Running a company, big or small, with or without funding, can be both the best and longest months/years of your life. It can give you the utmost joy that fills your entire day, or the heart-sinking anxiety that will have you restless all night.
In this blog post, I’m sharing my experience running small companies (I’ve done it a few times) from both a successful and a non-successful perspective. You’ll learn about, what I believe, makes going out on your own successful and what mistakes you can make along the way.
Loving What You Do
Figuring out what you want to do, and more importantly, what you’ll love to do for the rest of your life is hard (I still don’t fully understand how we expect 17-year-olds to choose what they want to go to college for). When you come across something that you think you may enjoy or even love, go for it. The feeling comes in very few people’s lives.
When you love what you do, or enjoy it, a lot of people are willing to risk everything. Homes, livelihood, thousands of dollars in savings, and many other assets. What I will say is risking money or living as comfortably as you’ve been is sometimes alright, as long as everyone is doing their job to make the business flourish.
Finding that “one thing” that’ll make you say I don’t need a vacation this summer or I’m alright living with the minimum is groundbreaking to our minds. We leave behind the materialistic needs and move forward with internal happiness.
When you do what you love, there are a few mistakes you can make. The three biggest mistakes are:
- Not having enough money in the bank to keep you afloat if things go south
- Having universal trust in others
- Not lining up your goals
In terms of not having enough money, what I recommend for everyone who is going out on their own is:
- Have money in the bank
- See who else is bringing money into your home (perhaps your spouse)
- What bills you can cut out each month
When I first started doing my own thing, I cut out about $500-$600 dollars per month. This doesn’t sound like a lot, but boy.. it saved my bacon a few times.
When you love what you do, you can also be a bit blinded to what’s happening around you. Trusting people is important, but trusting your gut can be even more important. You’ll learn more about this in the Trust And Betrayal section.
Finally, there are your goals. When you’re thinking about your freelancing or company goals, you must ensure to think about your life goals as well. Otherwise, you’re going to find yourself not having the ability to do anything except think about and do work. It’s not a fun life to live and you lose people in the process.
Growing An Idea
Taking an idea that’s in your head and scaling it out to be profitable isn’t an easy task. Scaling out an idea to make it a profitable amount that you can live on or perhaps make a lot of money from is ridiculously hard.
It’s really difficult to come up with an idea that no one else is doing, but it’s not impossible.
One of the biggest mistakes that engineers make (I’ve made it several times) is that they think to themselves I’m a good engineer and this is a great idea, people will buy it.
This is almost never the case. It doesn’t matter how good an idea is or how much it can help people. The only thing that matters is who knows about it. Every engineer growing an idea must know marketing. It’s not an option.
Let’s think about a product for example – the leggings that everyone seems to be wearing that have the ripples in them (at least in the US). I know for a fact that those leggings are cheap, horrible material, and rip easily. Yet, everyone is buying them.
Because of good marketing. All of the marketing around the leggings is showing how they can make anyone’s butt look awesome. Who wouldn’t want that?
In short, you can grow an idea and sell it. Whether it’s a good idea or a “not so great” product. The reason why either of these can be successful is because of good marketing.
If you want to grow an idea, think about marketing. It should be just as important as the engineering that goes behind building the product.
Keeping Your Head Up
When you grow an idea and love what you do, you will hit bumps in the road. It’s inevitable that things will go south. It could be going good for months and then boom, the next month you make almost zero dollars. A lot of people start freaking out at this stage.
Oh, I made zero dollars this month. The product obviously sucks.
This isn’t true. It could be a lot of things:
- You weren’t marketing as hard
- You weren’t selling as hard
- You lost interest in what you were building
It could also be plenty of things that you didn’t do wrong:
- Holidays or summer months tend to slow down the sales cycle
- Global pandemics can have people scared to spend money
Here’s something else to keep in mind – you could have a bad month and never find out why. Everything in your workflow could be flush, products are good, marketing is great, yet it’s not a good month.
That’s okay. This is going to happen. At this stage, you must keep your head up.
I can guarantee you’ll lose sleep. I bet you’ll eat crappy food to make yourself feel better. You’ll sleep as much as possible because you’re depressed.
However, all of those things can be avoided if you keep a few things in mind:
- It’s really hard to make zero dollars. There are so many opportunities to make money, whether it’s part-time at a retail store or freelancing.
- The downfall won’t be forever. Everyone has bad luck. If you keep moving forward and don’t let the negative thoughts consume you, you’ll make it.
- The tech market is booming right now. Even if you can’t keep your business going, you can go get a full-time job or get a contract.
There are always options to make the bad days less bad. I’ve been there before and it took me a while to learn how to not let the negative thoughts consume me. In fact, I still have negative thoughts. I just have less of them and know how to control them.
Trust And Betrayal
Running a business where you’re selling a product is hard by yourself. More importantly, it’s hard to get people to buy it, see it, or talk about it. There’s a lot you need to do:
- Market the product
- Sell the product
- Spend time on outreach about the product
- Get the product in front of the right people
And before all of that, you have to build the product… and even when the product is built, you still have to maintain it.
That’s really hard to do by yourself unless you want to work 80 hours per week. I’m not a fan of the hustle culture (although, everyone has to be a hustler), so I don’t recommend this. What I do recommend is one of two things:
- Start small and go slow. If it takes you five years to get something off the ground because you’re moving slow and still working full-time, that’s fine.
- Get a business partner, which should be someone you have trust in.
Moving a product slowly has its pros and cons. The biggest con is you could be too late to the party and someone else comes up with something similar. This isn’t always a huge deal because as I’m sure you know, there are a ton of the same things out there, yet people are still making money off of them.
Another way to think about moving the product slow is if you have a lifestyle business. A lifestyle business isn’t supposed to make you rich or have you quit your job to pursue it. It’s really just a hobby that you got good at and decided to make money from. For example, maybe you know someone that’s really good at baking and they were asked to make a cake for a birthday party. Boom. Lifestyle business.
If you go the business partner route, this can be tricky. A business partner should be one of the people you trust the most in the world, but you have to ensure you have all of your ducks in a row. Otherwise, someone can easily take everything away from you and not bat an eye.
When having a business partner, ensure to have a few things lined up:
- The proper legal paperwork and documentation. If it’s supposed to be 50/50, ensure that’s written and signed.
- If you’re starting an LLC, ensure both of you are on it.
- Be friendly with your business partner, but also ensure they know you mean business. It sounds like this could be “mean”, but believe me when I tell you that it can save you in the end.
- Ensure both of you are truly running the organization. If one person is making all of the decisions, this can burn you. It must be equal. Otherwise, they can kick you out (if the proper legal docs aren’t signed) before you know it’s happening.
The idea with a business partner is this:
- Make sure everything is legally documented and signed.
- Trust your gut
Trusting your gut is probably one of the most important things. You could have a “feeling” for months that you don’t exactly “know” what’s happening, but your gut is telling you that something isn’t right. You’ll be inclined to not trust your gut and instead trust your business partner, especially if you’re friends, and that decision can make things go very good or very bad.
Trust your gut.
Once you have all of the things I mentioned above figured out, you should be in pretty good shape. Of course, that’s not everything and perhaps another blog post will arise from this one, but it’s a good starting point.
I’ll leave you with two things, which are tough to realize, but very relevant in the business world.
- You don’t owe anyone anything
- No one owes you anything
It’s sort of a narcissistic mindset and I get it, but sometimes you have to think about the way the world works and more importantly, how people work.