It’s great if you turn a recent layoff, cutback or downsizing into an opportunity. Just do a little research first.
With dour economic news pretty much anywhere you turn, it’s no surprise that news outlets are trying to find a silver lining — something positive to report. They have found that story in entrepreneurs. Over the past months, hundreds of stories (for example, here, here, here, and here) have been written about people who have been laid off and are now starting their own businesses.
There’s even a term for this phenomenon — entrepreneurship by necessity. Indeed, in 2008, as the recession deepened, the number of entrepreneurs increased. Some of these entrepreneurs never thought of starting a business until they were laid off. Others had always wanted to start one and used a recent layoff as the kick in the pants they needed to get started. What these entrepreneurs have in common, though, is need: their driving force is money, not a passion or a calling.
At the Acton School of Business, we see things a little differently. While we encourage entrepreneurship, we also believe you need more than just a hunger for money, fame or power. We believe that you should use your passion and talents to fill an unmet need in the world.
Instead of starting a bakery because you’re sick of sending out resumes and someone once told you your chocolate chip cookie recipe was amazing, take some time to do some research. What are you really good at? What would you love to do? What products or services are missing in your community or what is something people really need?
It’s great if you turn a recent layoff, cutback, or downsizing into an opportunity. Just do a little research first. Make sure that the freedom and potential cash rewards outweigh the risks, uncertainties, and the long hours. Acton Master Teacher Steven Tomlinson notes, “Entrepreneurship isn’t a fallback plan. It’s a huge commitment that will take everything you’ve got — but it’s worth it.”
We’ve created an assessment to help you determine whether you’re ready to be an entrepreneur. Click here to take it now.
If you think you have what it takes to be a principled entrepreneur, here’s some Acton advice so that your foray into entrepreneurship is a successful one:
1. Gain in-depth knowledge of the competitive structure of your industry and build a network of contacts within that industry. The world is too competitive to start a business without a deep understanding of your industry. What are the key industry trends and how do they affect your position? Why do people buy your product and what substitutes do they have? Which vendors and employees can you trust?
2. Acquire the skills to run the daily operations of a small, rapidly growing company. If the company culture if flawed, almost any strategy will fail. How are you going to manage accounting, production, organization, and administrative dilemmas? How are you going to create a company culture?
3. Learn how to raise money. Fail to raise it or run out before the venture turns cash-flow positive, and your business will die. Who are going to be your main sources of money? How much money are you going to need in the future? How risky is a particular investment going to be?
Good luck in your entrepreneurial endeavors!
The tips above were excerpted from the AFEE note “So You Want To Be An Entrepreneur?” Click here to read it in its entirety.
Photo courtesy of jenrosenthal.
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