MONEY Work/Life Balance

How to Get Ahead in Business Without Leaving Your Family Behind

work-life balance
Ivary Inc.—Alamy

Entrepreneur, husband and dad Sam Bahreini shares the work-life balance strategies that have worked for him.

Harry Chapin’s “Cat’s in the Cradle” may have made more grown men cry than any other song: The story of a father who’s too busy working to spend time with his son cuts to our deepest fears as parents.

Even Chapin himself has said that the song scared him to death.

If you have work that you’re personally invested in and a family you want to spend time with, though, there’s naturally going to be tension between the two as they battle for your limited time each day.

I have an amazing wife and three kids, but I also have two businesses to run. In the first couple years running my startup, vacations were rare, and frequently missing family meals tested my marriage and my character as a father.

The tension you feel as a working parent is not necessarily bad—but if you prioritize the wrong things, you may look back on these years with regret.

Thankfully, you are not doomed to the depressing fate of Chapin’s song simply because you have a demanding job. There are practical ways to make sure your schedule reflects your priorities. Here are four strategies that have worked for me:

Communicate with your spouse

One focused conversation about boundaries can create a compass that keeps you on a path to happiness at work and at home.

Sit down and make a “too much, too little” chart together. Write down guidelines for how much time at work is too much, how many missed dinners are too many, what is considered too little time spent on work, etc.

Protecting everyone’s needs starts with setting clear expectations.

Keep family life consistent

This is especially important with young children.

If dinner is family time, you should be a part of it. Likewise, you should be present at kids’ activities.

Too many career advancements at once can ruin family stability and throw your life into chaos.

Don’t justify slipping away by saying you’ll make up for lost time later on. You can’t and you won’t. Invest in your current relationships with your kids so you still have relationships in the future.

Share the burdens and the vision

Help your family see the value in what you do when you’re not at home.

Include your spouse on work trips, for example. Let your partner help you make business decisions and be a sounding board for you.

Let your spouse have the final say

For the most part, these strategies have helped me keep my work-life balance in check. But when all else fails, my wife draws a line I don’t cross.

She reminds me when I’m putting in too many late nights, taking too many calls during family time, or spending too much time on email when I should be with the kids. When I get so focused on work that I start to drift away from my family, she pulls me back in—and I let her.

We often say a good business is “like a family,” but remember that like a family is not the same thing as having a family. No business should replace your actual spouse and kids. It’s good to work hard and push your limits, but don’t go past them.

If you do, you’ll be tired and alone at the finish line, and there will be no one at home to celebrate with you.

Sam Bahreini, a seasoned operations officer and entrepreneur, is co-founder and COO of VoloForce, a company that helps enterprise retail brands understand organization implementation through automation and simplification.

Young Entrepreneur Council (YEC) is an invite-only organization comprised of the world’s most promising young entrepreneurs. In partnership with Citi, YEC recently launched StartupCollective, a free virtual mentorship program.

MONEY Workplace

Why Coworking Is Hot

shared workspace
Hero Images—Getty Images

These shared workspaces for freelancers, entrepreneurs, and other independent workers tend to feel hip, fun, and casual -- but their success is about much more than cool design.

Coworking spaces – where freelancers, entrepreneurs, and other independent workers pay a fee to share a workspace and benefit from working in the presence of one another – are hot. More than 160,000 people worldwide are members of over 3,000 coworking spaces, according to a recent report by DeskMag.com and Emergent Research, up from just 20,000 workers in 500 spaces in 2010.

My colleagues Gretchen Spreitzer and Lyndon Garrett and I set out to understand what draws people to coworking and what accounts for its success. We surveyed members from over 40 coworking spaces around the United States, analyzed the websites of over 100 U.S. coworking spaces, visited a handful of spaces in major U.S. cities, and spent several months as participant observers in one local coworking community in Ann Arbor, Michigan.

Given the coolness factor of coworking spaces – especially those that attract members with hip design and high levels of service – we figured that their design had something to do with the success of the phenomenon. But we wondered what other factors drove the success of the coworking model. Several interesting insights emerged.

