More and more women are launching a business today, than any other time in history! Women are starting businesses for many reasons, but here’s just a few:
- They want to build a second income and increase family stability
- They want more freedom and the ability to create their own hours
- They want to be able to stay home with their family
- They have an idea that they want to bring to the world
But often women are starting these businesses on a shoestring budget – and making a lot of mistakes in the process. So, if you’re considering starting a business, or you just started a business, here are some of my top mistakes to avoid in starting your new business!
Know exactly who you will serve, what you will offer, and why it matters!So often, I have a client come to me and say, “I want to ____.” (Insert anything you want.) Then I ask them who they want to sell it to, and how it will improve their clients’ lives, and they look at me like I grew three heads.
I’m going to give you a bit of really tough love here. No one cares what you want to sell or what you want to do. They care if it will help them achieve what they want to achieve! For example, you may want to teach women to sew. There is absolutely a population that wants to learn that! There is absolutely a market for that service. But it isn’t everyone!
I once had a client come to me and say that she had just decided to launch a new service. She was SO excited about this new service. She had gone and created the sales page and all the emails and was already sending it out to her email list, just a few days after even coming up with the idea.
But when she called me, she was stumped. No one had purchased, and she had over 10% of her email list unsubscribe. She had been SOOOOOO excited about this program!
As we started to talk through it, it became clear that she had been so excited that she skipped a few of the necessary steps.
First, she hadn’t really thought through the benefits of the program and who is was most going to help. So her sales copy wasn’t getting people to take action.
But second, and really way more important, she hadn’t thought through WHO was going to best be served by the program. She was sending out this program and bombarding her email list with this offer to “buy my program, buy my program.” But this program didn’t apply to over 75% of her email list! Imagine sending an email out every single day that says, “buy diapers” – but you’re sending it to a bunch of 22 year old single ladies who are more interested in meeting at the wine bar. Of course you’re going to annoy people and have them unsubscribe. It makes them feel like you don’t know them. It makes them feel like you don’t care anything about them – only that you want to sell something to them! So before you start pitching a product or service, know who you’re pitching it to, and why they would want it!
Do the legal work
I am AMAZED at how many people launch businesses and never hired an attorney, never looked at legal requirements and never create any terms and conditions in their business. Unfortunately living in 2019 and beyond, we live in a very litigious world! Even the people you trust most can come back and cause problems! You can’t protect against everything, but there are a few minimum things to consider.
- Do you need an entity to protect you from liability? We have LLC’s for our businesses to keep our businesses separate from our personal life.
- If you have an entity, did you get a federal and state tax id number?
- Do you have employees, where you need a federal and state employer number?
- Do you need a business license?
- Do you have terms and conditions for your products and services? If not – then if a dispute arises, you have no leg to stand on.
- Do you have employment contracts?
- Are you paying the minimum wage?
- Do you have privacy policies? And are you following them?
I know it’s tempting to skip the legal stuff. It isn’t glamorous, and it seems like a waste of money or a waste of time when you first start out. But it is NOT a place to skimp when starting your business!
Bigger Is Not Always Better
I want to challenge you to consider that bigger is not always better! Despite spending 15 years in finance, I experienced this first hand. I launched one brick and mortar business with a team of 10 in May 2010. I launched a second brick and mortar business with a team of 15 in January 2011. I launched a coaching business in 2013. Over just three years, I had built an UNBELIEVABLE business. But I was traveling all over the place, and I had a TON of expenses. I felt pulled in every which direction, and I was getting close to having a nervous breakdown! I started my business to have more freedom. But I had created a monster! I knew I had to make a change. I started selling portions of the business. Rather than focusing on growth, I started focusing only on what really lit me up – what I really loved, AND what generated the best results! If it didn’t fit in those two boxes, it didn’t fit in my business! One of the things that I preach to women growing businesses is that I want to teach you how to do it – without the hustle. There will be seasons in your business that you may need to sprint to achieve some big goals. But I believe that most of us launch our businesses because we want more freedom. I believe that you can build a fabulous business that achieves your goals, without working 24/7!
Pay Attention to Profits
We all know that when you start a business, you have to invest something to get started. One of the big struggles I see though is that business owners get into the habit of reinvesting in the business – in coaching, in masterminds, in new technology, in their team, in additional products and services. And once you get on that merry go round, you believe that you have to continually invest in the business for it to grow. By the time I realized I needed to pull back, we were generating almost a million dollars a year, I had rent on two locations, I had a team of almost 30 at the time, including full-time managers, and I was investing between $25k and $50k/year on coaching – all with the goal of business growth. But I was measuring the wrong thing! I was measuring the top income (gross income) versus paying attention to the MAIN thing – NET INCOME (profits). Because I wanted to grow, grow, grow, I kept re-investing almost everything into the business. I’m not saying don’t reinvest in your business. I’m saying, pay yourself first! There’s a great book, Profit First, that I believe should be required reading for all entrepreneurs. It shares the stories of some uber successful entrepreneurs and how they were focusing on growth, to the pure detriment to their business and their life. I am a firm believer that “what you measure improves.” So I encourage you to begin your business focusing on profits, not gross revenues!
Focus On Your One Thing!
As entrepreneurs, we get so excited about all the freedom we have and the ability to do ALL THE THINGS! Some call it Shiny Object Syndrome. I just call it daily life as an entrepreneur. We think we need to be blogging, podcasting, doing videos, on Facebook, Instagram, Snapchat, LinkedIn. We think we need to serve everyone, and any time someone asks for something we don’t provide, we think, “I should go create that.” We think that we should be the one writing all the emails, doing all the social media, handling all the client service, building the website – all of it! Let me tell it to you straight… If you’re trying to do “all the things”, you’re not going to do any of it well, and you’re headed for burn out! One of my mentors really hammered this into me over the past few months. He said that his goal for his business was “Less but better.” I fought it for a few weeks. But one day a couple of weeks ago, I realized I was sitting in front of my computer and I was SO overwhelmed by what to do next. I had this product that needed some attention in our google ads and our facebook ads. I had this product that we were having some issues with the membership site. I had this social media profile that hadn’t gotten any love in a while. And I just didn’t know what to tackle first. My mentor, Todd Herman, said to me last year: Offer one product, through one marketing channel, to one ideal client for one year. Master that. Do it well. Show up in the same place beating the same drum. Then next year, focus on the next thing. There’s a difference between a serial entrepreneur and a simultaneous entrepreneur. For me, when I start to get overwhelmed or confused by all I have going on, I create more busy work to feel like I’m making progress OR I completely shut down. The best way to get derailed in your business is to try to be everything to everyone. Find your one thing. Focus on it. Do it often. And do it well! That is how you will achieve your goals.