Do You Have "The Right Stuff" to Open a Business Right Now?

Five Questions to Ask Before You Build Your Startup

With barriers to entry lower than they've ever been for many types of businesses, it can be easy to overlook the fundamentals necessary for a startup to succeed.

While it's certainly true that you can start a business today with no physical location, no employees and next-to-no overhead, relying on little more than a good idea isn't enough. Behind every successful business is a dedicated entrepreneur whose sweat and determination made their dream a reality.

You’ll want to start by taking an honest assessment of your readiness to start a business and see it through to success. Here are five questions to ask before you begin to build your startup (the first question is the most important):

Why Do You Want to Start a Business?

There is a myriad of reasons you might want to start a business. Do you have a passion for a particular product or service, and are you willing to do whatever it takes to share it with the world? That's a great reason!

Do you just feel like not making the commute to your current job and would rather "do something else" instead? That's probably not the best reason.

There undoubtedly will come a time in your business when you'll have to rely on your passion to see you through. There will be setbacks and long hours and all manner of frustrations. At those times, it will be the vision of fulfilling your passion that will sustain you.

And that passion will also be infectious. It will draw clients and customers and employees (or freelancers or contractors) who share that passion. It may even help you get funding.

Are You "Built" to be a Business Owner?

Passion and desire are great. But there are also several traits that are common to most entrepreneurs. A successful entrepreneur is generally a "people person" (they like communicating and sharing ideas with others), they're hard workers (50–60 hour workweeks are not all that uncommon) and they don't give up (you'll hear "no" a lot when you're starting out).

Entrepreneurs are also generally comfortable taking calculated risks, making decisions, and playing different roles in their business as necessary. They also tend to have a knack for recognizing opportunities when they present themselves.

Are Your Finances Ready for the Strain of Starting a New Business?

Very few businesses will turn a profit right out of the gate. Quite the opposite. Most new businesses won't make a profit for their first six to nine months of existence. First and foremost, you'll want to assess whether you can go without an income for that long (especially if your new business requires that you quit your current job).

Next, think about your credit history. Will you be able to obtain any necessary financing? Do you have a history of managing debt responsibly? Will potential investors or lenders see you as a good risk?

Is Your Vision of Success Clear?

What are the reasons for starting your business? Do you know what success looks like? How will you know when you've "arrived”? You've probably heard the line from Alice in Wonderland: "If you don't know where you're going, any road will take you there." That applies to new businesses as well.

How will you determine what it means to have a successful business? What is your "WHY"? Is it defined by the money you make? By the freedom it gives you? By the people you reach? Or the cause you champion?

Success means different things to different people. What does it mean to you?

Who Makes Up Your Support System?

Nearly every successful entrepreneur has a cheering section they can turn to for inspiration. And many will have "practical" supporters, like a former boss or work colleague, who can offer insight and advice about business matters.

Reach Out to a SCORE Mentor for Help Determining if You're Ready to Start a Business

A SCORE mentor can guide you on your entrepreneurial journey and help you determine if you're ready to start a business. They can also stay by your side as you navigate the many obstacles you'll encounter along the way. For more information and to find a mentor, visit www.score.org.