Small Business Ownership Readiness Assessment.
Determine how ready you are to start your first small business with this Small Business Ownership Readiness Assessment.
Henry Lopez, host of The How of Business podcast, shares his thoughts and experiences, and the Business Ownership Readiness Assessment tool, to help you determine if you are ready to start your first small business. And it’s not a matter of IF you will start your first business, but when. If you are considering starting your first business, and you want to learn more about what is required to greatly improve your probability of success, and you want to determine how ready you are to start your business, then this episode is for you.
FREE DOWNLOAD: Business Ownership Readiness Assessment
Small Business Ownership Readiness Assessment – topics and questions covered in this episode of The How of Business podcast:
- Why do you want to start a business, and do you have a clear purpose? Are you currently ready, willing and able to focus on starting a new business? Do you have the personal characteristics of other successful business owners and entrepreneurs? What knowledge do you have about starting a business, and running a successful and profitable small business?
- Henry Lopez, serial entrepreneur and host of The How of Business podcast, helps you answer all of the questions, with the goal helping you self-assess how prepared you are to start your first small business.
- Areas of Readiness: So, What do you need to improve your probability of success with your first business. These are the essential 8 high-level components that I believe are required to be successful as a small business owner…
- Your Why – Your purpose, cause, belief, or vision for your future.
- It’s what gets you through the hard times. Is your personal “why” strong enough to inspire you to make the necessary sacrifices? Is it strong and clear enough to get you through the hard times?
- Everyone has a slightly different and personally unique answer to this question, but typically for most people, it involves the desire for control over their lives and the pursuit of certain freedoms.
- How does your proposed business potentially serve you and your family?
- The Freedoms:
Destiny – having the power to create your own life story
Relationship (includes our clients/customers/patients)
- This “Freedoms” concept was influenced by the article, and other writings, by Dan Sullivan entitled “The 4 Freedoms That Motivate Successful Entrepreneurs”. Dan Sullivan is the founder of Strategic Coach.
- Henry’s why:
Being an Entrepreneur will position me to be able to choose what I do, where I do it, with whom I do it, and for what purpose.
- Readiness Question: My “Why” is crystal clear and creates full energy and clarity for me to move forward with starting my business.
- Mental & Emotional Readiness
- Are you mentally and emotionally ready, and prepared for the challenges of becoming your own boss? You can do it – but you have to prepare for the realities of what it takes.
- I have found that the potential embarrassment of failure is often what holds people back.
- It’s also about perceived risk tolerance.
- Are you just looking for a better job, or are you truly ready to be a business owner? Confusing these two things can lead to lots of issues later.
- Are you prepared to let go of the perceived security of your job and career?
- Readiness Question: I have thought a lot about the possibility of failure and have a clear and concise fallback plan. I have discussed this with my family.
- Are you willing to put in the effort and energy, and delay immediate gratification?
- Do you have the work ethic and dedication?
- Does your health allow for the effort required?
- This will probably be harder than your current job. It will certainly require more mental focus and attention – you don’t just check out on Fridays!
- Readiness Question: I have given a lot of thought to the effort required to launch a business and I am in a position to do whatever it takes to start it.
- Are you willing to put in the time, and make the necessary sacrifices?
- This may include not being to spend time with friends and even family.
- This means perhaps cutting back on or temporarily eliminating hobbies.
- What are you willing to give up or put on hold?
- Felix Dennis: The late Felix Dennis, author of “How to Get Rich” and other books, put it this way when sharing his thoughts on the type of people who become rich: “…a capacity to work so hard that your best friends mock you, your loved one’s despair and the rest of your acquaintances watch furtively from the sidelines, half in awe and half in contempt.”
- During the start-up phase of your business (from development through the initial stages of your business), it will require lots of dedicated time and effort. Then over time, once you have the business running smoothly and you are profitable, you can expect to possibly step back from the day-to-day responsibilities.
- Readiness Question: I am in a unique position in my life to devote the time necessary to launch my business. I am ready to make the necessary sacrifices.
- Do you have the resources to start a business now? It does require some money, and if you are going to borrow any money it will require creditworthiness.
- How will you pay your personal expenses while you work on starting the business? Can you keep your day job?
