Do you have what it takes to be an entrepreneur?

Every year, thousands of Canadians respond to the call of entrepreneurism.  Fresh college graduates, mature executives, parents who are raising children at home and new immigrants are part of this growing force of independent business people.

The majority of these people have no experience in buying a business.

Not everyone is cut out to be an entrepreneur and it is better to find out now rather than later.  Many people romanticize about going into business and believe they could run the show.  But when the time comes to cash in their equity, mortgage their home, and write a cheque for a relatively large investment, their confidence often disappears.  It is not unusual for first-time buyers to lose confidence in themselves at any stage of the buying process, particularly in the final stages of closing.  Before you go any further, ask yourself:

  • Should I even consider buying a business?
  • Am I doing this for the right reasons?
  • Do I have realistic expectations?

Although it is important to be optimistic, you must also have realistic expectations.  Do not go into this with blinkers on by overestimating the potential rewards and overlooking the demands of running your own business.  It is possible that you will earn far less from a business than you think and find yourself working a lot harder than you have ever done before.  Realistic buyers understand that the rewards are achievable, but for a price.

To give one example, consider family support.

If you think that going into business for yourself will allow you to spend more time with your family, then you should reconsider your decision.  Buying a business and running it during the first couple of years can place a real strain on your marriage because of the time and emotional commitment.  If you are going into business for yourself, it is critical to have the support of your family.  It is extremely important to discuss everything openly with your spouse as once you have purchased the business financial concerns and lifestyle changes become a family affair wither you like it or not.  Your spouse may have different goals and a lower tolerance for risk than you.  The following guidelines should help in this area:

  • Explain to your spouse your reasons for wanting to go into business.
  • If your spouse has any objections, try to zero in on exactly what the objections are.
  • Don’t try to overcome your spouse’s objections until you are sure you fully understand them.  Your spouse may actually share some of your concerns but these concerns may be a bigger obstacle for your spouse.
  • Be prepared for some give and take in a few areas, for example, the level of financial risk or the amount of time you wish to commit to the business.
  • Invite your spouse to participate in the search and negotiation process.  Have your spouse attend and participate in meetings with lenders and professional advisors.
  • Seriously consider if you have the full support of your family and ask yourself what pressure will this place on your relationship before you proceed.

Of course, there are many other examples of prices you’ll have to pay, and we’ve just listed one of them.  Consider the financial risks, the emotional and stress fatigue, the loss of personal time, the need to hire, the decision making that will come along the way and much more.

Hopefully our new blog will guide you through it all with our weekly business tips, so stay tuned for more expert advice from Central Park Business Centre, where helping your business succeed is our mission!