Disclosure: This post is sponsored by Comcast. All opinions are my own.
When you start a new business that you’re going to work hard at and putting a lot of yourself and your time and resources into, you want to be sure it’s the right time. How do you know when you’re ready to start a new business (and when you’re not)?
Here’s when not to start a business:
You’ve found a cool location, but still have no idea what business you’re starting
A cool location is great, but how do you even know if you need a location, if you don’t know what business you’re starting? Step back and take a minute before you sign that lease. You’ve put the cart way before the horse.
Your business might not need a location at all – many successful businesses today don’t even require a brick-and-mortar location and are run completely virtually. Additionally, there are co-working facilities and incubators to choose from. Don’t be too quick to choose a location!
You read some articles about a “hot” business idea
All too often, magazines run articles about the next “hot” industry or business idea. Be wary, intrepid entrepreneur. Magazines typically write articles months before the magazine is printed. By the time it hits your mailbox or newsstand, the information might not be entirely current. Additionally, before you jump into any business, you should thoroughly think through and research the business to assess its short and long-term viability.
For example, as this article from Comcast Business Community mentions, you’ll want to be able to solve a Tier One problem for your clients. As the author mentions, “It’s easy to identify Tier-1 problems. You don’t have to be a market maker or a clairvoyant. One way of doing this is to follow the disruptions and create businesses to support the incumbents who are being disrupted.”
You and your friend have a great idea you’re sure will be a winner
Joining forces with a friend to start a business always seems like such a great idea, doesn’t it? Except partnerships are often fraught with unanticipated challenges that can quickly derail a business. Partnerships are only fun as long as everything goes well…so before you and your friend start setting up shop, sit down for the difficult conversations and talk about what happens when you disagree.
You’re desperate for cash
There’s a saying among salespeople: The hardest time to make a sale is when you most need to make a sale. If you’re desperate for money, starting a business could be extremely difficult, because your desperation will show through everything you do. You could even end up choosing a business that isn’t right for you, or falling prey to scams, because you need the money.
However, if any of the following apply, you might be ready to start a new business:
You’ve been making a profit at your hobby for awhile
If you’ve been playing around with a hobby and making a profit for a while (which you still have to claim on your taxes, by the way), and you think you could really make a go of it, then it might be time to start a new business.
You’ve researched the market and there’s demand for what you want to do or sell
If there’s demand for what you want to do or sell, and you can meet that demand, before you start a new business, talk to some of your potential customers and see if you can start to build that demand. Make sure there aren’t a lot of competitors doing exactly what you do, how you want to do it, and that you can identify what’s setting you apart.
One of the best ways to research the market is to ask your prospective customers. As my friend John Jansch mentions in this article from Comcast Business Community, “I always like to interview my best customers to find out what they find valuable about my service.” You can take that advice and apply it to your prospective customers and find out what they would find valuable about the service you want to provide or the product you want to sell.
You love it enough to do it full time and you’re really good at it
If you love this thing enough to do it full-time (and then some), and you’re really good at it, then it might be time to start a new business. A new business takes a lot of time, so you should enjoy what you do with the bulk of that time, otherwise you’ll be miserable all the time. That said, remember that every business has tasks and chores that you won’t love to do. As long as you’re doing the thing you love most of the time, that’s what makes the rest worthwhile.
You can carve out enough time to do it part-time (at least!)
If you can carve out enough time to run a business part-time, then you can start a new business. Family should be a priority, so don’t forget to make sure there’s still plenty of time for them! But if you’re really committed, then you might start your business in the wee hours of the morning, while the rest of the family sleeps. It’s not easy, but it might be worth it!
You have some savings set aside
Generally, I don’t advise anyone to start a new business full-time, unless they have at least six months savings set aside, and I feel more comfortable when my clients have a full year’s worth of savings. You never know how long it will take for a business to become profitable – anyone who tells you that they do is not being honest. Projections are just numbers, and things don’t always go the way you think they will. So be sure to have the money set aside, just in case.
The decision to start a new business is a big one and should be taken seriously. Once you start, be prepared to scale up as quickly as the business grows. Comcast Business provides flexibility with services that are scalable as your new business grows. This means your company can expand at any pace and Comcast Business is able to provide whatever services or products that your evolving company needs. If you really are ready to start a new business, be sure to check this additional checklist of strategies from Comcast Business to help you succeed.