Do's and Do not's for starting a business
My personal journey starting a business has had a few crash and burns, and a little success at some extend; Would I consider myself a successful entrepreneur or not is not the question, I think that will answer itself later on, however, starting a business is not limited to become an independent business man, it also applies as part of your daily job as a member of a major company. Sometimes when I hear the term entrepreneur as a such I feel as it's quite limited, because as part of a management team even though you may or may not have stocks on the company you are part of the launching team for that particular company, therefore you are kind of an entrepreneur; it may sound as a semantic issue but, just bare with me for a while and see if you agree with me.
First of all let me share my experience as an entrepreneur, back in the days when I was a young graduated from college, and after a few years working in a small business, my ambition drove me to start a small accouting firm, I didn't have much money to invest but either way I tried, I became a one-man orchestra, I used to knock on every door possible looking for independent workers or small companies who wanted to outsource either their bookeeping or to do their taxes, so I took my good old '82 nissan all over the place to find new customers, I remember I bought my first PC, a state of the art Lennox 486, (at least by my stardarts) and a couple of multi-company accounting softwares where I can keep my customers records. My first office a small place at my parents', near their living room with the agreement that I was going to pay for the utilities instead of a rent.
My first customers, a marketer compañy, several teachers of the College I started teaching, a small stamping company and a travel agency, and the very first a software development company which needed some financial analysis for their first 3 years of operation; that's where I started, and all of a sudden, I had the chance to hire some help, a student of mine agreed to work with me and then I became a business man, no matter that I needed to wear so many hats a day. The business grew and we were able to sublend a small office space down the street; the same address it kept for the following 10 plus years; what I did right? well I tried to spend my very little cash in a diligent manner and knock doors tiresly to get more and more customers; I built up a brand, reliable, always available, always straight up; in all fairness the kind of customers I got where either acquaintances or referrals so the competition was not fierce and were more friendship based, although I have to admit I even have some churn because of the limited resources we had at the time; Unfortunately by 1997, I transferred the business to my Dad because as a newly wedd I thought it would be better for my ensuing family if I got into the corporate world.
The second time around a few years ago, A very good friend of mine and I decided to start a whole new telecom business, it was such a fun ride, we started developing the products: cloud based IP-PBX, state of the art technology, GPS trackers, broadband dedicated links distribution, even mobile phone business... it was so ambitious, the best market pricing, we were on the top of the world, we even had trademarks, we designed the whole corporate image, we designed the whole policies, procedures, vision, strategy and so on and so forth. Unfortunately this time around we were playing with the big boys, large corporatios where the competitors, nonetheless we knew the market, we knew how to sell; I remember visiting customers offering the best product available at the best pricing. We hired a whole team, a sales force, product development at Salt Lake City, applications development at Santiago de Chile, tech support at Guadalajara and Mexico City, even a new business manager at our own offices in San Antonio and our Brand New offices in las Lomas de Chapultepec one of the nicest neighborhoods in Mexico city; we were not only good, we look good; we had a 50 million dollars business in our hands.
I developed channel sales market, we were getting distributors in several cities within Mexico, we were almost there, but... there is always a "but", our brand was not recognizable for new pospects; our pipeline started to grow thin.
Then we started thinking about international, and rural, we thought it would be a great idea to start deploying telephone service at unattended areas that major phone companies doesn't even cared about; we even install several lines there. The investment needed was big, but in our minds it was worthwhile, however, being IP-PBX we needed to become also an ISP, but the end customer would need to buy IP phones, receivers, among other devices, but we couldn't ask poor people to invest that much money and we didn't have enough cash to bare those costs, and amortized them in the mid term, so we got into the task of get government financiation as part of a social development program, and as you may expect, we hit several dead ends on that one; going international with GPS' was also a good idea, so we got a distributor in Costa Rica, they posted a quarter million dollar order as first purchase, so we were extremely happy with it, we even signed the distribution agreement, NDA's and everything, we requested the guarrantees, and we even got the paperwork shown so we can proceed. We placed the order to our manufacturer and even gave an advance payment. Long story short we end up loosing a few tens of thousand dollars because the distributor never comply with the guarrantees and we end up voiding the contract.
Along the way we got additional successes but the plan went so much slower of what we expeced. So what the lessons learned would be? this second time around we were a little reckless, even though we were taking the right steps building the brand, we didn't invested enough at marketing or advertizing to strengten it, we may had done business with the wrong people or I should better say we didn't background check the people we were partering with on several business, but most importantly, we forgot Denis Waitley quote:
"Expect the best, plan for the worst, and prepare to be surprised." - Denis Waitley
Over the second part of this article, I'll try to explain why I consider part of your daily job within a corporation as entrepreneurship, although the definition kind of help me doing so.
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