6 Questions You Must Answer 'Yes' to Before Becoming an Entrepreneur

Entrepreneurship has recently become a sexy and trendy topic. The media glorifies the startup unicorns that hit big and TV shows like Shark Tank have introduced the entire world to entrepreneurs, leaving many people asking themselves, “Can I be one?”

While entrepreneurship can be rewarding on many levels, it requires a certain type of person to excel, whether he or she is venturing into this world straight out of school or transitioning out of a 9-to-5 career. There are so many questions to ask yourself before making the move -- and a lot of these questions relate to specific circumstances. But here are six things you most definitely have to answer "yes" to. 

1. Can you afford to take the risk, financially?

An entrepreneur fresh out of school with few to no financial obligations has less of a financial risk than someone with a family, a mortgage, multiple car loans and all the other standard monthly bills families have. 

You need to understand the big financial risk associated with starting a business. Your idea may flop, you may be unable to pay yourself for a long period of time and there is always the possibility of losing it all.

If you already have a stack of financial obligations, start your business on the side. That scenario may not be ideal, but it’s still possible to find success this way. If you don’t have those obligations, and you fully believe in your idea, then go all-in. 

2. Do you have a strong support system in place?

If you decide to start a business, the road is going to be filled with bumps and intersections, each with multiple options; you will have questions, lots of them. It’s important to surround yourself with a support system that will be there to help you solve problems, seek answers and be available when you just need to vent.

Having family, friends, mentors and industry connections to turn to will greatly increase the odds of your business being successful. The moral support alone is priceless. Keep the doubters away. They are toxic and need to be avoided if you desire success.

3. If you keep getting knocked down (and you will), are you going to keep getting back up for more?

You are going to get knocked down -- most likely several times. There is also the possibility of making a wrong decision that causes you to fall flat on your face. If you are expecting to hit a home run the first time you go up to bat, you may as well not even play this game. You’re going to strike out. You’re going to become frustrated.

What differentiates the entrepreneurs that quit from the ones that go on to experience success is the latter group's tenacity -- their willingness to keep taking devastating punches and their willingness to keep getting back up for more.

My favorite example is James Dyson, founder and designer of a highly successful vacuum cleaner. Dyson's first 5,126 prototypes were failures, but the 5,127th one went on to become the top-selling vacuum in the United States. He wouldn’t be worth $4.5 billion right now if he had stopped getting up after being knocked down more than 5,000 times.

4. Can you remain motivated, even without personal luxuries and conveniences?

Mark Cuban often talks about his early beginnings, when he was eating mustard and ketchup sandwiches and sleeping on the floor of a three-bedroom apartmenthe shared with five friends. Put yourself in that situation. Could you remain 100 percent motivated while sleeping on the floor and eating mac and cheese or Ramen noodles?

If not, entrepreneurship may not be for you. It’s often the personal sacrifices that make the biggest difference. Would you sell your car and take public transportation to your office if that meant being able to invest more money into your business? Would you sell your house and move into a small apartment if that meant being able to grow your business faster?

If you want it badly enough, you will do whatever it takes, while remaining laser focused and motivated. 

5. Do you understand that your work/life balance will be extremely unbalanced in the beginning?

Most of your time will need to be allocated to your business in the beginning. You will see your friends and family less and miss out on a lot of the little things you used to do -- like getting together for beers after work on a Friday and taking weekend trips. Instead, you'll have long nights at the office and work-filled weekends.

You have to be willing to put in the time and effort in the beginning. When you start a business, everything is on your shoulders. It’s an enormous amount of pressure that some can’t handle. Over time you will be able to create a healthier work/life balance, but understand that it will be very unbalanced in the early years. It’s just recently that I’ve started to get away from my marketing agency 100 percent on the weekends, to devote that time to myself, my family and friends.

6. Can you envision your success?

Believe you can and you're halfway there. -- Theodore Roosevelt

That's one of my favorite quotes about envisioning success. If you can’t envision success, then you aren’t ready. You need to see it, and see it clearly. You need to wake up envisioning your success. You need to have that picture engraved in your head. You need to dream about it when you go to sleep.

So, have you answered "yes" yet?

Jonathan Long

10 Ways to Fail at Being Your Own Boss

Whether you call yourself an entrepreneur, freelancer, self-employed or independent contractor, the fact is your dream of being your own boss is shared with a growing number of people. According to a recent survey by Freelancers Unionand Upwork (previously Elance-oDesk), 53 million Americans are self-employment. Another study by Intuit predicts that 40% of the US workforce will be freelancing by 2020.

All of those impressive stats and hopes aside, maintaining (what we’ll call) a “self-employed” career is no leisurely venture. Despite producing work of high quality, many people find themselves coming up short and, unfortunately, having to go back into a conventional job.

Self-employment comes with its fair share of hurdles, but, as with any other endeavor, failing shouldn’t stop you. As Richard Branson puts it, “The best developer of a leader is failure.” Though failures will inevitably happen in the pursuit of working for yourself, you can take steps to prepare yourself, so that you avoid as many of them as possible. Here are 10 reasons why you could fail.

Fear of Failure

Self-employment is the same as starting a new business, with just as many hurdles to clear to keep the doors open. But while some people can use fear of failure as the ultimate motivator, others succumb to the pressure and spend more energy on worrying than on planning for success.

