Starting a business? Are you eager to turn your hobby into a money-making business? Running your own business can be rewarding in many ways, but before you give up your day job, be sure you are realistic about what you'll be doing when you become the boss. Here's a good look at some of the realities you're likely to encounter in your startup years.
In February of this year, I celebrated my 7th anniversary of leaving the corporate world to pursue a lifelong dream of opening a bakery. Having spent the prior seven years as an investment banker, I realized that now I can compare my two careers, to use an investment banker cliché, on a "apples to apples" basis.
On the one hand, I've made a lot less money in these last seven years than I did in my first seven. On the other hand, I haven't worn a pantsuit since early 2004. Pantyhose either, for that matter. I've successfully avoided bailouts, mergers and layoffs, and I control my own destiny. But to control my own destiny, I've invested much of my life savings, not to mention time and sweat equity.
My day-to-day job is not glamorous. On any given day, it can involve washing dishes, paying and filing bills, bussing tables, putting out figurative fires, patiently explaining to a customer why we can't tint chocolate icing pink, and endless other headaches. Despite that, I love what I do for a living, and I am infinitely happier in life than if I believe I might've been had I not left.
I am living my childhood dream of owning my own business. To top that off, I make sweets all day and get to decorate cakes for a living -- two things that constantly bring smiles to peoples' faces. My daughters understand what I do and are proud of me. So I can confidently tell you that leaving a corporate job to turn your passion into a profession can be immensely fulfilling, as long as you don't go about it haphazardly.
8) Get the money lined up.
Save up if you have to. Approach potential investors and lenders. Figure our your financial fall-back plan. Don't expect to start a business and then walk into a bank and get money. Traditional lenders don't like new ideas and don't like businesses without proven track records.
9) Be professional from the get-go.
Everything about you and the way you do business needs to let people know that you are a professional running a serious business. That means getting all the accoutrements such as professional business cards, a business phone and a business email address, and treating people in a professional, courteous manner.
10) Get the legal and tax issues right the first time.
It's much more difficult and expensive to unsnarl a mess afterwards. Does your business need to be registered? Will you have to charge GST or PST? Will you have to have Workers' Compensation Insurance or deal with payroll taxes? How will the form of business you choose affect your income tax situation? Learn what your legal and tax responsibilities are before you start your business and operate accordingly.
Following the advice on starting a business above will make starting a business both a smoother, less stressful process and go a long way towards ensuring the busines you start lasts and thrives.
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