- Do you have enough for Working Capital?
- Where will the money come from: Your money, friends & family, partners, investors, lenders.
- If required, are you willing to start small and grow through bootstrapping?
- Readiness Question: I have developed a business & financial plan for my business idea, and have access to the capital needed to start and run my business.
- Personal Characteristics
- Are entrepreneurs born or made, or both?
- Common traits and characteristics of other successful business owners (primary, there are others):
- Courageous & Confident
- Work Ethic & Discipline
- Creativity & Flexibility
- Self-Starter & Resourceful
- Long-term Focus
- Persistence and Perseverance
- From Entrepreneurial Leap by Gino Wickman:
- Problem Solver
- Risk Taker
- Responsible (blame no one)
- Readiness Question: I possess most if not all of the characteristics needed to be a successful small business owner, and will continue developing.
- Business Ownership Knowledge
- To increase your likelihood of success with your first business, you need to acquire at least some basic knowledge of business. Of course, there is always a first time for everyone. And not having previous business experience does not mean you can’t be successful. But you will have to be willing to learn and get the help you need.
- And by Knowledge I am referring mostly to Business Operations knowledge – the know how of running a business profitably.
- Ares of ideal knowledge include:
- Business Start-Up (planning, research, preparation, negotiations, etc.)
- Operations Knowledge (Systems, Financial Management, Human Resources, Marketing & Sales, Customer Service, Legal)
- Readiness Question: I have an extensive background in business management, I constantly read and study to keep myself current, and I’m always learning.
- Some of the things you should be saying or thinking, if you are ready to start your first small business include:
- “I have to do this! I will die if I don’t do this!”
- “Others are doing it, why can’t I.”
- “I am confident I can succeed!”
- “I am prepared for failure, but I have a plan to succeed.”
- “I accept the real possibility that I may fail.”
- “I am willing to make sacrifices.”
- “I am scared! I have never done this before and sometimes I am not sure if I can!”
- If you are less proficient or ready in one or two areas, is not as much of a potential challenge as not being ready in multiple or most areas. For example, if you have not no business ownership knowledge, that does not mean you are not ready, you just need to learn and get help.
- A low assessment in a particular area may be addressed through a partnership or perhaps a more structured business model like a franchise.
- It may also indicate that it may be best for you to start smaller, and then grow over time. This is an approach (the MVP approach) and usually recommend anyway.
- Your Why – Your purpose, cause, belief, or vision for your future.
- Business Ownership Readiness Assessment:
- FREE Download: Business Ownership Readiness Assessment
- Help you determine what you need to be ready to start your business, how ready are you now, and if you are not quite ready what do you need to do to get there?
- Assess yourself on 8 key categories of readiness.
- Use this assessment tool over time as you develop your skills and confidence. Use it as a periodic assessment tool for your readiness. It’s your road map of the skills, knowledge, and help you need to get before you start your first business.
- This is a tool to help you assess how ready you currently are, and what you need to work on to get ready. It’s your personal scorecard – you don’t have to share it with anyone.
- Key Takeaways:
- Better understand why you want to start your own business.
- Assess if you are ready, willing and able to be your own boss.
- Understand the characteristics of a successful entrepreneur.
- Complete the Business Ownership Readiness Assessment – your roadmap to launching your first small business.
Episode Host: Henry Lopez is a serial entrepreneur, small business coach, and the host of this episode of The How of Business podcast show – dedicated to helping you start, run and grow your small business.
Starting Your Business – Are You Ready? – the online self-paced video course to help you determine how ready, will and able you are today to start you first small business.
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FREE DOWNLOAD: Business Ownership Readiness Assessment
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The following is a full transcript of this episode. This transcript was produced by an automated system and may contain some typos.
