Starting your own business is always risky. You could copy step-for-step the actions of a successful enterprise and still fail to make it to your second year. If you have suffered an entrepreneurial disappointment, it might help to remember that over 50 percent of small businesses go under before their fifth anniversary. Not every business idea is a home run — or even a base hit.
However, just because your first attempt went bust doesn’t mean you should. In fact, you should take the time after your first entrepreneurial experience to gain more knowledge and skill, learn from your mistakes, gather better resources and talent, and prepare for your next business. Here are some tips to make your entrepreneurial offseason productive, so you can hit your second business attempt out of the park.
Reject Blame and Shame
It is normal to feel upset after your first business folds. Though the economy might not have been ideal, your business partner stubborn, or maybe your family might have been less than supportive, ultimately you failed to plan for this business environment and react appropriately to obstacles. You shouldn’t blame anyone or anything else but yourself.
Still, that doesn’t mean your blame should transition into shame. Most entrepreneurs experience business failures, so you should banish feelings of humiliation or disgrace. You should allow yourself a few weeks or months of disconsolation — while working as an employee, unless you can afford a period of no income — before jumping back into entrepreneurship.
Evaluate First Business Mistakes
Before you can truly move on from your initial failure, you must understand what went wrong. Although it will be painful, you must dive into your first business to find all your mistakes. Then, you should spend time analyzing these mistakes to parse what actions you should avoid in future ventures. This process requires both diligence and enthusiasm, so you should only begin when you are ready to resume your entrepreneurial dreams.
There is no aspect of your failed business that you should leave unanalyzed. You might believe you know why your business failed, but by fully evaluating the efficacy of your past business decisions, you might be find other mistakes you were unaware of. Cash-flow management, marketing strategy, customer service, and more should come under your microscope, so you can become a better entrepreneur in the future.
Consider Business School
If you are struggling to identify the precise causes of your previous failures or you aren’t certain how you could have made better decisions, you might not have the foundational business sense necessary to be a successful entrepreneur — yet. Even if you do recognize what went wrong last time, you should probably consider returning to school to gain the knowledge and skills entrepreneurs need to lead their startups to success.
Business school doesn’t have to consume your life or delay your entrepreneurial dreams. You can obtain an online MBA for less expense and more flexibility, allowing you to focus on further developing your business ideas and strategies. Plus, an MBA provides you with a career parachute: If you ultimately decide entrepreneurship isn’t for you, you can fall back on your education credentials to get you a high-paying job at someone else’s business.
Ask for Help
No entrepreneur is an island. During your education and work experience, you should be building up a network of professionals who can help you reach business success. If your sole proprietorship failed, you might consider asking a trustworthy member of your network to become your business partner; if your bootstrapping failed, you might seek out a contact in the financial services industry to help you acquire manageable loans. It isn’t shameful to ask for help — but it is reprehensible to deny help and fail.
Find Passion and Commitment
It isn’t necessary that you are in love with your business idea — but it is exceedingly beneficial. If you are passionate about what you do, you will be more motivated to put in hard work, make good decisions, and succeed. You shouldn’t be misled: Work will always feel like work. However, when you love what you do, the work will feel worthwhile.
Conversely, you absolutely must be committed to your business. If you feel you cannot devote your entire attention to your venture, you should put off opening your doors until your other responsibilities have waned. Your business deserves everything you can give — which should be absolutely everything the second time around.
- How to Deal with Business Failure
- Starting a Business You Know Nothing About
- Do You Have What It Takes to Succeed as an Entrepreneur?
- Passion: Critical Element of Business Success
- How Entrepreneurs Think