Fear can even kill your career before it starts. So if you find yourself worrying too much, shift your attention to your career’s immediate demands instead of your projected failures. Your odds of success will increase.

Falling to the Competition

The pool of talent is growing, especially if you’re a freelancer, which makes some industries extremely competitive and difficult to get your foot in the door. Many freelancers apply to many, many job openings and never hear back. You might produce the same quality work as some of the top performers out there, but sometimes quality alone won’t be enough. You have to make an effort to stand out. 

There are many options for opening doors, including becoming a better salesperson, having better marketing or providing a unique product. If you are just starting out, you can even reach out to companies you’re familiar with and offering to do an assignment for free to prove your worth. Don’t forget about building your network too, as satisfied clients make great referral sources.

No Business Plan

Surviving a self-employed career requires more than just applying to job postings. It’s about setting a timeline of goals and finding ways to reach them. Just as with any other business, the best way to ensure success is to create a plan for your business. This will allow you to strategize and understand your objectives. If you have a clear vision of where you want to be, you’ll be able to recognize, tackle and move on from any failures that may occur.

Lack of Publicity

Your personal brand is your best marketing tool, and it’s your responsibility to build it up. As you know, there is no sales or marketing department that will promote your work. Though you may want to devote your time exclusively to your specialty, you also need to focus almost as much energy on making yourself known.

A cost-effective way to promote your personal brand is to create a blog or website to showcase your portfolio. Using social media sites like LinkedIn or Facebook can help you promote your product to the world. Remember to take your efforts offline. Attend industry events to build your network, and let your results speak for themselves through word-of-mouth marketing. Also, don’t forget your business cards! 

Procrastination

The world of self-employment is no place for procrastinators. In order to seek and secure work, you must be a self-starter. There’s also no boss to delegate tasks to you. So, if you’re not finding and doing your own work, you’re going to wash out. And although taking a creative break can be good, if you don’t meet the client’s needs, they’ll most likely move on to the next person.

Avoid procrastination by addressing the root of why you’re procrastinating. If it’s fear of failure, remember that you’re already failing by avoiding the work. Instead, be successful by actually starting it. If you’ve landed a job that is bigger than your skillset, take some time to broaden your skillset. That will give you the confidence you need to proceed.

Poor Prioritizing

Getting used to being your own boss can be tricky. You’re on no one else’s schedule except your own, so it’s understandable that you may first gravitate toward activities that are not essential to work. But this gravitation is why many people fail; they don’t prioritize.

The longer you put off your work, the less energy you’ll have when you most need it, and the worse your work quality will be. If you want your work to be sustainable and successful, it’s essential to keep a schedule and put your responsibilities at the top of it.

Not Seeking Family/Household Support

Life for the self-employed need not be lonely, but it can feel very solitary at times. That’s why family or household support is worth seeking. It helps maintain your mental wellbeing, especially in times of crisis. You might not think you need it now, but the romanticism of the lone entrepreneur isn’t worth the possibility of harming your relationships through prolonged absences. If you’ll be working from home, make sure everyone can make the adjustment when it comes to things like personal space and scheduling.

Not Understanding What to Charge

For many, determining your worth is a delicate but brutally consequential aspect of your career. It’s not much different than the stress-inducing conversation that precedes asking your boss for a raise. But we all know that if we don’t set a certain bar for ourselves, no one else will.

So, recognize what goes into accurately pricing yourself. If you’re new to the game, charging a lower rate than the competition can be a great way to build a client base. If you’re a seasoned pro, then charge like one. If you’ve been working with a company for a reasonable amount of time, you can begin to raise your rates. Also consider the size of the company you are doing work for, as well as the budgets of their individual projects.

Being Financially Disorganized

It may be hard to understand at times, but for most self-employed people having the books in order gets harder the more successful you become. Think about it. It’s easy to keep track of income and expenses when you are just starting out with a few clients. But as things begin to pick up, your accounting becomes something you do late at night when all your real work is done.

This can spell disaster when you stop paying attention to the expenses and costs of doing business. When you don’t have a clear picture of your financial health, you won’t know when you’re in trouble. Don’t let your finances get out ofcontrol, even if it means outsourcing the work to an expert.

Failing to Pay Quarterly Taxes

Speaking of expenses, many self-employed people overlook the tax situation that comes along with working for yourself. According to the IRS Self-Employed Individuals Tax Center, “As a self-employed individual, generally you are required to file an annual return and pay estimated tax quarterly.”

If you ignore the quarterly requirement and owe more than $1,000 in taxes at the end of the year, you may face fines and penalties. Though some people opt to pay the penalties come April 15 to hold on to precious revenue, it’s best to pay your estimated quarterly taxes via Form 1040-ES. As good as it may sound to hang on to the money now, it’s a lot more lucrative to not be forced into spending more than you would have had to later.

Starting and maintaining a self-employed career is like owning a business. Though it can afford you many freedoms, you will also face more demands. You will be your own C-suite employee of every stripe. But if you are prepared for what’s to come—including potential hiccups—then your chances of surviving by practicing your true vocation will drastically increase.

Sean Bradley