Coworking fosters personal growth and community building

In his recent book, The Purpose Economy, social entrepreneur Aaron Hurst writes how coworking spaces are a powerful tool for cultivating community among a new class of workers who are driven to organize their professional lives around continuous personal growth, meaningful relationships, and the service of something greater than themselves.

One of the aims of the coworking movement is to provide people with a safe space where they can be themselves at work. But it also encourages members to explore shared interests with one another and collaborative opportunities that go beyond daily work routines. Grind, for example, a New York-based coworking space that participated in our study, offers tips to its members on how to move beyond their natural comfort zone and meet fellow members.

We also found learning to be a necessary component of what makes coworking a successful model. Member education is an explicit part of the mission of many coworking spaces. We saw spaces supporting member education, member support networks, and access to professional development opportunities and mentorship. Many spaces also host social events like happy hours, networking events, and guest lectures in order to reinforce learning and community building.

The most successful build “just right” communities

That is, just right in that they involve newcomers as much or as little as they want, without any pressure.

Unlike a traditional shared rental office where people largely want a quiet professional space to work without being bothered by others, many coworking spaces curate an experience that allows potential members to try the space and meet other members to see if there is a fit.

But unlike a traditional work organization that does this through the hiring process, coworking has low switching costs for members and doesn’t actually commit them to any aspect of the work experience that is meaningless to them. The result is that coworking gives a non-overbearing sense of belonging to those who want to be part of the community.

Coworking isn’t just for start-ups and freelancers

Although the earliest coworking communities were organized to provide an alternative to coffee shops or working at home to freelancers and entrepreneurs, we learned that coworking spaces are reaching diverse segments of the workforce. We found some spaces catering to writers and artists by emphasizing affordability and an atmosphere of creativity, for example. Others, including some of the most welcoming communities in our sample, attract women entrepreneurs.

But coworking also helps people keep good jobs with conventional employers in cases when, for example, they are forced to move for a spouse’s job change. In fact, 21% of U.S. sites explicitly market to remote workers, and one-third of our survey respondents were employed full-time by some other company. On average, these individuals are spending 65% of their time working from a coworking space.

“We have seen individuals who come in to avoid the commute to their traditional office space,” says Michael Kenny, managing partner of San Diego-based Co-Merge, a space that participated in our study. At Co-Merge, users from Accenture, Groupon, and Citrix are using the space on a regular basis. Co-Merge also has members who remotely work full-time for companies in other major cities such as Baltimore, Chicago, and Washington.

It’s the authentic sense of community where intrinsically motivated people who experience a sense of purpose in their work and thrive together that substantiates the coworking movement. Given these qualities, we expect to see a growing number of flexible workers try coworking — and a growing number of employers embracing coworking as a tool to help their increasingly mobile and flexible workforce to do their best work.

Peter A. Bacevice (@Bacevice) is a researcher with the Center for Positive Organizations (@PositiveOrg) at the University of Michigan’s Ross School of Business (@MichiganRoss) and senior design strategist with the New York office of HLW International (@HLWIntl). Gretchen Spreitzer is the Keith E. and Valerie J. Alessi Professor of Business Administration and Professor of Management and Organizations at the University of Michigan’s Ross School of Business. Lyndon Garrett is a doctoral candidate at the University of Michigan Ross School of Business.

 

TIME Innovation

Five Best Ideas of the Day: November 5

The Aspen Institute is an educational and policy studies organization based in Washington, D.C.

1. Beyond PTSD: Returning soldiers struggle to recover from the ‘moral injury’ of war.

By Jeff Severns Guntzel in On Being

2. On climate and so many other scientific issues, the way we communicate polarizes audiences. We can do better.

By Paul Voosen in the Chronicle of Higher Education

3. Entrepreneurs and educators need to observe students in school if they want to make real change.

By Alex Hernandez in EdSurge

4. Lifesaving ultrasound technology may soon come to a device the size of an iPhone. The applications for medicine in the developing world are massive.

By Antonio Regalado in MIT Technology Review

5. Many Arab governments are fueling the very extremism they purport to fight and are looking for U.S. cover. Washington should play the long game.

