How do you reduce the downside risk in starting a dream business?

Share these new ideas
English: Sir Richard Branson at the eTalk Fest...
English: Richard Branson at the eTalk Festival Party, during the Toronto International Film Festival. (Photo credit: Wikipedia)

An entrepreneur started a gourmet fast food business on a main street in a coastal village but within two years she closed down. Another entrepreneur opened a gift and stationery shop also on a high-pedestrian traffic street and within three years it closed. A young entrepreneur created and online fitness supplement venture which did well for about two years after which the business caved in.

Is there a sure-fire way to reduce the risk of failure in starting your dream business from scratch?

Even Richard Branson, famous for the Virgin Group of companies, began his entrepreneurial journey with a couple of early ventures with failed ones including growing Christmas trees and raising pet parakeets. But Branson went on to sell music records via mail order, bought a nightclub in London, sold vodka and eventually built a business spanning music, media, telecoms, airlines and space exploration.

Some say you’ve got to have business in your blood. Entrepreneurs who have family members, fathers, mothers, uncles, aunts who have done well in business, often seem to do well themselves. But what happens if you haven’t been gifted at birth with entrepreneurship coursing through your veins?

Yet others push the virtues of experience. Get out there into the world of business, they say, experience business life by working hard and along the way you’ll pick up the necessary business acumen. You could also discover a promising business idea along the way. Yet how many people in jobs leave their employees to start their own businesses? If they are really set on starting their own business, they seek out some sort of entrepreneurial training or mentorship.

That’s the other area isn’t it, entrepreneurial training and mentorship. Some believe this is the way to reduce risk in starting a new venture. But how many people can afford entrepreneurial training at their stage of life or even find a close business mentor?

It is hardly possible to reduce all the risks that come with entrepreneurship. That’s why there is such a high failure rate in the first year for small business ventures – research generally puts it at a 90% failure rate although some experts contest this number. If you look at successful start-up founders, the entrepreneurs who do make it past the first year and beyond, you will find that they will be open to new ideas and approaches on how to increase their chances of success. They also possess internal garbage detectors that help them quickly toss out erroneous or downright foolish advice from business gurus out to make a fast buck selling snake oil.

While there are a lot of things outside your control in trying to increase the odds of success in your new venture, the one thing that is in your control is to plan your new venture with a practical, hands-on process tried and true for the past 80 years or more.

Is it difficult and hard to do?

Or fun and exciting knowing that you know what you need to do and what to avoid?

To learn how to turn your promising business idea into your dream business, go here.

Leave a Reply