BE BRUTALLY HONEST WHEN IT COMES TO YOUR BUSINESS NEEDS VS WANTS
Starting a new business is exhilarating.
That combination of new ideas and the unknown create a unique environment that only entrepreneurs can truly appreciate.
Having successfully AND unsuccessfully built a few companies I’ve come to appreciate that the major differentiator between the two is directly tied to how the business owner invests his/her time and money. Below are a few questions that I typically ask myself before investing either in any meaningful way.
What is my time worth? If you are a small business owner your answer will be different than someone already running a larger company but the exercise is the same.
Is this activity going to generate revenue today? This should be a YES 80% of the time.
Is this activity worth my time and focus?
Can I outsource this activity, or do I personally need to do it?
How will I measure my return on investment when I purchase this product/service?
Do I need OR just want this product/service?
What am I missing out on/potential consequences of me not taking action on this product/service?
Aside from the purchase price/ongoing service contract what other expenses should I anticipate?
Is there a more cost-effective solution?
Is it urgent or can it wait?
Several years ago my partner and I purchased a CRM database system. It seemed like a fantastic idea. The sales demonstration showed us how we could streamline our business between all departments and create snap shot reports in real time.
Excited at the possibility of having all these features at our fingertips we sign on the dotted line and promptly began spending…I mean “investing” our time and money into this platform. In hindsight, all we needed at the time was a basic database to keep track of prospects and clients.
Everything else would have been nice to have but certainly wasn’t required or even permanent as we were growing and evolving.
100s of hours and 10s of thousand dollars later the project was scraped as it no longer made sense to proceed.
When I connect with entrepreneurs nowadays, I realize that we weren’t alone. Starting a business is tough and despite your best efforts you will make mistakes.
Lots of start-ups go broke before they can get the business off the ground because they don’t make the best of the time and money they do have available.
Before you dive into your next project or sign on the dotted line consider asking yourself some of the questions above.
To Your Success,
Marcin has been instrumental in building several businesses including commercial & multi family real estate investment partnerships, a consulting practice and a smart home security business serving customers nationwide. Marcin has secured over $100MM in growth capital for various businesses and has collectively spoken in front of thousands of entrepreneurs, business owners, investors and those just starting to explore living life on their own terms. Outside the office Marcin can be found at the gym lifting heavy things, skiing or on the road zipping along on an extended bicycle ride.
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