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  #1  
Old 1 April 2018, 10:08
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The Fat Guy The Fat Guy is offline
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Guide to Starting your Own Business...

As this is more of an educational thread, I put it in here. The SBA just posted 10 common sense points to consider when starting your own business. We have many successful entrepreneurs in here and others like me that started their own business, well, just because. Discuss the points here or ask any questions about starting a business.

One in specific that is not listed on the top 10 is get insurance.

Discuss......
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  #2  
Old 1 April 2018, 10:40
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HighDragLowSpeed HighDragLowSpeed is offline
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I would add:

- Agressively seek out very honest criticism about the business model from people that have started successful business and, better yet, failed at a business before being successful.

- Really take the above advice even when they "call your baby ugly". It is what it is

- Watch the Shark Tank marathons. If you have a tech idea or really want outside capital, listen to critique that Mark Cuban has. His questions and concerns are about as reflective of every successful VC I've known. I regularly tell friends that start tech businesses that it is free consulting that only costs you your time.

- "Your product isn't your business". The biggest mistake you can make is knowing your product but not knowing or having a plan for the business. Most businesses fail for this reason. Until you're paying yourself a salary and making a profit solely from revenues, it's a hobby not a business.

- Get your binding legal agreements in place early for any partners and for your customers. Those shortcuts and handshake agreements you take early on will likely come back around and not in a good way once real money is involved.

- A tidbit I learned early on: There are good customers and there are "grinders". Grinders negotiate far below market value for your product/service, willl wear you out with their demands, and will take resources from searching for good customers. Grinders can be large companies too. The more your differentiation is on price, the more grinders you'll attract. Diferentiate on something other than price otherwise the customer perception is that you can be taken advantage of since you don't know your value and you'll always be racing to a zero price point as competition increases and customers hear about your other customers' pricing.

HTH
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  #3  
Old 1 April 2018, 11:27
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STFU about Politics & Religion...

Especially if you're you're using the different platforms for advertising on "social" media (SM).

Word-of-mouth travels quickly and WILL eventually end up on some type of SM platform.

Always carry "professionally-made" business cards; Vistaprint is inexpensive.
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  #4  
Old 2 April 2018, 23:30
ExSquid ExSquid is offline
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Short story, I once worked for a small local business where the owner knew bunches of other small business owners. He had a friend who every year reviewed his customers and got rid of the 10% who were his biggest headaches. Didn't matter if you were the biggest or smallest client, what mattered was how much trouble you caused him. He figured 90% of his problems came from 10% of his customers and getting rid of them allowed him to better serve his 90% that only caused 10% of his problems.

x/S
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  #5  
Old 3 April 2018, 09:03
PocketKings PocketKings is offline
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Quote:
Originally Posted by HighDragLowSpeed View Post
Until you're paying yourself a salary and making a profit solely from revenues, it's a hobby not a business.


HTH
Yep. A really expensive hobby, when opportunity costs are factored in.
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  #6  
Old 3 April 2018, 09:24
Zamir Zamir is offline
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Get a mentor or several for different areas of business!

Surround yourself with people that are successful in their own right. Meet with them on a consistent basis.

Do not surround yourself with "business" people who are unwilling to share strategies and techniques that helped them become successful. If people are unwilling to be responsive and answer your questions, they are not a good fit to mentor you.

Many people on this board have been generous to me and provided insight while in a similar line of business. Why? because if you help out a guy that is in it for the right reasons you increase the chances of weeding out those that don't belong. This type of help also creates a strong alliance/strategic partnership in some cases. If I get a client that calls and asks for a particular work product or service that I don't provide...one of my mentors may be better suited to execute the work.

Also, a common mistake I see new business owners make is the word "Yes"...When your business is new you are hungry and want to go after everything under the sun to generate revenue, contacts, etc...Remember...not everyone is a good fit to be a client/customer, it's okay to say "NO" if their ethics and morals don't fit your own as the owner and the one ultimately responsible for your company reputation.
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Old 3 April 2018, 11:15
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Quote:
Originally Posted by Zamir View Post
Get a mentor or several for different areas of business!
+100000000000000

One of the most common traits I see among cops/vets that start businesses are that they are great "idea" people.. they have a good concept.. they are often excellent leaders.. etc..etc..

but they dont know shit about marketing, accounting, finance, budgeting, operations management, project management, negotiations, sales, recruiting, etc..etc.. (fundamental business skills)... and they make poor decisions as a result..

Find mentors... locate people that have already proven themselves in whatever their field of business is and have been successful.. and lean on them... lean HARD if they will let you..