By Michele Dunne and Frederic Wehrey at the Carnegie Endowment for International Peace

The Aspen Institute is an educational and policy studies organization based in Washington, D.C.

TIME Ideas hosts the world's leading voices, providing commentary and expertise on the most compelling events in news, society, and culture. We welcome outside contributions. To submit a piece, email ideas@time.com.

MONEY Getting Ahead

How to Convince Someone You Admire—but Have Never Met—to Mentor You

New York Public Library
Kyoungil Jeon—Getty Images

A little bit of flattery and a lot of research can get you everywhere, says entrepreneur Travis Steffen.

Five years ago I was living in a cramped three-bedroom apartment in East L.A., trying to build two startups simultaneously with no clue what I was doing and no seed capital. I had very little income, no connections and, frankly, no friends. Nevertheless, I was determined to find a way to become successful.

I had recently attended an entrepreneurship conference and bought a DVD profiling young millionaires. One of the lessons from that DVD was to find a mentor—that is, a person who currently is where you want to be, who can take you under his or her wing and show you the ropes.

I hadn’t really made an effort to network with other entrepreneurs up until that point, so I couldn’t just call one up and ask for an intro. So, I carefully crafted a series of emails and follow-ups to all of the young millionaires profiled in the DVD I was watching!

Not only did I get responses, but I impressed one of them enough to agree to mentor me. This individual guided me when I needed it and eventually granted me access to her incredible network. I have since started, scaled and sold five companies.

The key to my success was simple. I didn’t want to blend into the crowd of others like me who I was certain were going after the very same entrepreneurs, so I set 8 simple rules for myself, as follows:

1. Do your research.

Before you seek out a mentor, know which industry you want to learn about, and in what way. Then, come up with a shortlist of people you’d like to target—and do your research on each. See if you can find their bios online; look for articles written on them; and check out their LinkedIn profiles.

When you do reach out, make sure your research is apparent. This attention to detail will show your prospective mentor that you’re not just blanket emailing a ton of people at once—that you actually want to learn from him or her specifically.

2. Don’t be desperate.

Many people seeking a mentor will resort to begging. They’ll talk about how they don’t know what they’re doing, how their company is failing, or whatever other negatives they think will demonstrate their need for a mentor.

However, just as a bank won’t loan to somebody who’s broke as they don’t want to risk not being paid back, successful people won’t mentor somebody they feel they can’t make an instant impact on as they fear wasting their time.

3. Show that you’re a self-starter.

You need to remember that the best mentors out there will often be the toughest to get.

To give yourself the best chance of success, demonstrate that you’re not starting from complete scratch, that you’ve made it pretty far on your own already.

If you’re an entrepreneur, for example, you’ve might explain that you’ve already got a business plan or spent a significant amount of time getting to know the industry. If you’re a career changer, you might show that you’ve taken some classes on the topic. If you’re looking to climb in the field in which you currently work, you might describe what you’ve done so far.

4. Demonstrate self-confidence.

Successful people were not always successful, but most of them were confident—even early on in their careers or entrepreneurship—in their ability to learn and become successful.

In your communications with your potential mentor, your ability and passion to make things happen needs to be apparent not just in what you say and do, but how you say and do it.

5. Establish specific, low-pressure terms.

Asking a successful entrepreneur, “Will you mentor me?” is akin to a man asking a woman he’s never met to marry him. He’s much more likely to be successful if he instead has a nice conversation and asks if he can call her sometime.

Approach a prospective mentor in the same way.

Don’t flat-out ask them to be your mentor. Instead, let them know that you really respect them and have learned a lot from what they’ve done, and then start with one specific question that shows you’re actively working on building your own empire. Get your first positive response, and then go from there—slowly.

6. Don’t create work for them.

When starting to work with somebody you want to mentor you, make it known that you’re aware how busy they are and how valuable their time is. Then propose something as simple as a 15-minute call once per month when their schedule permits.

