When people want to learn how to start a small business, the most basic mistake they make is that they get carried away with their dreams. We all know that there is no limit to human dreams, so people dream really big and the “small” business venture they have in mind, is not really small. Before they know it, it becomes quite big and turns out, in the long run to be more a liability than an asset because of the serious planning mistakes that people make.
Whenever you want to launch something new, don’t get carried away with yourself. The key to success is to start small, really small and set yourself scalable goals. When you get your first taste of success, you invest whatever money you’ve made and then start expanding – slowly and gradually.
Why is this something I stand so strongly by? When you start a business- any business, you will lose money at the initial stage. So when you’re starting small, you might lose say a couple of thousand dollars, but that is much better than losing say, fifty thousand dollars at one go because you wanted to start off on a high note!
Plus, when you start small, you will get to evaluate your entire program stage by stage and make the necessary changes before you do decide to scale up and go big. Plus, because of the constant evaluation process you will be subjecting your business to, you will have a much bigger chance at success than you otherwise would have.
Next comes funding. This is one of the questions which have entrepreneurs in a quandry when they are figuring out how to start a small business. Of course, there are many financing options out there, but which one is the best one for you? Which one will suit your needs? Which one will not result in you having to hand over your business to someone else?
Most small businesses have three options for financing:
- Friends and family
- Bank loans
Each of these has their own pros and cons. If you want investors or friends and family to put in their money into your business, be prepared to give them a stake in the companythis contact form. Banks put additional pressure on your business, because you are saddled with having to pay back the bank loan, with interest in a definite period of time.
There’s a novel way of getting funding if you really are that serious about it and it’s relatively risk free, it’s called a “Thrust Fund”, where you secure funding by offering a share of your future earnings to the person who will fund you. You don’t have to give them a stake in your company. So it’s like selling a piece of your earnings and that’s where it ends!
Apart from that, there are of course angel investors, you might like them, you might hate them, but you can’t deny that you need them; they will definitely guide you when you want to know how to start a small business because they have experience on their side and want you to succeed because their money’s riding on it!