0:00:15.6 HENRY LOPEZ Welcome to this episode of The How of Business podcast. On this episode, I’m going to share my thoughts and experiences and the business ownership readiness assessment tool to help you determine if you are ready to start your first small business, and it’s not a matter of if you will start your first small business, but when… So if you are considering starting your first business and you want to learn more about what is required to greatly improve your probability of success, and you want to determine how ready you are to start your business, the NIST episode is for you to receive more information about the how a business, including the show notes page for this episode and how you can continue supporting my show and receive exclusive content and discounts through a patron membership. Please visit the houses dot com. In addition to my podcast at the holiness dot com, you are also going to find resources and tools to help you start running, grow your small business, including free downloads, trusted service partners for your small business, upcoming workshops, online self-paced learning programs, and much more. So the question is that we need to ask ourselves to determine if we are ready, our questions like, Why do you want to start a business? And do you have a clear purpose, are you currently ready, willing and able to focus on starting a new business? Do you have the personal characteristics of other successful business owners and entrepreneurs, what knowledge do you have about the starting process of starting a business end of the ongoing running and operations of a successful profitable small business…
0:01:54.3 HENRY LOPEZ I hope to help you answer most, if not all of these questions, with the goal of helping you self-assess how prepared you are to start your first business now, and if you’re not ready now, what do you need to either get help in or develop some knowledge of… Or get some experience on so that you will be ready to have a higher likelihood of success with your first small business, so I break this down into areas of readiness, what do you need to improve so that you have a higher probability of success with that first business, there are, in my opinion, these essential eight high level components that I think are required to be successful as a small business owner, so let’s break those down and walk through them. First is your why, your purpose, your cause, your belief or vision for the future and how this business idea is going to play into that. It’s what’s going to get you through the hard times, and there will be hard times, is your personal why, strong enough to inspire you to make the necessary sacrifices that are going to be required is as strong and clear enough to get you through those hard times.
0:03:10.0 HENRY LOPEZ Those sleepless nights. That’s the question you have to answer. Everyone has a slightly different and personally unique answer to this question, but typically for most people, it involves the desire for control over their lives and the pursuit of certain freedoms, how does your proposed business potentially serve you and your family and your pursuit of those freedoms and typically, most people have one or more, if not all of these desires for these freedoms, they are destiny, having the power, the ability, the freedom to create your own life story, location, the flexibility to live for the most part, where we want to live, relationships getting to choose who we have a relationship with, and I share that not just from a business perspective, although that is important, but also who we want to be in business with, what customers and clients or patients do we want to serve as business owners? We should have the ability to choose that to a great extent, purpose is another freedom, what is your purpose? What you want to achieve through or in part because of this business freedom of time is of course a huge one, that was a huge motivator for me personally, is to have control over my time.
0:04:29.5 HENRY LOPEZ I really struggled when I was in the corporate world with being told You have X number of weeks of vacation, that was always something that rubbed me the wrong way, personally for me, I wanted more freedom of time, more control over him, and of course money. Money facilitates a lot of things in our society, so the freedom of being able to make as much money as we want, certainly as we need, and then as much as we want, according to our personal definition of that, this freedoms concept was influenced by the article and other writings by Dan Sullivan entitled The four freedoms that motivate successful entrepreneurs. Dan Sullivan is the founder of Strategic Coach. So a little bit more about my why, just to share my personal focus for me, being an entrepreneur, ideally positions me more and more to be able to choose what I do, where I do it, and with whom I do it, and for what purpose. So as an example of that, my ability to have been able to spend and attend just about all of my daughter’s school events when she was in grade school, because I was able to enjoy the benefits of freedom of location in time, to me, those are memories that are invaluable, and I was able to do that.
0:05:46.6 HENRY LOPEZ So that was one of the things that being a business owner provided me, it’s how it satisfied my… Why, my personal why, my business and what I was doing for the most part, was in alignment with that desire. So the question here that take away question here as it relates to your why, which is that first category that you need to assess how ready you are, is this is your why is a crystal clear and creates full energy and clarity for you to move forward with starting your business, the second area of readiness is what I call mental and emotional readiness, are you mentally and emotionally ready and prepared for all of the challenges of becoming your own boss, you can do it, but you have to prepare for the realities of what it takes I have found that the potential embarrassment of failure is often what holds people back, it’s also perhaps a perceived risk tolerance, so the combination of thinking that it might fail, and I’ll be embarrassed to tell my family, my friends, my peers about that, and the perception of risk those two things is what I find holds most people back from moving forward on starting their first business, and so what I help people with on thinking about that and what entrepreneurs don’t do on that is, first of all, we are past the hurdle of caring too much about what other people think, that doesn’t mean I won’t be embarrassed for some period of time if I fail, I don’t enjoy failing, and I’m not proud of it, but I realize that that comes with the whole process of being an entrepreneur is the potential for failure, I know that if I fail, I’ll look my wounds for a period of time and then move on to the next thing.
