So you’ve decided that you want to start a service business? Or maybe you’ve already started a business but it’s not giving you the lifestyle that you desired, so you want to switch directions and need help figuring out what you want to start? Or maybe you already started a service business, it’s giving you a pretty good lifestyle, but you’re miserable because you hate what you do. If you fall into any of these categories, then this post/series is likely for you.
The point of this series is not to tell you exactly which service business to start. I can’t do that. I don’t know you like you know you and there are literally hundreds if not thousands of different types of service businesses you can start. But, what I will do is walk you down a path of questions that you can ask yourself which I hope will help you decide on a specific direction. At the end of the day, the biggest killer of starting a business is indecision. This leads to no action, which leads to dead ideas and dead dreams. It’s better to make the wrong decision (that seemed right at the time) than no decision. In a wrong decision, you’re still moving forward because when you’re moving you can always reroute. Sometimes the way to get onto the right path is to figure out what the wrong one is… and sometimes the only way to know that is in the process of moving and doing. Action is the key and this starts with a decision. My goal is to help you make the decision of which service business you should start, but even before that, let’s first examine your motives. If you’re doing it for the wrong reasons you will most likely fail. Why do you want to become an entrepreneur? Below I will list some of the reasons I have heard and I will break them down for you so that you can see the reality of things and give yourself a gut check.
- I want to be an entrepreneur because it’s cool. This is a horrible reason to start a business and I bring it up because entrepreneurship has become the “cool thing to do” lately. If you get into business because you think it will improve how people perceive you, then you will most likely be crushed from the inside out. What do I mean? If you’re starting your business for this reason, then chances are that you might be insecure in yourself and you really put an emphasis on the opinions of others to the point where it impacts your life’s choices and decisions. This will be your downfall. Never have I started a business “to be cool”, but I have been affected by the impossible standards and assumptions of the inner circle around me that I didn’t set straight by being “real”, which ultimately became one of the many reasons for the downfall of that first local business endeavor I had started. It’s very difficult for people that start a business to connect with people that have never done it. They just don’t understand the process, realistic timeline and ultimate struggle of starting a successful business. It’s not easy. When I started my first local business with my two best friends, we fell into the “giving a shit what people think” trap and it is comparable to getting shot, not fixing the wound, and slowly bleeding out. We were doing something that most would not. We were taking a leap of faith that seemed impossible by our inner circle. It was crazy for people so young to start their own business and quit their jobs from their perspectives. The people around us started to build up crazy assumptions about us that started to create a standard that we couldn’t live up to. This began the divide. Then we got an office downtown that was almost 2000 square feet and on the main street with huge windows. We worked out a great deal where the rent amount was unbelievably low. This office only raised the standards and expectations of us from those around us. If we have an office in downtown that looks so great and has a rooftop, we must be doing amazing. We must be rich. In fact I remember someone coming up to me and saying something along the lines of.. “I hear you’re pretty rich”. It was hilarious for me seeing as I was driving a 15 year old Nissan Altima and barely had enough money in my account for a coffee, but people around me thought we must be rolling in cash money. This was far from our reality. We were a struggling startup. It didn’t take long for us to go from being socialites that were the center of attention to introverts holed up in our offices slowly disconnecting ourselves from everyone and creating an “us against the world” mentality. How could we explain that we couldn’t go out and chill because a restaurant meal isn’t in our budget to people that put us up on this crazy high pedestal? That would be a high and mighty fall. One I should have humbly taken in hindsight. By severing ourselves from our inner circle, we essentially put a death sentence on our business because in business it’s all about networking and the people around you. Especially in a client based business like the one we were in. We cared what people thought more than we cared about growing our business and that ended up being one of the things that killed our business. Don’t set out to start a service business because you think it’s cool and will make you seem bigger and better to those around you. “If you fuel your journey on the opinions of others, you are going to run out of gas.” – someone.
- I want to be an entrepreneur to get rich. – Making money is definitely one of the motivators for starting any business because without money you can’t be in business, but the desire of money alone will not get you through the tough times, especially if you have the “get rich” mentality. If your sole motivation of getting into business is to get rich, then when tough times hit, you will quickly buckle and chase more guaranteed and easier money like the comfort of a 9 to 5 job. Also to “get rich” is a horrible goal. You have to be realistic. Unrealistic expectations will turn into your main source of demotivation when you don’t get what you want quickly. If you really figured out what you want from life, you would quickly realize that it doesn’t take millions of dollars to have everything you want plus more. You hear “follow your passion” so much these days because if you do something you love or really believe in, you will be able to run the marathon of starting a successful business to the end. Now, I’m not saying you have to start a business doing something you love and are passionate about to get started. We’ll get into that later. I’m also not saying that you won’t be rich. I’m simply saying that it’s not a good “main reason” to start a business.
