Fearless Money

I’m always amazed at how the right information finds me at just the right time. I’m in the process of launching a new business, and today I found an article at entrepreneur.com which addresses 5 (really 6) common myths about starting a business.

Myth #0: 90% fail in 1-2 years

Actually, more than 50% of new businesses last more than four years. Of those that do close, many do so for reasons unrelated to finances, and were actually profitable when they closed their doors. I don’t know about you, but I’d heard that old “90%” statistic one too many times, and it was making me more nervous than I needed to be.

Myth #1: Do What You Love, and the Money Will Follow

It is important, but not everything. In some cases, too much passion is a detriment to doing what is right for your business or your customers.

“What you think you’re going to start out doing can morph on you,” she says. “If it’s not working, pay attention to the opportunities. I’ve seen a lot of people fail because they got rock-headed and wouldn’t pay attention to the opportunities.”

Myth #2: You’ll Miss the Security of a Job

You may miss the illusion, but the fact is that you have no security when working for others. They can and will get rid of you at the very first instant that it is financially advantageous for them to do so. I’ve been absorbing this one for a long while now, and Steve Pavlina finally made it through my thick head when he pointed out that he feels more secure by having multiple streams of income. If one dries up, he still has the majority of his income, instead of the typical employee situation where 100% of your income comes from just one source.

Myth #3: If You Don’t Grow, You’ll Die

Businesses can be both profitable and stable without having to become world dominating. It makes sense once you take a moment to think about it. Most companies are fairly stable in size after an initial growth ramp, actually.

Myth #4: If It’s Such a Good Idea, Somebody Would Have Thought of It Already

Maybe, or maybe you can do it better. Possibly you could take a proven Microsoft tactic and win by better marketing. Most small businesses are terrible at marketing.

Myth #5: You Can’t Start a Business Without a Lot of Money

Not true in reality. According to the article:

The average entrepreneur starting a one-person business plans to get underway with about $6,000, according to a 2003 SBA study. Businesses that involve teams of founders shoot a little higher, aiming for $20,000 in startup capital. While that’s not peanuts, it flies in the face of the common perception that it takes a great deal of money to start a business.

Link found via Business Opportunities Blog

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