0:07:37.3 HENRY LOPEZ As far as risk goes, the way that I balance that is I rarely have ever put all my chips in, I rarely take the kind of risk that if that business were to fail, it would devastate me and my family financially, so if you will make sure that you take a risk that’s appropriate for you and your position, financial position at that point in time, then the risk might be a lot more tolerable.
0:08:07.1 HENRY LOPEZ Are you just looking for a better job or are you truly ready to be a business owner? Is another big question you have to ask yourself, confusing these two things, and really I just hate my job, I want a better one, and I think I’ll start a business to solve that, that’s gonna create a lot of issues later on, because it’s not really what you wanted to do so be careful with that. Are you prepared to let go of the perceived security of a job in a career? That’s also a big one. You have to think through. So the readiness question in summary, on this area of mental and emotional readiness is this, Have I thought a lot about the possibility of failure, and do I have a clear and concise fallback plan? What is my worst-case scenario and related to this, if I need to, and if it’s appropriate, how I discuss this with my immediate family… Right. So next is effort. That’s the next category that we need to assess, are you willing to put in the effort and energy and delay immediate gratification to build a small business, do you have the work ethic and dedication and discipline, does your health allow for that effort that’s going to be required or do you need to take care of that first? This is probably gonna be harder than your current job or any job you’ve had now, there was exceptions, some of you are working in really hard, strenuous job, so I understand that, but it will certainly require more mental focus and attention.
0:09:36.8 HENRY LOPEZ And we don’t get to just check out on Fridays or whenever the end of your week is, we take home as business owners all of the problems we have to make, all of those big decisions, we have to worry about whether there’s enough money in the bank to pay the bills and pay the salaries, so it’s a whole different level of stress and work… So the question is this on being ready as it relates to effort, have I given a lot of thought to the effort required to launch a business, and am I in the position to do whatever it takes to start it and get it growing? That’s the question you need to ask yourself there at the end of the day, the next category to assess his time, are you willing to put in the time and make the necessary sacrifices, and I’m going to repeat that word Sacrifice several times here in this conversation, because I think it’s at the heart of what we have to do, in my experience, to successfully launch a small business, this may include not spending time with friends and even family, sometimes it certainly means perhaps cutting back or temporarily eliminating hobbies or other things that you do that occupy your time right now.
0:10:52.6 HENRY LOPEZ What are you willing to give up? Or put on hold. I read a book several years ago by the late Felix Dennis, he’s the author of the book, How To Get Rich and other books, he put it this way, When sharing his thoughts on the type of people who become rich, quote It takes a capacity to work so hard that your best friends mock you, your loved ones, despair, and the rest of her acquaintances watch fertile from the sidelines, half and all, and half, and contempt. And to… I think that’s a great… For me is very inspirational of an extreme perhaps, but of what it takes, at least during that start of phase of your business from developing the idea to the initial stages of your business and then growing it, it will require lots of dedicated time and effort and then over time, once you have the business running smoothly and you are profitable, then of course you can expect to possibly step back from the day-to-day responsibilities, that certainly is a goal, but in the initial phase is, in my experience, it takes a lot of time and effort, so the question, the readiness question related to time is something like this, am I in a unique position in my life to devote the time necessary to launch my business? Am I ready to make the necessary sacrifices?
0:12:20.9 S1: So now let’s talk a little bit more about money. Because it does take money, it might not take a lot of money, but we do need to have some resources in most cases, certainly, there are opportunities, especially nowadays with starting online and home-based businesses to start with very little money, but the question related to this category of money starts with, Do you have the resources to start a business now, it does require some money, and if you’re going to borrow money, any money that you might borrow, you’re going to have to have credit worthiness.
