3 Common Mistakes New Entrepreneurs Make

Posted by JuJuan Buford @JSBUFORD 

 "Start from the bottom up and work like a son of a gun" *FATS WALLER*

Failure to Define the WHY

We’ve all heard the axiom, people don’t care how much you know, until they know how much you care. It’s especially true when you’re just starting your endeavor, given the fact that you may not have much of a track record to run on. It’s imperative that you are able to define what about your business makes you passionate about serving others. Money is a lagging indicator of the value you are delivering, and how effective you are communicating your passion (need) for your services or products. Consider the following….

Your WHY is tantamount to your competitive advantage. Entrepreneurs are problem solvers, creatives, filling an unmet need or void. Your WHY was more than likely born of a desire to address a burning desire or need that wasn’t being met. It’s impossible to succeed absent a competitive advantage long term, and your why helps you define your advantage.

It serves as your identity and it should (and it will) be reflected in your marketing, how you treat your clients, and the quality of the services or products you provide. Success is very much an attraction game. Not to be cliche, but think about how some people pledge allegiance to Apple products.

Knowing your reasons for being in business makes it easier to to identify your Yeses and Nos. It allows you to make blink decisions, as opposed to being dragged through experiences you never intended to go through in the first place. Or in other words, it will insure your efforts are succinct and impactful (this word needs to be added to the dictionary) like a laser cutting through all the distractions, as opposed to a light bulb.

If people believe you’re only in business for the sake of parting them with their money, rather than delivering value to them, it’s not a good look. You can’t craft a genuine story, create emotional attachment, or interest absent a compelling WHY.

“Running a start-up is like chewing glass and staring into the abyss” *Elon Musk*

When you’ve been accustomed to working at a job, it’s easy to take for granted that someone was willing to pay the price to scale their idea and manage the cost of revenue. It’s a fancy term meaning = all the expenses - like utilities, rent/loans, technical services like accounting, research, and legal assistance, your compensation, equipment, supplies, etc. etc., - that must be paid for before the business produces a profit.

Yes, all that stuff and some. You have to be willing to do some things and invest in some things in the beginning that you are not being compensated for, so that you can later on be compensated for things you no longer have to do. New entrepreneurs fail to assess how much work is going to be required, very, very, often.

I sat down with a financial services professional a number of weeks ago, who shared the desire to earn a $100,000 annually in their enterprise. The first question I asked was, how many dials or invitations are you making per day, and how many times are your prospects being presented to (educated) about your services under favorable conditions? The response was about 20-30 dials a day. My next question was how much do you earn on average when a client patronizes you? The response was $300. This was the spontaneous, elementary approximation that was immediately being produced as I listened.  

• In order for this to work, 300 clients at minimum will need to be secured.
• Over 48 weeks = 7 new clients per week
• With a closing ratio of 30% (respectable), you would need approximately 21 presentations per week.
• 100/30/10/3 = 100 dials; 30 pick up the phone; 10 appts. scheduled and 5-7 stick; 2-3 yeses per day.
• All of this would need to happen in a perfect world.

Obviously 20 dials wouldn’t cut it. And therein lies the challenge. Whether it be opening an ice cream parlor, clothing store, organic cupcake shop, the next app company, etc., there is going to be pain. And if your WHY isn’t strong enough to propel you forward when herculean winds are blowing in the direction of retreat, many simply fold.

Entrepreneurship is Experimentation

There is no silver bullet, perfect script, or fail safe social media tactic. At the end of the day we are all experimenting. One approach is not guaranteed to work for everybody. The marketplace is the people, and people discriminate according to their tastes at the moment.

Are there universal truths, principles, universal laws in business? Can you track these truths so to speak like constellations to reach a given destiny? Yes. Just remember, even stars supernova. In other words the landscape can change dramatically. You’re better off, learning from the successes of those who have preceded you, rather than simply emulating them. Pick up the fruit, spit out the seed, and chart your own destination.

If you are an entrepreneur, the aforementioned shouldn’t be too difficult given our general dislike for unquestioned authority and orthodoxy. Inculcate the habit of plan, do, review.

#entrepreneurshipisempowerment 

JuJuan Buford is a Detroit native, a successful entrepreneur, activist, writer, and public speaker dedicated to helping families, entrepreneurs, and business owners establish thriving enterprises, achieve financial independence, and build lives of satisfaction.

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