hackbash

Off on a tangent again, but a good friend of mine is thinking about starting a business, and it’s made me reflect on the things I learned from my own experience.

Here, then, I humbly offer my five rules for starting a business:

1) Stand out. This means doing something no-one else does, or doing it better or cheaper than existing competitors. If there’s competition in an emerging market, get in and be better or find another plan.

2) Plan. Make a business plan. You can show it to friends or advisers for their input, and use it as something to help you focus when things get busy. Stick to it, but don’t be afraid to adapt it as you go. Also, you’ll need it for the next point.

3) Do it with somebody else’s money. Unless you’re absolutely loaded, don’t risk your own money beyond the very early stages. This doesn’t necessarily mean bowling up to private equity; investigate any loans, grants or guarantees for which you might qualify, like the Small Firms Loan Guarantee scheme.

4) Pay yourself. You need to live. Your grand idea might make you rich one day, but in the meantime you’ve got the rent and an empty stomach. Make sure your finance and business plans include a realistic income for you.

5) Concentrate on your strengths, outsourcing your weaknesses. Know what you’re good at, make sure it brings in money and concentrate on it. Know what you’re shit at (in my case selling and the drudgery of admin) and hire someone to do it - on an ad-hoc basis or using short-term contracts if necessary.

Would you take business advice from this man?

At least, these are the five boxes I’d want ticked if I was going to do it again. I should point out that my business wasn’t ultimately successful, which either makes me the worst or best person to give advice.

An old friend of mine has made a success of a business without doing all of the things above, but she’s chiefly done it through ability and an amazing strength of will that I’ve never seen in anyone else, certainly not me.

Incidentally, if you’ve got young kids, download the trial versions of her games - they’re really good, which is the other reason she’s been successful.

Tags: business, experience, tips