Last month saw the Great British Entrepreneurship Awards, a celebration of some of the most exciting small businesses in the country. With more people starting businesses, despite the pandemic, this is a great opportunity to learn from those who have already been successful.
React to challenges
Succeeding on the high seas of business is challenging at the best of times. However, COVID-19 has confronted entrepreneurs with a landscape more difficult and uncertain than any in living memory.
Take Charlie Taylor and Natalie Taylor Johnson, for example. They realised their dream of starting a wine bar in Bristol last, but barely six months later, the pandemic hit.
With lockdown looking inevitable, they realised they would have to change plans quickly to avoid disaster. Their solution was to switch to a ‘collect service’, which would enable them to continue serving wine throughout the crisis.
They also held turned a planned wine tasting evening into an online event. It was so successful that they have been holding similar virtual wine tastings ever since. They even managed to turn their troubles into an exciting PR opportunity by securing coverage in Vogue.
The lesson to be learned here is that in life, and in business, events can sometimes spiral beyond your control. How you respond will determine whether you are successful or not. If you get it right, a threat can often be turned into an opportunity.
Have a plan
The most successful entrepreneurs are those who have a plan for the future. They may be starting small, but they have a vision for the kind of business they want to be in the future. For example, when Steve Jobs got together with young computer whizz Steve Wozniak in his garage, he had a clear vision of the type of company he hoped Apple would one day become. In the event, it surpassed even his wildest expectations.
If you put your customers at the heart of your plan, then the likelihood you will fail decreases drastically. Gagan Manak, who runs a luxury housebuilder, says that customers expect a ‘faultless experience’. If you constantly plan for what customers want and require, no matter what your business is, you will be one step closer to success.
Ambition can be crucial to success as an entrepreneur and this year’s awards recognise that with the ‘scale up category’ which rewards those businesses which have their eyes dead set on future growth. Among this year’s finalists is Samantha Charles whose fast growing consultancy Float Digital has been recognised by Peter Jones as the most ‘ambitious business in the UK.’ She was chosen for having the determination, enthusiasm and passion to grow her business.
Be productive
Successful entrepreneurs take a lead and get things done and the awards recognise this with the ‘entrepreneurial spirit’. These celebrate those entrepreneurs who take a lead to power their business forward.
This will be more important than ever during the early stages. With staff at a minimum, you’ll find yourself dong just about everything from planning strategy, to delivering the service your company provides to doing the accounts.
Natasha Vigille of Cornucopia Emporium, exemplifies this perfectly. She started from scratch, learning the basics of candle making, to create a thriving and award-winning start up.
She invested her own money into the business and launched an online crowdfunding campaign to earn the rest and, within 55 days, she had raised more than £4,000 including match funding from NatWest. It wasn’t a huge amount of money, but it was enough to get started and, since her launch in 2019, she has been going from strength to strength.
Her story shows that success isn’t something that comes easily. You’ll have to reach out, put in the hard yards and grab it with both hands. The same is true for your personal finances.
Plan for the worst
As successful as all these entrepreneurs have been, they all operate in an environment in which the chances of failure are greater than success. It’s a well worn stat that 90% of start-ups fail. For every success story there are many which sink without trace.
As a result, a smart entrepreneur will be someone who diversifies and finds a way to open up another revenue stream. It might mean keeping some rainy day savings locked away or starting up a side project to bring in additional revenue. If the worst happens and, for whatever reason, your enterprise fails, you’ll have something to fall back on.
Planning ahead, with the worst-case scenario in mind, will also help keep your business on the rocks. Surprisingly perhaps many entrepreneurs have no idea about the true finances of their businesses. They don’t know precisely how much money is coming in and going out of the business or the real costs they might expect over the coming months.
As a result, they leave themselves open to the sudden ‘iceberg’ moment as something catastrophic looms out of the shadows. It could be a temporary cash flow shortage, a major cost you hadn’t seen coming or an unpaid invoice which leaves you unable to afford payroll.
Whatever the problem you’ll have a better chance of avoiding it if you have real time information about the current state of your business as well as clear projections of what income you can reasonably expect to receive and expenses you might incur. This will help you see what’s coming and help you avoid those icebergs before they rip a hole in your hull.
Each of these entrepreneurs has their own unique talents which have helped them become successful, but each of them also adhered to basic fundamentals about planning, money management and attitude which work both in business and in life. It just goes to show, good principles for personal finance will also stand you in good stead if you decide to join the growing ranks of entrepreneurs.