0:12:54.2 HENRY LOPEZ So how will you pay also your personal expenses while you work on starting or running your business, can you keep your day job and maybe do this as a side hustle, where you have a partner or a spouse that will cover the bills of the household, you have to plan for those things and maybe you can’t afford that right now. So you need to save some money. Do you have enough working capital, if you’ve been listening to my podcast, you know that this is what I believe and others believe, is the number one reason businesses fail is you run out of money, and the big mistake that leads to that is upfront, you cut corners and you underestimate how much working capital you need to get the business starting and to profitability, you run out of cash and then you have no other sources of cash. And you have no choice but to shut down.
0:13:44.9 S1: So where will the money come from?
0:13:47.4 HENRY LOPEZ Will it be your money, will there be friends and family partners that are going to contribute capital investors, lenders, you have to, of course, be ready to have some answers to that question, if required, are you willing to start smaller than you plan and then grow through bootstrapping by re-investing your profits, that’s how a lot of us have to start our small businesses because we simply don’t have the money to start it all as our grand vision from day one. So the readiness question on the category of money can be boiled down to this, do I have or have I developed a business and financial plan for a business idea, and do I have access to the capital that I’m going to need to start and run my business? Now, let’s move on to personal characteristics, there’s lots of opinions on what does it take, what type of person is that makes for a good small business owner or entrepreneur born or made… Or both. Here’s the thing, There are certainly common traits that I’ve observed in myself and my business partners and other successful business owners and people that I’ve had the privilege to help and coach people that I have read about over the years, and here is my primary list of those traits, it’s not all encompassing, but in some of the key things that I have found are attributes that a lot of, if not most successful entrepreneurs possess…
0:15:24.6 HENRY LOPEZ So here goes the list first is courageous and confident, courage comes first and then comes confidence, you have to have the courage to… After you’ve done all of the analysis and preparation and research, at the end of the day, there’s no crystal ball, there’s no one that can guarantee that despite your best Planning and Research that this business is guaranteed to be successful. We have to take a leap of faith to the extent we have to have the courage to move forward even when there’s a lot of doubt and uncertainty, when we have naysayers, even when it seems like everything is against us, we need to plan, we need to be smart about it, we need to get help, but we have to have the courage and then the confidence will come over time, we have to be confident though, in our abilities to get it done and our abilities to bring to it our full effort and our willingness and ability to give it what it takes and requires, so courageous and confident. Second is work ethic and disciplines have combined some of these because I think that they are related work ethic, and dislike have to have that work ethic that’s going to push you through the hard times, is going to push you to get the work done as opposed to sit and watch television or play on your phone, you have to have the discipline to stick to it, it’s one thing to do it for a week, it’s another thing to keep at it and add it, even when you hit some obstacles in the road, you have to have the discipline to push through.
0:16:45.4 S1: I think you need a little bit of creativity and flexibility, and if you’re the type of person and things here, I’m not a creative person, I’m not talking about can you draw well or you… A painter I’m talking about, can you creatively think of different solutions you need to tap into that? I think that we all have that ability. It’s just a matter of whether you’ve buried that or you’re able to tap into it, creativity and flexibility, because you have to be able to adjust and maybe even pivot in the course of developing your business idea and your business model, are you a self-starter and are you resourceful, like in the corporate world, where someone else directs us often as to what to do next or what to focus on, or what the goals of the organization are, when you’re on your own starting a business, except for hopefully you’re a partner or if you’ve got a coach and a mentor, but even despite that, at the end of the day, no one is going to be checking that you got that work done or that you put in the extra hours tonight instead of watching Netflix or whatever it is, it’s gonna take…
0:17:49.3 S1: You’re gonna sit outside that competitive business on Saturday and for two hours, make a note of who’s coming in and out the door, those things have to come from you, you have to want to do it, you have to find the word with all in yourself to go do it and you have to be resourceful. You gotta figure things out when somebody says no, or there’s a dead end or you can’t get a particular question answered, you gotta be resourceful enough to go get it, to go find it, long-term focus is the next characteristic that I find is common across entrepreneurs, we tend to think about Where is this taking me in my longer-term journey, that’s why the why is so important, how it is what I’m doing here and the sacrifices that I’m making now, how does that get me or help me make progress towards towards where I want to go, let’s say five years or 10 years or farther down the line, I do think you need some smarts, I’m not talking about intelligence in the traditional sense, but smart.
