The eight lessons learned from running my own business
Knowing what to focus on in the early years of building your company is interesting in hindsight, but even more useful if you can gainthatinsight at the beginning.
I’m the CEO and co-founder of FreeAgent, a company which provides a cloud accounting software for freelancers, contractors, micro-business owners and their accountants.
Since setting up FreeAgent in 2007, I have sought and secured more than 7m in external investment, from backers in both the UK and US including a first round of equity crowdfunding, which successfully raised over 1m.
My two co-founders and I bootstrapped? FreeAgent for the first two years before looking for financial funding, and experienced the considerable challenges involved with getting a business off the ground and growing it during challenging times. Here. I’d like to share some of the biggest business lessons learned throughout the FreeAgent journey.
The world is full of great potential business ideas, dreamt up over lunch with friends or a few pints down the pub. However, there are far fewer actual businesses, because for one reason or another those potential entrepreneurs never summoned up the courage to take the first actual step.
Some entrepreneurs liken that step to jumping off a cliff with a kit of aeroplane parts and assembling it before you hit the sea. Luckily it’s normally less dramatic than that, and the consequences for failure less terminal, but nevertheless you do have to commit fully from day one. Be brave and start your journey – you never know where youll end up.
Be a painkiller, not a vitamin
Your product or service is very unlikely to succeed if it’s just something that’s nice-to-have, or that’s perceived as an optional extra. Unless you’re really removing a painful problem in someone’s life, they’re unlikely to reach for their credit card or hand over hard-earned cash.
Also, make sure you take a good look at what you’re actually offering to potential customers and be prepared to use their feedback to tweak your product or service to better suit them. You may think you’re solving a problem for them, but the reality may actually be quite different.
Your market is probably not “all the consumers in the world”, or even if it is you don’t have the resources to pursue it properly. it’s better to find a smaller market that you can serve exceptionally well, and start from there rather than spreading yourself too thin. Remember you can always try to branch out and expand once your business is established.
don’t run out of cash!
This may sound obvious, but it actually happens surprisingly often. Many new businesses fail because they havent budgeted enough money to achieve their vision, or because theyve let costs spiral out of control.
Considering it’s the only thing that’s truly going to kill your business, it’s vital you are disciplined enough to know where all the money is going and what your realistic plan is for becoming profitable. It’s a lesson learned often too late.
As part of Business Advice's commitment to bring you lessons from the nation's most successful business builders, we hear from entrepreneur-turned-investor Richard Reed on the keys to early survival and managing cash flow. more»
Having pestered Pret a Manger founder Julian Metcalfe for months trying to get him to buy his product, Robert JakobI is well-placed to share advice on getting to the top and disrupting to stay there. He shared his tips with Business Advice. more»