Workzone: Mix entrepreneur spirit with care
It is a moment of great freedom bound up with great risk: liberation and anxiety rolled into one.
But don't quit your day job too soon.
"I always say, 'Fail on paper first,' " said Bill Ringle, a principal in The Callidus Group, a consultation firm that advises budding entrepreneurs.
His partner, Bob Graham, agreed, adding that before you start a business, you have to come up with the "Three Ms": the Me, the Market and the Money. Can the new business support you, and is it something about which you are passionate? Is there a market for the business, and who are the competitors? How much money will it take to get going, and what are the projected returns?
But, given all the research needed, Mr. Graham said a potential entrepreneur also can be held back by overanalysis, or what he calls "ready, aim, aim, aim ..." -- when one keeps examining the situation and never gets to fire.
Three weeks ago, Belinda Yeager-Carter pulled the trigger and quit her day job in advertising.
The new advertising firm Ms. Yeager-Carter started with her former co-worker, now business partner, Travis Norris, didn't have any clients, but was about to. It got to the point that it was time to shoot.
The new business, Simply Fluid, is built on their combined years in advertising and the notion that they could closely integrate levels of ads, such as print and websites.
Ms. Yeager-Carter, who has a financial background, did not just wander out into the cold away from her employer. She put together the financials: what they needed to survive a year, what they will need to rent space -- they are working out of their homes now -- and how much they will need to hire staff as they grow.
They also had a market analysis of the industry segment they are targeting.
"I understand how this industry works," she said. "I know the ins and outs of the business."
But, nevertheless, she mapped it out by putting together a financial statement.
As for the "Me," both Ms. Yeager-Carter and Mr. Norris were aware they were going to take a financial hit for at least a little while, but they have supportive spouses and some savings. On the negative side for them starting a small business: They each have young children at home.
Ms. Yeager-Carter likened starting a business to having children: "If you wait for all of the conditions to be perfect to have children, you would never have children." Starting a business is much the same, she said.
Now, instead of working for someone else, Ms. Yeager-Carter is the chief strategy officer in her own firm. Mr. Norris is the chief creative officer.
Mr. Ringle, the consultant who years ago reopened a steel mill, said he likes the idea put forward by Rebecca Harris, executive director of the Center for Women's Entrepreneurship at Chatham University, that you should have a year's earnings saved up to live on while your business is starting.
But, Mr. Ringle said, you probably shouldn't have two or three years of salary saved, because that would be a sign that you are too risk averse to be your own employer.
Anyone who opens a business has to be willing to take a risk, because even if you are ready and aim really carefully, sometimes you miss the shot.
First Published November 18, 2012 12:00 am