There are several ways to do this.. you dont have to personally know anyone.. the internet has the ability to bring people together..

www.veterati.com is a good option (IMO).. I know of at least a couple of SOCNET members that serve as mentors there (myself included).. its free.. and connects vets looking to mentor/give back with vets looking to get assistance in business..
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  #8  
Old 6 April 2018, 04:14
TypicalFish TypicalFish is offline
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Quote:
Originally Posted by HighDragLowSpeed View Post
I would add:

- Agressively seek out very honest criticism about the business model from people that have started successful business and, better yet, failed at a business before being successful.

- Really take the above advice even when they "call your baby ugly". It is what it is

- Watch the Shark Tank marathons. If you have a tech idea or really want outside capital, listen to critique that Mark Cuban has. His questions and concerns are about as reflective of every successful VC I've known. I regularly tell friends that start tech businesses that it is free consulting that only costs you your time.

- "Your product isn't your business". The biggest mistake you can make is knowing your product but not knowing or having a plan for the business. Most businesses fail for this reason. Until you're paying yourself a salary and making a profit solely from revenues, it's a hobby not a business.

- Get your binding legal agreements in place early for any partners and for your customers. Those shortcuts and handshake agreements you take early on will likely come back around and not in a good way once real money is involved.

- A tidbit I learned early on: There are good customers and there are "grinders". Grinders negotiate far below market value for your product/service, willl wear you out with their demands, and will take resources from searching for good customers. Grinders can be large companies too. The more your differentiation is on price, the more grinders you'll attract. Diferentiate on something other than price otherwise the customer perception is that you can be taken advantage of since you don't know your value and you'll always be racing to a zero price point as competition increases and customers hear about your other customers' pricing.

HTH
This. In spades. I got AMTDirect their first break with a big customer (Enterprise Rent-A-Car) based on a handshake with the twin brothers who run the company at a convention in Las Vegas.

A year later, I go back for my annuity, and it's "What do you mean? We never talked about that".

Pieces. Of sh*t. Lesson learned.
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  #9  
Old 3 April 2018, 09:36
RemTech RemTech is online now
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Go to accountingcoachdotcom (or similar service) and read up on how to do the basics (bookkeeping, double-entry, chart of accounts), then go find an accountant. Knowing the basics will save you money because your accountant won't have to fix all the things you screwed up.
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  #10  
Old 3 April 2018, 10:26
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Hoepoe Hoepoe is offline
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To add just a few to the nuggets of gold above:
1. Listen to the market, even if you have the best thing since sliced bread, if no one wants to buy it, it doesn't matter how "unique" it is

2. Build your business to do good; to make positive change, not just to make money, and lots of money it will make

3. Treat each and every employee and contractor well, they make your business

4. Set a solid infrastructure that will enable scalability

5. Don't be afraid to turn down work you cannot excel in

6. Don't wait for everything to be perfect, plan and execute, but if you wait for perfection, you'll never get to execution of your plan

7. Don't build the business upon what you think the market needs, build it upon what the market actually needs

8. Don't invest on expansion in order to increase revenue, expand as a result of increase in revenue (amateur mistake i think we all make)

9. Stay true to your vision but be flexible in the path to get there

10 Have fun! Seriously, have fun. We spend so much of our live's working, if you enjoy it (mostly), it'll be reflected in points 1 - 9 above

Hoepoe
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  #11  
Old 3 April 2018, 11:03
kosty kosty is offline
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I've started a non-profit, and this thread is tuning up my thinking. Thanks for all your inputs.
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  #12  
Old 3 April 2018, 11:40
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MixedLoad MixedLoad is offline
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All of the above is pure gold.

Another few additions I'd throw out there:

1. Educate yourself on all of the things you do NOT want to do.

2. Get comfortable with being very uncomfortable.

3. Network like there is no tomorrow in the industry and verticals you want to be recognized in.

4. Watch Shark Tank to learn what not to do. Such as giving away 20% of your company for next to nothing. That is neither a good idea nor a great deal.

5. Create operating agreements right from the start. Be specific in them about daily and weekly meetings with any co-founders. Monthly or quarterly meetings with investors. You will not regret this.

6. Be extremely disciplined in how you allocate money. What may seem like a home run early on, can ruin you if you have to pivot later on.

7. Network to attract talent. Be honest, upfront, and candid with anyone you bring on to join your team.

8. Fire fast. You see someone doing something that doesn't feel right to you or flat out crossed your line? Fire them. Immediately. Do not let a cancer spread.

9. Network. I cannot overstate this. Join FB groups, LinkedIn groups, professional meetups. People do business with people, not with companies.

