Ask successful entrepreneurs if, had they known everything they knew now back when they first started, would they continue, and you’d get a good number say no. The road of entrepreneurship is paved in disappointments, heartaches, loneliness and stress. Twenty percent of businesses fail their first year, and 50% do not make it to five years. However, every year more than 1 million new businesses start up. The year 2020 saw a historic 4.4 million businesses open. Although the reasons people open a business vary from job loss to dissatisfaction at their current position and everything in between, here are five hard lessons only seasoned entrepreneurs know.
You Might Make Less Than You Did Working for Someone Else
In my first year of business, I made about half as much as I had working part-time for someone else. I also worked more than twice as hard. Taking into consideration how many hours I worked, I was making less than minimum wage.
I was working between 70 and 80 hours per week. However, I chose to work long hours to get my business up and running. Current laws stipulate that business owners must pay their employees. However, no laws state that the business owner must get paid — actually, quite the opposite. The business owner gets what’s left after all the employees, contractors, vendors, taxes and bills have been paid. Unfortunately, for some, that’s less than they could be making working for someone else. Nevertheless, successful business owners stick it out because they believe their product, internal processes and drive are good enough to overcome these challenges.
Nobody Cares about Your Business as Much as You Do
Hiring your first employee can be a fantastic feeling. As an entrepreneur, you will likely think to yourself, “I am finally on my way.”
The following is a common sequence, however: The entrepreneur’s first hire seems like an excellent fit; they work long hours together and develop a great working relationship. When things feel like they are steady, the entrepreneur may get tempted to relax a bit. Then suddenly, the employee is no longer excited to come into the office, and starts taking off without telling anybody. The employee comes in later and leaves earlier than everyone else. Inevitably, what happens is some considerable oversight is made, and the company loses a big client. Racing to retrace what went wrong, the entrepreneur discovers the employee did not follow steps, did not make customer service a priority, or simply was careless. In an effort to fix the scenario, the employee quits. As the entrepreneur, you’re back to being on your own.
It’s a lonely and rough road when you are in charge. Sometimes, you have to learn tough lessons to avoid making even more mistakes. That’s why it’s a good idea to start with clear expectations of job duties, incentive structures and the company’s mission. However, at the end of the day, you’re all on your own.
You Are Never ‘Not Working’
Many business owners have insomnia from long nights thinking about their business. When they are working, they wish they were enjoying their lives more; however, they feel guilty about not working when do they take a break.
Many successful business coaches will tell you that business success is only 20% skill. Therefore, the majority of what it takes to make a business a success is in your mind. That’s why many successful business owners spend their free time working on themselves, which essentially is still working on their business.
You Can’t Do Everything
If you want something done right, you have to do it yourself. That’s what many business owners say after they’ve tried delegating tasks, to have it come back all wrong and then have to spend extra time training and monitoring the progress of the person they’ve delegated it to. This can seem like the person they’ve hired to help them is actually making their lives more difficult.
Sure, it can be easier just to do it yourself. However, that’s not scalable. This is the critical point where businesses decide if they will grow or shrink. Since there are many responsibilities in running a business, it will take some time to hire and train new employees and also make sure they are doing the job correctly. The hard work starts before you even hire the employee; that’s why it’s ideal to have a process map of your duties as you go along so that when the new hire starts, you’ve got a handbook that will assist you and them in making sure the job gets done correctly, the first time.
Having Too Much Business Can Be Just as Bad as Not Having Enough Business
Whenever I tell people that I have more business than I can hire for, the answer that comes back is always, “That’s a great problem to have.” While that might sound like a great problem to have, we’ve got to take a look at what can — and usually does — go wrong in these situations:
- The job market is bad right now; drive by any street, and you’ll see countless “help wanted” signs. Companies are so desperate to hire right now that they are offering thousands of dollars in cash bonuses for entry-level fast-food workers.
- Your quality could suffer; it’s the difference between quality and quantity. It’s hard to perform quality control when you’re growing too quickly.
- Your customers could get angry. You could have 100 satisfied customers, and that one who didn’t get something right will be the one that goes on Yelp to complain. Go figure!
These are the five hard lessons that most business owners learn while navigating their business. While you can’t always avoid them, preparing for them will help you overcome them with greater ease.
Jennifer Charles, Ph.D., is the inventor of the Boosting Healthy Habits app and owner of Building Block Resolutions. Her company provides therapy for children with autism, parent coaching, and crisis management for business.