Virtually anyone can start their own business, but not everyone can turn that business into a successful venture. In fact, according to a Forbes article, 8 out of every 10 entrepreneurial ventures fail within the first 18 months. With the likelihood of success so slim, what is it that makes some entrepreneurs successful while others fail? Could it be luck? Perhaps so.
While we have no control over ‘luck’ here are five ways entrepreneurs can increase the likelihood of their success.
Learn and Perfect a Skill
At the center of every successful business is an entrepreneur with an exceptional skill that customers or other businesses need. In the case of Facebook and Microsoft, for instance, both possessed exceptional skills in coding and programming. For a restaurateur, he may possess skill as an exceptional chef. And for some people, their perfected skill is simply the ability to lead, and to inspire others to work for them.
Start Out Small
Many new entrepreneurs entertain big dreams, before envisioning their smaller goals – perhaps a five-star restaurant, or a graphic design business. However, it’s always best to feel out the market on a smaller scale before expanding. That might mean starting with just one location, or it might mean a food truck instead of a restaurant, or freelancing instead of running a fully staffed business.
Successful entrepreneurs also secure capital, whether it’s from a bank, angel investor, or friends and family, before jumping in headfirst while bills keep coming. By securing capital first, an entrepreneur has a budget to fully invest in the business.
With this investment, the entrepreneur can purchase equipment, hire help, and jumpstart branding. Smart entrepreneurs also save as much of the capital as possible to bail the business out of trouble, should the need arise.
Another way to ensure success as entrepreneurs is to build a buzz for your brand, by engaging in public relations practices. This includes marketing at a grassroots level, through taking part in local events, building a strong presence on social media, and interacting with current and potential customers. It might also involve securing professional help from PR experts who can connect you with big publication opportunities.
Learn to Cut your Losses
The old Kenny Roger’s song goes, “You’ve got to know when to hold ’em. Know when to fold ’em. Know when to walk away. And know when to run.” To become successful, entrepreneurs need to know when to cut their losses and walk away from a failed venture.
Walking away at the right time can mean the difference between leaving with nothing but debt, and leaving with enough capital to start a whole new – and better – business than the last.
There are many obstacles piled high against entrepreneurs which prevent them from winning against larger and more established businesses in the market. But with these tips, an entrepreneur can turn even a failed idea into the rebirth of a new and better business idea.
Chris Burch is a venture capitalist and founder of Burch Creative Capital.