- I want to be an entrepreneur to provide jobs. – This should be a byproduct of starting a business that grows into something successful and not a starting goal. In the beginning it can be tough enough just to have money left over to reinvest into the business to see growth, let alone have enough money after expenses to pay yourself. In the beginning you will most likely be wearing the hats of most if not all of the job titles in your business. Having an employee is great and rewarding once you can, but if you hire someone too early in your business it can be a huge burden and drain that can lead to the failure of your business or the uncomfortable situation of firing someone that depends on the work to feed their family.
- I want to be an entrepreneur so I can work less. – If you tell this to anyone that has started a business, they will laugh at you. If you decide to start a business then you better be ready to say goodbye to 40 hour weeks and say hello to 70+ hour weeks. It’s like having a baby. Once you give birth you barely sleep because the baby is always crying, needs to be fed, needs to have the diaper changed and needs to be constantly monitored. Year by year, the baby grows and becomes more independent and eventually becomes an adult that is no longer a financial strain and starts to make their own money.
- I want to be an entrepreneur so I could be a boss and answer only to myself. – While technically you will have no boss since you’re on top of the ladder, you still have to answer to people and you will. These “people” are your customers, clients, employees and yourself. Depending on the type of business you’re in, the attention varies. Let’s look at examples:
- Your customers – Without customers, you have no business. For example, let’s say you run a pressure washing business. You get hired to wash someone’s driveway and you miss a spot. They will call back and complain and it could be at any hour of the day. If you don’t answer them and make it right, they could have their payment returned with the bank. The more you grow, the more customers you will have which will lead to more potential problems that need to be solved by answering to your customers.
- Your clients – Client type businesses are more longterm relationships where your services typically don’t last a day and they typically pay more over time compared to a customer for a quick job. Client businesses could be things like web design and marketing, book keeping services, etc. Client businesses tend to take more attention from you as the owner because the type of work tends to be ongoing for long periods of time. Client businesses also tend to pay much more and you depend on the income from one client much more than you would from a customer. Because client work takes up much more time, it pays more and you are limited to a certain amount of clients that you can handle so when you lose a client, it hurts a lot more compared to a customer based business that has high volume but low income from each customer. Because of this, depending on what business you’re in and the structure that you have setup, you may find that every client is like a boss that you answer to.
- Your employees – Eventually you might have employees and you will be working for them as much as they will be working for you. When they have problems, you have problems. If they aren’t happy, it’s your problem because they aren’t performing at their best which affects your business, or they might leave which could cost you time and resources to hire and train new people. If they aren’t doing the job right, it’s your problem because your customers or clients won’t be happy and you could lose business. Any issues that come up in your business become your responsibility and fault by default because at the end of the day you have the most to lose. Employees will never do as good as you, work as hard as you or care as much as you because it’s not their baby.
- Yourself – This can be a tough one because it requires you to be super real with yourself. All the good and the bad. At the end of the day you hold the reigns and it’s all under your control and authority. This means your decisions are yours to make but you have to face and own all the consequences of your decisions. Since you are the king of your castle you can choose to work or not to work. To sleep in or not to sleep in. To take time off or not take time off. No matter the decision you make, there are always consequences. These could be good consequences like business growth or bad consequences like business loss. It’s all in your hands. You have the power to do or not to do, but at the end of the day, the results are based on your decisions and you can’t fool yourself with excuses. You answer to yourself at the end of the day.
- I want to be an entrepreneur so I can save the world. – Saving the world is a noble cause but it isn’t a good business strategy. You’re in business for profit. To make money. If your product or service can help the world, that’s great, but for it to have a chance at getting out there successfully enough to impact the world, you have to think like a business. Without coming off the wrong way, this means thinking selfishly for the best interest of your for-profit business. Let non-profit charities worry about saving the world as their first priority. You should worry about building your business and then you can allocate your time and increased resources to help save the world. It’s difficult to help save the world with your business if you aren’t making a consistent surplus of money. Like they show on the planes, first put the oxygen mask on yourself, then on others that need your help or you’ll most likely both suffocate in the process and no one wins.
- I want to be an entrepreneur because I want to have fun. – While the journey of running and growing your own service business will be fun and rewarding, you will still have to do many things that are the furthest thing from it, especially in the beginning when you’re wearing every hat.
- I want to be an entrepreneur because I think it’s easy. – Nothing is further from the truth than this. Starting a business isn’t difficult but turning it into a successful and profitable machine is one of the hardest but most rewarding things I’ve ever done. My advice is to not get started if you aren’t ready to work long hours every single day while being OK with not seeing an amazing return right away. It takes patience and extreme hustle. It’s not easy, but it’s so worth it!
My goal isn’t to discourage you from starting a service business, but to paint a realistic picture of what you should expect going forward. Whether you’re seeking freedom of time, freedom of location, freedom of finances or all of these, starting your own business can and will give you the lifestyle that you desire as long as you are willing to work hard, stay patient and stay consistent.
In the next post we will start getting into how to choose a specific service business to start.