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SMALL business owners can easily become so caught up in the idea of running a business that they lose sight of the fact that they should be trying to build something they can sell.
Local tech entrepreneur Justin Spratt posts some pretty intelligent links up on Twitter for an Australian*, and if you are an entrepreneur you might want to follow him. One of his most recent links was to an article about real versus involuntary entrepreneurship as a fallout of the financial and economic crisis.
The article looks at data from the Kauffman Foundation and its most recent Index of Entrepreneurial Activity in America. In a nutshell, entrepreneurial activity was high, but this was partly a function of people being forced into self-employment.
A line that jumped out at me was: "The nature of the data makes it difficult to distinguish the 'merely' self-employed from those who might meet the conventional definition of an entrepreneur."
This, I thought, was quite an important aspect to discuss. Yes, there is a huge difference between being an entrepreneur and being self-employed, but making this decision also has a lot to do with how you will conduct yourself as a business owner, and it is something you need to decide upfront.
For sure, many self-employed people build an asset they can sell, but too often they are so focused on surviving that they don't build something that is transferable.
Pavlo Phitidis from business accelerator Aurik drums on about how important it is to build something you can sell. He talks about the entrepreneur who spent his life investing in his business in the hope that he would have something to sell, and then being bitterly disappointed when he was offered far less than he expected.
Nurture your assets
As a business owner, this dictates where you are going to invest your time and resources. You might hate doing the accounts and keeping track of what your company assets are doing. But if you are planning to sell it, you sure as hell are going to need a set of books that reflects the value.
If your assets are your clients and contact database, how much time and energy are you contributing to making sure this is up to date and the relationships are constantly being maintained?
What is your business asset? if I set up a store next door to you - either physically or on the internet - what attracts me or makes me stay loyal to your brand?
Is it your intellectual property or capital you are investing in? If you are hit by a bus tomorrow, does the business stop running?
At some point you are going to want a payback for investing all the blood, sweat, money and tears into your business. Are you doing enough to actually monetise?
While the country is being gripped by Soccer World Cup fever, small business owners would do well to ask themselves whether they are building something they can sell - or simply surviving.
- Fin24.com
* PS Justin, it must be the World Cup patriotism coming out in me. To make up for the dig, I did put R10 down on Australia to win the World Cup at 125:1.
Local tech entrepreneur Justin Spratt posts some pretty intelligent links up on Twitter for an Australian*, and if you are an entrepreneur you might want to follow him. One of his most recent links was to an article about real versus involuntary entrepreneurship as a fallout of the financial and economic crisis.
The article looks at data from the Kauffman Foundation and its most recent Index of Entrepreneurial Activity in America. In a nutshell, entrepreneurial activity was high, but this was partly a function of people being forced into self-employment.
A line that jumped out at me was: "The nature of the data makes it difficult to distinguish the 'merely' self-employed from those who might meet the conventional definition of an entrepreneur."
This, I thought, was quite an important aspect to discuss. Yes, there is a huge difference between being an entrepreneur and being self-employed, but making this decision also has a lot to do with how you will conduct yourself as a business owner, and it is something you need to decide upfront.
For sure, many self-employed people build an asset they can sell, but too often they are so focused on surviving that they don't build something that is transferable.
Pavlo Phitidis from business accelerator Aurik drums on about how important it is to build something you can sell. He talks about the entrepreneur who spent his life investing in his business in the hope that he would have something to sell, and then being bitterly disappointed when he was offered far less than he expected.
Nurture your assets
As a business owner, this dictates where you are going to invest your time and resources. You might hate doing the accounts and keeping track of what your company assets are doing. But if you are planning to sell it, you sure as hell are going to need a set of books that reflects the value.
If your assets are your clients and contact database, how much time and energy are you contributing to making sure this is up to date and the relationships are constantly being maintained?
What is your business asset? if I set up a store next door to you - either physically or on the internet - what attracts me or makes me stay loyal to your brand?
Is it your intellectual property or capital you are investing in? If you are hit by a bus tomorrow, does the business stop running?
At some point you are going to want a payback for investing all the blood, sweat, money and tears into your business. Are you doing enough to actually monetise?
While the country is being gripped by Soccer World Cup fever, small business owners would do well to ask themselves whether they are building something they can sell - or simply surviving.
- Fin24.com
* PS Justin, it must be the World Cup patriotism coming out in me. To make up for the dig, I did put R10 down on Australia to win the World Cup at 125:1.