0:18:48.5 HENRY LOPEZ You have to have some level of intelligence, but it’s not… You don’t have to be any kind of a genius for this, the smarts is more… The reason I use that term, it’s more of what some people might refer to as street smarts or that savviness of awareness of the world and how things work and how emotions come into play and how people behave and what motivates them… That’s what I mean by smart. I think that that certainly helps if you’ve got that high emotional intelligence, this is an low post briefly pausing this episode, to invite you to schedule a free coaching consultation with me, I welcome the opportunity to chat with you about your business plans and offer the guidance and accountability that we all need to achieve success as an experience, a small business owner, myself, I understand the challenges you’re experiencing, and often it’s about helping you ask the right questions to help you make progress towards achieving your goals, whether it’s getting started with your first business or growing and maybe exiting your existing small business, I can help you get there, to find out more about my business coaching services and to schedule your free coaching consultation.
0:19:59.7 HENRY LOPEZ Please visit the holiness dot com, take that next step today towards finally realizing your business ownership dreams. I look forward to speaking with you. See, persistence and perseverance are the last two, so you’ll have to keep fighting, you have to keep fighting, you have to persevere, because this is not easy, it’s not an easy path. It’s exciting and it’s fresh when you’re first talking about the idea and you get excited is that honeymoon phase of it, and then reality sing, and when you start doing a research in the work and you probably get maybe some data points that are contradictory to supporting what you’re trying to do or you’re struggling with figuring out pricing, or you don’t know where the money is gonna come from, where you got rejected for the bank load, those things are going to test your perseverance and your persistence to keep fighting and keep moving forward. The great entrepreneur, Gino Wickman, who has written several books, you may have read or heard of, his book traction, he was one of the founders and creators of the entrepreneurial operating system OS. But his most recent book is entrepreneurial leap. And in this book, what he puts forth is the characteristics that he believes are essential to being an entrepreneur, and so I wanna share those with you as well for some thought, and I’ll give you some opinions on some of them, but these are additional traits, characteristics that Gino Wickman believes are necessary and that you must possess to be a successful entrepreneur, and they are these, you have to be a visionary, which means you have to be able to look forward and see and predict what might be coming next, certainly as business owners, that’s going to be demanded of us now, often, that might be one of the reasons why you partner, you might have a partner who’s more of a visionary and you might be more of an implement or an execution type person, and that’s okay.
0:21:53.8 HENRY LOPEZ I think though that is business owners, regardless of whether we have partners or not, we have to have some ability or develop that ability to look forward, he thinks you also have to be passionate, so there has to be some passion there… Now, be careful here, this doesn’t necessarily mean that you should move forward with an idea in itself that you’re passionate about, it’s about more about you, that’s great if you are, but it’s about being passionate about the pursuit of business, being passionate about being an entrepreneur, about serving your clients, your customers, your patients, the third one he says is being a problem solver, and I touched on that one, I think in my list, are you good at… Do you naturally have an ability or have you developed an ability to solve problems because that’s what you’re going to be faced with sometimes on a daily basis with these fires that’ll come up in your business, even before you get started, that you have to be able to figure out how to solve and not let it overwhelm you, you have to be driven. So I agree with that. I think that relates to my point about work ethic and discipline, and persistent, you have to be driven, you have to be a risk taker, but as I mentioned earlier on the point of risk, I think risk is relative, I think it’s a matter of perspective of your position relative to the risk that you’re about to take, I, for example, do not consider myself generally speaking, a risk-taker, in fact, I think I’m rather conservative when it comes to financial risk, but I do enough analysis and planning, and as I mentioned earlier, I try not to put so much into an individual business that if it fails, it would ruin me financially, so that allows me to balance that risk for myself, and then the last point, the last trait is…
0:23:41.0 HENRY LOPEZ He says it’s critical, which I agree with, which is you have to be responsible is the word that he uses, but what it means is you have to be accountable, don’t point fingers as to why this didn’t work, or why you’re a business failed, or why this isn’t happening or why are sales not happening, or why are people rejecting your product or service… You have to be accountable, you have to be resourceful. You have to be responsible for your own actions. It’s one of the reasons why, or should be one of the reasons why you want to become an entrepreneur is because you embrace, you want to have that decision-making responsibility, be responsible and take accountability for your actions or lack thereof, to summarize on this category of personal characteristics and traits. I wanna make sure that what I’m sharing with you here isn’t that I’m saying you have to check off all of these personality traits that I… But you do, I think, have to assess, Do I possess most, if not all of these characteristics that in my experience and other people’s experience are needed to be a successful small business owner, and you wanna continue developing these skills or characteristics or traits now, personally, I think anybody can become a business owner with some basic components of these traits, I think it’s a matter of how badly you want it and how much you’re willing to develop or uncover some of these traits that might be more hidden in you or in your personality.