10. Be extremely honest with yourself and where you're heading. Extend that honesty to your team at the right time.
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  #13  
Old 3 April 2018, 12:26
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Quote:
Originally Posted by MixedLoad View Post

8. Fire fast. You see someone doing something that doesn't feel right to you or flat out crossed your line? Fire them. Immediately. Do not let a cancer spread.
This is another HUGE one...

There have been some really good articles and books about "hire slow, fire fast".. Get to know and understand this concept.. and LIVE BY IT..

Sadly, even experienced business managers tend to get this process backwards.. they "need" someone right now.. so the first person that comes along that they think has the right credentials and/or experience gets a job offer.. then when that person doesnt work out, they spend months (if not years) doing everything in their power to try to "save" that person....

Here's a pretty decent article on the concept: https://hbr.org/2014/03/hire-slow-fire-fast
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  #14  
Old 3 April 2018, 12:28
Agoge Agoge is online now
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THIS THREAD SHOULD BE A STICKY!!!!

There is a lot of "expensive" information being provided in this thread!
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  #15  
Old 3 April 2018, 12:40
GotSig? GotSig? is offline
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Take your final Capital needs and multiply by 2.5

Take your final revenue projections and divide by 1.5
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  #16  
Old 4 April 2018, 12:06
PocketKings PocketKings is offline
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Originally Posted by GotSig? View Post
Take your final Capital needs and multiply by 2.5

Take your final revenue projections and divide by 1.5
Yep.
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  #17  
Old 8 April 2018, 20:57
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brcannon brcannon is offline
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Quote:
Originally Posted by GotSig? View Post
Take your final Capital needs and multiply by 2.5

Take your final revenue projections and divide by 1.5
Excellent point.

My business (real estate) is finally becoming profitable and paying dividends almost 3 years after I started it. Ran out of money and had to re-join the rat race 2 years ago.
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  #18  
Old 3 April 2018, 14:04
Long Walk Long Walk is online now
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1) There is a world of difference between being an employee and a business owner. Not knowing the difference will be expensive.
2) Know when to shut the business down. I have been through this. It is really painful, but there are times when you need a mortician and not a doctor.
3) Prospect every day. Networking or direct prospecting or some combination. There is a never-ending need for new business relationships.
4) Learn how to jealousy protect, and grow your existing relationships. Add value everywhere you go. There is always somebody out there prospecting your clients.
5) If negotiations come down to price, or the client only wants to negotiate on price, then you can be sure that the client doesn't see a dime's worth of difference between you or your competitors.
6) Take care of the books. Every day. Small business requires cash flow management skills that can be learned only through experience.
7) If your business requires billing businesses to get paid, you are going to learn the collections process. It is painful to learn. Especially when you are doing it within the context of #4. If you can't or won't learn it, the business will fail.
8) Be careful with debt. It is a tool. But it has to be used carefully.
9) Being a skilled employee in a successful business is not a reliable indicator of success in your own business.
10) If you don't know how to ask for the business, and close professionally, you are going to have a hard time.
11) Pricing, no matter the product or service, is a combination of art and science. You have to know your market and what is being offered. You have to know what the client will accept. And what your business needs. Whether you bill hourly or transactionally, it is the same.
12) Your story will come out in all that you do. If you charge above-market prices, tell the story in a way that shows the benefit to the client. Never back down from your pricing, but tell the story in a way that the client will want to be part of.
13) I heard this from a sales trainer a long time ago and live by it: you can't lose what you don't have. You will lose out on lots of business for any number of reasons. Do an AAR, apply the lessons learned, and move on to the next opportunity.
14) If your business fails, do #13. Pay all your debts from it and close out the business properly. But, then get back on the horse as soon as possible.
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  #19  
Old 3 April 2018, 21:09
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Veritatem Cognoscere Veritatem Cognoscere is offline
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Profit is great but cash is your lifeblood. You might be profitable but with poor cash flow, you might starve yourself.

Mentors and networking (as others stated) are gold.

Higher people smarter than you, lead them well and free them to execute in the areas of responsibility you have given them and then get out of their way.

Don't cheat. Your employees, your customers or your vendors. Pay on time. If you can't, reach out and make a plan with them.
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  #20  
Old 3 April 2018, 21:50
8654maine 8654maine is offline
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Quote:
Originally Posted by Veritatem Cognoscere View Post
Profit is great but cash is your lifeblood. You might be profitable but with poor cash flow, you might starve yourself.

Mentors and networking (as others stated) are gold.

Higher people smarter than you, lead them well and free them to execute in the areas of responsibility you have given them and then get out of their way.

Don't cheat. Your employees, your customers or your vendors. Pay on time. If you can't, reach out and make a plan with them.
"Hire".

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