In the world of entrepreneurship, we often find are often lured into grand success stories, sexy startups, and the pursuit of building the next billion-dollar company.
However, it is crucial to take a step back and reassess our approach to business. By understanding some easy to fall into traps, we can redefine our perspectives and set ourselves up for more sustainable and fulfilling entrepreneurial journeys.
1. Shifting Focus from Sexy to Sustainable
Many entrepreneurs are lured by the glamour associated with certain industries or the desire to build the next big thing. We all want to build the next Instagram or Takealot. We forget, however, that there is a lot more going on behind the scenes with these companies, that are not as great as it seems.
Focussing on the superficial aspects can distract us from the fundamental goal of building a business that gives you:
- Consistent income; and
- Requires minimal time investment.
Instead of aiming for the moon, why not start small and focus on creating something that generates regular revenue while allowing for a balanced lifestyle?
By setting realistic expectations and establishing a sustainable business model, we can enjoy the fruits of our labour without being consumed by the constant pursuit of unattainable ideals.
2. Cash Flow: The Lifeblood of Business
One of the biggest pitfalls entrepreneurs face is neglecting the importance of cash flow.
It's crucial to understand that every business, regardless of its goals, needs to be cash flow positive from the early stages. Without a healthy cash flow, even the most promising ventures can crumble.
Instead of relying solely on passion and big ideas, entrepreneurs must adopt a financially responsible mindset. If you cannot build that generates positive cash flow within a reasonable timeframe. Don't do it. Go work for someone else who can and learn from them.
A solid financial foundation is essential before attempting to change the world with your "innovative ideas".
Disclaimer: there is always the venture capital route, but remember: whenever someone invests in your business - you will need to give something up, whether it is profits, control or autonomy.
3. Rethinking the Hiring Process
Entrepreneurs often make the mistake of obsessing over finding exceptional individuals who possess the same level of passion and commitment they have towards their business.
While it's natural to desire a team of like-minded individuals, the reality is that such individuals are rare, if not non-existent. They are unicorns🦄
Most people prefer stability, clear roles, and being told what to do rather than embracing the chaotic world of entrepreneurship.
Instead of chasing unicorns, entrepreneurs should focus on building businesses that can employ ordinary people to perform everyday tasks effectively.
You don't have to hire someone immediately
One of the most common questions I get asked is: "How many people do you employ?".
The question seems appropriate, the person asking it is trying to gauge the success of your business by seeing how many people work for you.
It's a vanity metric though. Just because 3 people work for me, doesn't mean my business is healthy. Each employee you add is another salary that needs to be paid and another person that needs to be managed.
Vanity metrics are superficial numerical measurements that may appear impressive but lack meaningful insights or contribute to the success of a business or goal. They often focus on quantity rather than quality.
Try to automate first - then hire
My advice, try to automate first and if it is not possible, then hire someone. If you look at dailywine.co.za from the outside, you would think it is being run by a team of 5-10 people, where in reality it's much less.
Automation can play a pivotal role in streamlining operations and reducing the need for exceptional talent.
By acknowledging the reality and embracing the strengths of regular employees, and automating tasks, entrepreneurs can create businesses that are scalable, efficient, and sustainable.
Entrepreneurship is a challenging journey, and falling into common traps can hinder our progress and success.
By reassessing our priorities, shifting our focus to sustainable businesses, emphasizing the importance of cash flow, and rethinking our approach to hiring, we can avoid these traps and build businesses that are not only financially rewarding but also provide us with the freedom and balance we seek.
Let's embrace a more grounded and practical perspective, finding fulfilment in the incremental successes and the positive impact we create along the way.
Remember, entrepreneurship is not just about building the next sexy startup; it's about building a fulfilling and prosperous life on our own terms.