#MoneyChat Biz Series: Startup Reality!

Hey #MoneyChat FAM! I hope you all are doing well... I'm confined to my couch with Theraflu and a box of tissues... the Detroit winter has been so mild, some of us (ME) forgot it was indeed... WINTER!  I wanted to make sure I posted this recap of Monday's chat that kicked off our Biz Series. Check it out, share it with your friends and JOIN US for #MoneyChat every Monday night 8-9p. ET! 

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As a business coach, I work with a lot of people who are looking to leave their jobs eventually and start their own business. Part of helping them do that is also making sure they have a realistic view of what it will truly take.....

Dreaming.... 

... of sleeping in, long vacations, and loads of dough? WAKE UP! Entrepreneurship is hard work. You may get tired of hearing people say make sure you choose a business you will love, that you are passionate about, but it's the best advice ever. When the days get long, when you have to pay everyone but yourself, when you have not had a vacation in several years - you will NEED that love and passion. 

Paperwork...

One poster said she had friends who had started businesses and were using names that weren't registered. That's a waste of energy and demonstrates a lack of seriousness about your business. Why go through the trouble of building a brand, getting postcards, business cards, etc. and your name isn't registered? Someone else could legitimately use the same name because they took the time to get their paperwork in order. Take care of your paperwork, your taxes, keep your books in order from the start.

A 40 Page Business Plan? Uh.. NO!

I've had a couple of side businesses.. sold jewelry, candles, cleaned houses. It wasn't until I started Conner Coaching that I felt I needed a massive business plan. So I spent six long, grueling months creating a beautiful plan, complete with charts! ( I heart charts) Only to have to revamp it to a smaller, workable version soon after! 

Don't get me wrong - you definitely need a business plan, but think of it as a 2-5 pager that includes:

1. Vision - (don't get too deep here, what do you see for your company in one paragraph)
2. Operations/Team
3. Marketing Plan/Target Market
4. Financial Plan (startup costs, 3 year forecast, expected cash flow)

When do you need a major business plan? When you are seeking multi-million dollar bank deals, VC (Venture Capital) funding (maybe) or participating in a business plan or other entrepreneurship competition.

Marketing...

Many entrepreneurs believe that their marketing begins and ends with social media. While social media is a great tool, it's not supposed to be your only one. You have to allocate some money toward marketing. Initially this may include your expenses for business cards, website, flyers, etc. You will want to allocate money for advertisements that make sense for your business. (Ex: If you have a trucking business, don't place an during a political talk show)

Research your market before you spend a lot of money on useless ads, be focused and intentional so you can bring in customers, sell more products. Pick your top 5 advertising methods. For example - 2 of my top 5 are Social Media and Speaking. I've built a community online and speaking almost always generates clients. 

One of my favorite marketing authors is Jay Conrad Levinson  and his Startup Guide To Guerilla Marketing, I recommend this book to my clients. 

A last tidbit...

One of the main keys in starting a business is being disciplined in your personal finances. You will likely have to invest personal money to get started, if you don't know what you have, you will be in trouble. Also, your personal finance habits, translate into how you manage your business finances.

Join us next Monday's topic - Business Conferences! How to make the most of them and actually walk away with client prospects, media attention and new friends!

How did you start your first business? Are you getting started now and have more questions? Post them below!

-Dorethia

Should You Be Out of Debt Before Starting a Business?

I am asked this question a lot when I'm speaking or coaching clients. Many people have entrepreneurial dreams, but aren't sure how this fits in with getting their personal finances in order.

The answer is NO, you do not have to be out of debt to start your business. (As a side, no you do not have to be out of debt before you get married either. I get this one a lot too!)  Anyway, moving right along,  here are a few financial things to consider before you jump into the world of being your own boss....

Have You Mastered Your Money? 
If you think handling the family money is a pain, wait until you start a business! You must have a process in place and some discipline in handling your personal finances in order to be able to successfully manage your business income and expenses as well.

Can You Answer YES to These Questions?

• You complete a budget each pay period and you know where your money goes
• You write transactions in your checkbook when they occur or at least by the end of the day
• You balance your checkbook to your bank statement when it arrives (or online)
• You've reigned in unnecessary spending
• You do have a plan for paying off your personal debts 

Personal Emergency Fund

I do suggest having at least your partial emergency fund of $1,000 saved.

Saving For Your Business

First, complete a 'Startup Expenses' form. You can  find one here: http://www.score.org/ .
List everything you will need to start up and the cost associated. Then, look at your personal budget and calculate how much can be allocated toward saving for your business each pay.
Essentially, you will add a line in your budget for let's say  'Dave's Detailing'  and assign it a dollar amount. Be disciplined about setting that money aside.

Stay away from debt... I'm the poster girl for the bootstrapper. Bootstrapping allows you complete freedom, no one gets a piece of the pie but you because you didn't borrow money!

So off you go... get busy ... live your dream, start your business, just plan it out!!

Need some motivation? Check Out These Tunes!

McFadden & Whitehead - Ain't No Stoppin' Us Now
Survivor - Eye of The Tiger
Ben Harper - My Own Two Hands


Your Financial Coach,
~Dorethia
http://www.connercoaching.com/