teased me for taking a few hours off from my business to meet a friend at the pool. I was the one laughing when I landed a website project from my day in the sun.
She was a friend so I assumed I didn’t need a contract or to take any money up front. I got to work the following day and within a week, she had content for a brand new website. I sent it over excited for the feedback… but that never came. She was busy. Too busy, apparently, to review the content. Also too busy to pay her invoice when a few months later, I finally got tired of waiting. There was a second invoice, a third, a plea to let me close out my books because the year was ending.
It wasn’t until I sent her a long email explaining that she was now the reason I was taking deposits before getting started, and that I considered her a friend and felt taken advantage of and disrespected, that she finally paid her bill.
Get at least 1/3, preferably 1/2 up front. Hopefully, you’ll see the rest of it, but if you don’t at least you got something for your time and energy.
12) Not being extremely clear in your contracts.
What exactly are you going to do?
I never understood the concept of “Scope Creep” until I went into business for myself. This is when you agree to do a certain amount of work for a client and they keep asking for tiny little upgrades (without extra cost) until it no longer resembles the project your originally agreed upon.
One of my services is ghostwriting. A ghostwriter writes your book. We don’t do fancy formatting with graphics and custom images. We don’t publish your book for you. We don’t market your book for you. Now, some of these things can be included for an extra cost, but they aren’t part of the basic ghostwriting service.
Unfortunately, my client did not understand this.
I’m not a fan of lawyer-speak, but your contracts must be crystal clear as to what you are including in the original price. If you have optional services, throw them on their with a price tag next to each of them. Explain that you can do those things, but they must pay for them.
For more tips on how to protect against scope creep, read Seven Techniques To Sharpen Your Scoping Approach.
13) Not supporting a cause because you aren’t turning a big enough profit yet.
We’ve been trained our whole lives to worship the bottom line. When we purchase or sell something in a Business to Business scenario, the question will eventually come up – “What’s my return on investment?”
But for some, money is not the be-all end- all. We want to make a difference. Our idea of “success” is not swan-diving into a pile of gold coins a-la Scrooge McDuck, but rather supporting a cause, standing for something we believe in, and leaving the world a better place than when we found it. That’s why the following advice, “Make your money and then you can donate to charity,” doesn’t sit well with people like us.
We want to do both. We want to do both simultaneously. In fact, we’re pretty sure that we can. And, we’re right. Look at Tito’s Vodka. In the early stages of the company, the owner decided to pour (no pun intended) his marketing budget into donating to animal rescues, building a following for his vodka while supporting life-saving efforts instead of just buying ads. Look at TOMs Shoes, whose founder decided to build a company around the concept of supplying shoes to the less fortunate.
Do you have goose bumps yet? I do. I get them every single time I talk about businesses who are thriving while changing the world. .
My favorite quote from my new book (don’t mind me as I toot my own horn) is:
“Instead of sitting back and waiting for the money to roll in so we can support the causes close to our hearts, I believe that when we support the causes close to our hearts… the money will roll in.”
If you’d like to learn more about how you can grow your business by supporting nonprofits, please download the first few chapters of my book Do Good to Do Better: The Small Business Guide to Growing Your Business by Helping Nonprofits here: https://www.sherylgreenspeaks.com/do-good-to-do-better/
My journey hasn’t been an easy one, and it’s nowhere near over. Who knows, maybe I’ll write a follow up piece in a few years with my next set of screw ups. Hopefully, armed with this knowledge, you’ll be able to avoid some of the missteps, headaches, financial losses, and fetal-position hysteria that I’ve endured.
May your entrepreneurial journey be prosperous!
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