- Thinking creatively
- Money math
- Talking to people
- Time management
- Knee jerk reaction to market
The biggest risk is not taking any risk. In a world that’s changing really quickly, the only strategy that is guaranteed to fail is not taking risks.
Entrepreneurial success is far from guaranteed. You will inevitably take personal and financial risks to get what you want. But how do you feel about risk, and how can you minimize the risk of starting a new venture?
Let’s explore these ideas.
1. Developing the Vision and Business Idea
Developing a business idea is usually the first challenge faced by every entrepreneur when starting a business from the ground up. Finding the right business opportunity or creatively developing an idea is certainly not an easy task. But seeing opportunities is just the beginning. The main business challenge is going to be your ability to forge that opportunity into a business idea.
Developing a vision is definitely a business challenge. Most individuals are comfortable with the present way of doing things but it is the duty of an entrepreneur to envision and forecast the future. It is the duty of an entrepreneur to bring into present what is yet to be. Here are a few illustrations:
- In the late 70s and early 80s, while IBM saw increase in demand for their mainframe computers, Steve Jobs envisioned a personal computer in every home and Bill Gates envisioned the need for easy to use software for personal computers. That single vision made Bill Gates the richest man in the world and Steve Jobs the most famous business person of the 21st century.
- The Wright brothers envisioned a flying machine but they were massively opposed because the thought of humans flying was perceived as impossible. Today, we don’t think twice about jumping on an airplane.
- Back in the days when cars were custom made and exclusively for the rich, Henry Ford envisioned affordable cars for the masses. That single vision made Henry Ford one of the richest men in history.
2. Raising Capital for your Start-up
After developing your idea, the next challenge you are going to face when starting a business from scratch is that of raising capital. As an entrepreneur, you are the only one that knows your business idea to the core. You are the only one that knows the story of your future. Trying to convince investors about something that doesn’t exist is definitely a challenge. Trying to make them understand that you are trustworthy and equal to the task is not child’s play especially when you are building your first business.
3. Assembling a Business Team
The third business challenge you will face in the course of starting a small business from scratch is assembling the right business management team. The process of building a business team starts even before the issue of raising initial start-up capital arises.
As an entrepreneur, you are bound to have strengths and weaknesses. That is all the more reason you need a business team to cover up or compliment your weaknesses. A team is a necessity for building a successful business.
4. Finding the Right Business Location
Is finding a good location a business challenge? I don’t know but what I do know is that finding a good business location at the right price is definitely not easy. How do you get a location that has a rapidly growing population, good road network and other amenities at a good price?
5. Finding Good Employees
Business owners know how difficult it is to find a hardworking, trustworthy employee. Finding a good employee who will be passionate about delivering his or her services is quite difficult. Finding good employees is a minor task compared to the business challenge of forging your hired employees into a team.
You may have great employees but if they can’t act as a team, they are worthless and will yield nothing but stagnation.
6. Dealing with Competition
Competition is the next challenge you will face when starting a business. Competition can be a good challenge; a benchmark for creativity, the main engine that stimulates innovation and production of quality products at great prices. Without competition, there will be no innovation and without innovation, the world will be stagnant.
7. Unforeseen Business Challenges and Expenses
Just as a sailor prepares for unexpected storms, or a pilot is always on the watch for unpredictable bad weather and thunderstorms, so must an entrepreneur be prepared for whatever comes.
Unexpected challenges can come in the form of:
- Unexpected lawsuits
- Inconsistent government policy
- Not being able to make payroll
- Unpaid bills and taxes
- Unexpected resignation of staff