Recently, there has been a lot of press and buzz about the changes that will occur with the recently passed legislation permitting crowdfunding of investments. There is a 270 day rule making period for the SEC to make up their minds on how to regulate the ‘new’ industry, but nevertheless in the grand scheme of things, this is not an extensive period of time for people to become prepared. Start-ups and portals (such as ourselves) are extremely excited at the new funding possibilities for innovative new businesses!
However, in the midst of this discussion there is one thing that we often forget. Crowdfunding (or as we like to call it crowdinvesting) is going to assist start-ups, but will it create an environment encouraging more people to start-up? We think it should and here are a few points for all of you 9-to-5ers to prepare yourself to take the plunge!
If I quit my job, my lifestyle will be severely affected!
A lot of people think that without the stable income that a 9-to-5 job offers you, that your lifestyle will be severely affected. However, if you really take a step back and figure out what you want vs. what you need, you would be really surprised at what you can cut out. Even taking it a bit further, discerning between what you really really want vs. what you really want will probably save enough money to continue on! While you are starting your business, you can even have a part-time job or freelance (depending on your skill set) to augment your income.
Here are a few things you might think about:
- The number of times you eat dinner out in one month
- Making your own breakfast and coffee ( ~$5.00 * 20 working days = $100 / month)
- Do you smoke? Just quit ($15.00 * 30 = $450 / month && high risk of death)
- Decrease your utility bills to the best extent possible
- Look into your cable bundles and see if there is anything you don’t even watch or need
- Go through your credit card statement and examine anything that’s recurring (auto billing). I’m guilty of letting a lot of little things go because I don’t pay attention and inevitably adds up to a good chunk of cash
And then if you have done all this and you still don’t want to break off on your own, at the very least you probably saved a lot of money! That’s a business in and of itself!
What do I do if my business idea fails?
Every business idea has a risk of failure for various different reasons. But as an entrepreneur you have a vision and passion which serves as the drive for both yourselves and your team. However, every founder should have the acknowledgment of failure in their minds as delusions of grandeur often leads to a very stubborn point of view and may even inevitably cause failure.
So you want to break off on your own. You have x months of living expense saved up and some investment dollars that have been scrounged up between yourself and F&F.
Perhaps now is not the right time to quit. If you can work your day job and work on your start-up at the same time until it is no longer feasible. I don’t need to tell you what this might do to your personal life, but these are the start-up sacrifices. If your business fails, at least you still have the 9-to-5 covering your living expenses and benefits. Take a breather, take a step back, repeat.
So now you’ve broken off on your own. Your business may fail, you may be looking for another job in the near future, or all of the above. However, this is not the way an entrepreneur should think. It could definitely fail, but being resourceful and hopeful even in the most difficult of times will differentiate those who are successful and those who are destined for the cubicle life.
I don’t really have any tangible skills. How can I even found a start-up?
Trust me when I say, you have tangible skills. There are skill sets that are sometimes less verbalized, but nevertheless are real and sit with certain people more than others. While you may currently lack specific technical skills that we often associate with start-ups (i.e. coding), that is not the only skill set you need to have a successful business. There are the technical folks, the business guys, the marketing pals and the sales gurus that all fall under a start-up umbrella at some point or another. We are used to envisaging an intense team of programmers sitting in a room until a fantastic idea / app / website arises after which everyone becomes a user and adopter, inevitably resulting in riches and fame for the founders. However, the truth of the matter is there is much more to successful start-ups and businesses in general. You definitely have an idea and a skill set that could become valuable in creating the next big thing.
Now you have to go find your team ! =)
I don’t know anything about starting a business or start-ups..
Full disclosure (self-advertisement) – You should be signed up on Return on Change for the launch and also following our blog for cool resources!
But in all seriousness, this is where you have to put on your entrepreneur hat and get creative. Scour the internet, reach out to folks and don’t be scared to share your idea. You would surprised at the number of people out there who just want to help!
For example, the NY Tech meetup listserv has been so awesome for me. Just today there was an email greeting everyone on this season of renewal and all throughout my membership, I’ve learned so much!
So now to avoid becoming this…..
By Sang Lee