0:25:13.6 S1: So the last category that we want to consider and measure in deciding if we’re ready now to start a business as a general business ownership knowledge to increase your likelihood of success with your first business, you need to acquire at least some basic knowledge of business, of course there is always a first time for everyone, and not having previous business experience does not mean you can’t be successful, but you’ll have to be willing to learn and also get the help that you need to cover some of those blind spots perhaps.
0:25:46.2 HENRY LOPEZ And by knowledge, I’m referring mostly to business operations knowledge, the know-how of running a business profitably, but let’s break it down, the areas of knowledge are certainly, before you get to that business start-up knowledge, so everything that goes into planning and research and preparation and negotiations, those kinds of things, all of the things that you have to do to start your business, you may have zero and you probably have very limited experience there, so that does not mean you can’t start your first business, obviously, it means that you have to get help along the way, it means you need to learn, perhaps you need to slow down and acquire more knowledge, however, I wanna caution you against feeling like, Oh, I need to learn more, or I need to read one more book, or I need to go to one more workshop or one more program, all of those things are great, but at some point you have to determine that you know enough and you’re gonna learn as you go, and you need to keep moving forward, so there’s business start-up knowledge, and as I mentioned before, there’s operations knowledge, understanding systems and financial management and human resources, how to manage and lead people, marketing and sales, customer service, legal, all of those aspects that you have to have some high level knowledge of, but then you can bring in experts like an attorney, like a CPA to help you with those areas of the business, where not only are you not an expert, but you shouldn’t become an expert anyway, so having a broad, high level knowledge of either what it takes and you know how to do it, or you bring in your partner with…
0:27:26.1 HENRY LOPEZ Or you hire someone to help you in that particular area. Related to operations knowledge, the question at the end of the day here to assess, related to business ownership knowledge is, Do I have an extensive background in business management, and if not, am I constantly reading and studying and learning myself, and I’m willing to get the help that I need to fill in the blanks where I need it to help me get started and to run my business successfully and profitably. Here are some of the things you should be saying or thinking, if you are ready to start your first small business and they include these questions, I have to do this, I will die if I don’t do this, that’s how badly I want to do this business. Others are doing it, why can’t I? I am confident I can succeed, I am prepared for failure, but I have a plan to succeed, I accept the real possibility that I may fail, I am willing to make sacrifices. Oh.
0:28:35.9 HENRY LOPEZ And by the way, I am scared. I have never done this before, and sometimes I’m not sure if I even can, so it’s absolutely normal that you’re gonna have those doubts, that impostor syndrome that kicks in some time… We all suffer from that, but by and large, you should be getting to the point where you… Most of those are the things that you’re saying. That’s one way to determine that you’re ready, if you’re not… If you’re saying none of those things and maybe you need more time, we’re learning more preparation, more skills development to get to that point, and then you’ll be ready. So of all of the categories that I listed, let me just go back through them right quickly, the categories that I want you to assess yourself in include your why your personal… Why your purpose cause belief or vision for your future and why this business makes sense, that includes the freedoms that is hopefully going to help you get for yourself and your family, the mental and emotional readiness and then the effort that you’re willing to put in the time that you’re willing to put in and sacrifice so that you have it available, the money or other resources that is going to require, including credit worthiness, the personal characteristics that a lot of other successful business owners and entrepreneurs have, how do you match up to that profile and the business ownership knowledge that I just walk through, the how-to of getting ready, preparing for and launching and growing a small business, so if you’re less proficient to ready in one or two areas, it’s not as much of a potential challenge is not being ready in multiple or most of those areas.
