What does it really take to be an entrepreneur, to run your own business? In The Entrepreneur Equation – a book by Carol Roth – the author believes one must ask five basic questions before taking the plunge into business ownership. These questions are tough, but must be answered prior to starting down the home business or small business owner’s path.
In Roth’s opinion, the questions – all carrying equal value – are as follows:
1) Why a business? What is your motivation? Wanting to make lots of money is not a recipe for success. Having a passion for producing a great product or service for your customers is the key to success. Before you start a business make sure that your motivation is the right one.
2) Do you have the right personality to be an owner? Many people can be successful managers, but be terrible owners. Owners need a unique balance of passion, resourcefulness, desire, and tough skin.
3) What is the business opportunity? Many, many ways to make money are possible. You can build a new Twitter or LinkedIn, buy a franchise or an existing business or consult. Understanding the opportunity is key to knowing the workings of your entrepreneurial streak. If you want to be successful, don’t just pick any random business to buy or start. Research and review the opportunity, discuss with industry peers, and select one (or more) that give the best chance for success. Make sure your personality and motivation blend well with the opportunity.
4) Is the time right? Timing has many considerations: family obligations, personal health and welfare, financial, market niche and macro-economic factors. Now would probably not be the best time to start a “pet rock” business if you have little spare cash and a new baby on the way. Timing is as important as opportunity.
5) Consider Risk and Reward – An entrepreneur has an opportunity to make large rewards on risks taken. The opposite is also true. Do you have adequate resources to cover the economic downturns? Do you have a personality that can handle temporary or even complete failure?
Before you decide to “stick it to the man” ask yourself these five questions that could mean success or failure. If you can’t answer them well, perhaps life in a cubicle is not a bad thing for a while. You can always start something smaller on the side and test your entrepreneurial aptitude.
By Dion D Shaw
Dion D Shaw is the founder and owner of Homepreneurs
Homepreneurs. New Day. New Opportunities.
Homepreneurs does not endorse nor have any relationships with any of the services listed. Homepreneurs receives no compensation or consideration for its suggestions. Homepreneurs strongly urges all interested parties to conduct research and accepts no responsibility for any losses incurred.
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