Want to be an entrepreneur? Here are some tips
Author: Helen Dennis, Specialist on Aging
Last week we discussed entrepreneurship for those in the second half of life. Today’s column offers tips from experts.
An important first step is to ask yourself a few questions, suggested by Mary Beth Izard, author of “BoomerPreneurs” (Acheve Consulting, 2010) as noted in a May 2012 Money Magazine article:
• “Have you set high goals for yourself?”
• “Are you quick to adapt?”
• “Are you a fierce competitor?”
• “Have you been able to thrive when facing uncertainty?”
• “Do you like making decisions?”
According to Izard, if you can’t say yes to most of these questions, entrepreneurship is not for you.
There are many next steps after a self-assessment according to Donna Rosato, author of the Money Magazine article “How to be a Boomerpreneur”:
“Make sure you are in love”: Be passionate about your venture. If you aren’t, you might resent the amount of time you have to invest.
Be aware of time. Older entrepreneurs don’t have as many years to succeed – let alone recover from failure – as younger folks. It takes three years to show a profit, according to the Small Business Administration. Try to show a profit in less time and do what you know. If not, at least “Learn before you launch.”
Consider changing your lifestyle. This is a hard one, particularly if you are used to a standard and style of living for the past 20 to 30 years. Determine flexible expenses and
those that are non-negotiable.
Determine your financial base. Project your income and include health insurance costs. Estimate your start-up costs, which include living expenses. Also determine what you will be giving up – these are called opportunity costs and may include retirement savings, health insurance, as well as unpaid vacations.
Financing. Often family and friends are the first line of financing – at least for a small business.
Here’s a good story with advice from a 71-year-old lifelong serial entrepreneur.
Randal Charlton is a winner of the Purpose Prize. The award is a sort of “Oscars for social entrepreneurs,” as described by journalist Mark Miller in his blog RetirementRevised. It is awarded by Civic Ventures, a San Francisco think tank on boomers, work and social purpose.
Winners must be 60 or older and have effectively solved complex social problems. The six annual winners receive $100,000, often invested back into their business.
Charlton’s background includes such diverse ventures as tending dairy cows for a Saudi sheik and starting a jazz club in Florida.
More recently, he wanted to restore the economy of Detroit by building a successful incubator for entrepreneurs. He called it TechTown. He built it by raising $24 million and recruiting start-ups that created 1,800 local jobs.
We spoke at a recent meeting on entrepreneurship in Kansas City where he told me about his ups and downs.
To mitigate his financial risks, Charlton streamlined his life and expenses at age 60. He rented a small apartment, had no credit card debt and built a house only when he could afford it. He drives a 10-year-old car and has no problem wearing business suits, ties and shoes from a secondhand store.
Here are some of his tips for would-be entrepreneurs, as told to Miller:
“Get fit and keep fit.” To run a business one must be physically and mentally in shape.
“Focus on skill sets.” Look at your actual strengths and find work that is connected to those strengths, rather than your former title.
“Plan an exit as you enter.” If you have a partner, think about a “prenup.” That will allow you to pass the business to others after a few years and get some value from it.
“Mitigate risk.” Stabilize your personal expenses. Minimize your debt if the “business goes south.”
“Leverage everything and anyone who offers to help.” The resources are many. The challenge is to identify them.
“Network, network, network.” Most jobs come from knowing people.
“Forget resumes. If you send out enough resumes, you will need antidepressants quickly.”
“Get in the game.” Don’t stand on the sidelines. Consider volunteering or working as an intern.
In addition to Izard’s book, the Small Business Administration is a good resource. Go to www.sba.gov/content/50-entrepreneurs.
Good luck and success to those who want to be entrepreneurs – at any age.
Copyright 2011 Helen Dennis. All rights reserved.