0:30:17.4 HENRY LOPEZ So for example, if you have not had any business ownership knowledge, which is most of you, if you’re starting your business for the first, that does not mean that you’re not ready, it might just mean that you need to learn more or get help or partner with someone, that does have that experience. So a low assessment in a particular area could be addressed through a partnership or perhaps more structured business model, like a franchise, or of course, getting a mentor or a coach to help you through that process, it may also indicate that it may be best for you to start smaller and then grow over time, and this is an approach, what I’ve referred to as the MVP or the minimally viable product approach. That’s usually what I recommend anyway. So I’ve been referring to the business ownership readiness assessment tool, that’s a free download that I invite you to come and get at the show notes page for this episode at the holiness dot com. What this tool will do, it’s a spreadsheet and you’ll plug in some numbers after you assess yourself in these categories that I just walk through, but it’s going to help you determine what you need to be ready to start your business.
0:31:30.3 HENRY LOPEZ How ready are you now, and if you’re not quite ready, what do you need to do to get there? It’s a road map for you. It assesses you on those eight categories of readiness, so I encourage you to use this assessment tool now and then over time as you develop your skills and your confidence, use it as a periodic assessment tool for your readiness, it’s your road map of skills, knowledge and to help you and to help rather that you need to get and have in your arsenal before you start your first business, ideally, this is a tool to help you assess how ready you currently are and what you need to work on to get ready, it’s your personal scorecard. Or assessment, you don’t have to share it with anyone, so download the business ownership ready assessment tool on the show notes page for this episode at the holiness dot com. So I have done several episodes on the topic of, Are you ready, and so I just wanna highlight a few of them if you wanna explore further in detail, I’ll have links to these related episodes on the show notes page for this episode, but here are a few that I wanna highlight episode are other means I have re-released it because it’s one of the first episodes that I released six years ago almost now, and that is ready to be your own boss question mark.
0:32:52.9 HENRY LOPEZ So RO is a good one to explore this topic in more detail on an episode, just about that episode, 292-296 and 309. Then in each of those episodes, I explore in more detail, the concept of, Are you ready? Are you willing? Are you able, and I explode that out a bit more and give you a lot more detail on what I mean by ready, willing and able. I mentioned Gino wick man’s book, entrepreneurial leap, that’s definitely a book recommendation for you on this topic, and of course the most popular book recommended… Of every guest that I’ve ever asked. Number one is the E-Myth. If you have not read The E-Myth by Michael Gerber, I think it’s a must-read for aspiring business owners and the existing business owners are like… The download again, is the business ownership readiness assessment tool. Go to the holiness dot com to get that. I also have a special offer on my online self-paced course, that course is called starting your business, are you ready? And I have a discount code for you to use, that you’ll find on the show notes page for this episode at the holiness dot com, that course is a video or self-paced course uses is this same assessment tool that goes into step by step as to all of these things that I’ve talked about here in this episode, so if you think you need more on this, you feel you need more guidance on how to determine if you are ready, then this online self-paced course is for you.
0:34:27.7 HENRY LOPEZ What are the key takeaways that I’d like you to take from this episode? I think it’s about understanding and being very clear on your Why before you continue to move forward with starting a business, it’s about assessing, determining for yourself how ready, willing and able you are today to be your own boss, it’s about understanding and comparing those characteristics that are common of other successful entrepreneurs and how do you match up to that, and again, it’s not that you’re supposed to match up 100%, but it’s another indicator as to how ready you might be to start your first business and then complete… Take the time to complete the business ownership readiness assessment tool. This is your road map, and it’s a free download for you at The How of Business.com, you’ll identify then the areas that you may need to develop or address before you start your small business, and then ongoing… You can measure your progress. Again, it’s not about whether you can or can’t, it’s about when sometimes we are each on our own individual paths to starting our first business, you need to assess how ready you are right now, and if you want it bad enough, what do you need to do to get ready so that you can start your first business, I wish you the best as you do start and grow your successful and profitable small business.
0:35:51.4 HENRY LOPEZ This is Henry Lopez, thanks for joining me for this episode of The How of Business. I release new episodes every Monday morning, and you can find a show anywhere you listen to podcasts, or at my website, the TheHowOfBusiness.com. Thanks for listening.