7. Showcase your implementation.

There’s nothing more encouraging—and more flattering—to a successful businessperson than someone showing them how much they’ve learned from them, how they’ve implemented it, and the conclusions and next questions they’ve come to as a result.

After you ask your first question or two, don’t even think about asking anything else until you’ve implemented the advice they’ve given you and can show it.

8. Show your gratitude.

By and large, if you’re asking a successful person to give you their valuable time, you need to acknowledge that you understand that they are making sacrifice on your behalf.

While you likely don’t have much to offer them at this point, you can remember to thank your mentor each time you talk. But also show your appreciation in a unique way now and again, perhaps with a gift around the holidays or when they help you with a particularly challenging problem. I prefer something like Edible Arrangements as it shows how thankful you are without sending an inappropriate message.

Travis Steffen is currently the founder of UP (upshare.co) and one of the founders and VCs sharing their insight at MentorMojo, an entrepreneurial e-learning platform. Young Entrepreneur Council (YEC) is an invite-only organization comprised of the world’s most promising young entrepreneurs.

 

MONEY Small Business

3 Important Lessons Entrepreneurs Can Learn From Game of Thrones

Game of Thrones
Macall B. Polay—HBO via Everett Collection

There's a lot that real-life startups can take away from the Emmy-nominated fantasy series.

The acclaimed HBO series Game of Thrones—which is up for 19 awards at tonight’s Emmys—provides interesting commentary on the modern state of politics and warfare. But speaking as the founder of an online folder printing company, I’ve noticed that the show also demonstrates some valuable lessons for first-time entrepreneurs.

These might not help you become king of a fantasy kingdom, but they’ve been invaluable to me throughout my more than a decade of successful entrepreneurship.

(Reader beware: This article contains several spoilers.)

Lesson #1: Knowledge is power

In Westeros: The Game of Thrones characters who are most likely to survive are the ones with the best information: Where would Varys be without his network of spies gathering secrets from all across the Seven Kingdoms, for example? Would Cersei and Littlefinger still be around if they didn’t have dirt on their enemies?

In your business: Knowledge is your best asset. But that doesn’t mean you need to train swaths of children to uncover your competitors’ deep, dark secrets a la Varys. You simply must to get to know your industry inside and out, so that you can identify what it is that you can provide your consumers that others aren’t already providing. When you understand your field and the needs that aren’t being met, you’ll be better positioned to fulfill those needs.

For me, recognizing an unmet need was the impetus for starting my own company. After discovering that those seeking custom presentation folders faced extremely limited choices, I set out to provide materials of more variety and greater quality.

Lesson #2: Unearned confidence can be dangerous.

In Westeros: Pride often precedes a fall. Ruthless, arrogant King Joffrey mocks his enemies and abuses his subjects in a display of power and privilege, only to be poisoned at his own wedding. Viserys Targaryen shamelessly proclaims his superiority to the people around him, one of whom happens to be a powerful warlord who “crowns” him with molten gold. Even fan favorite Oberyn meets a messy, head-crushy end when he lets his careless bravado get the better of him.

In your business: Know the difference between confidence and an overgrown ego. Starting a successful business requires boldness, determination, and trust in your own abilities and resources, but be careful not to let it turn into hubris. Make sure your actions are grounded in fact or reason; check yourself against someone you trust before making any rash moves. Overconfident people take risks that they can’t afford, and they often don’t listen to their peers’ good advice (“Trust me, Oberyn, wear a helmet”).

Back when my company was first beginning, I did a lot of different odd jobs on the side. A friend of mine told me that I should concentrate on my core competency: custom printed folders. I didn’t listen to that advice, and it ended up losing my business money in the long run. Once I started concentrating on folders, the company grew much stronger.

Lesson #3: A good mentor helps secure your success.

In Westeros: Each of the Stark children has flourished with the help of mentors, albeit unconventional ones. Arya Stark learned swordplay from her “dance instructor” Syrio; Bran has developed his psychic powers with the help of mysterious companion Jojen; and even Sansa seems to have picked up some lessons in court intrigue from Littlefinger.

In your business: Reaching out to a mentor can be a little scary, since it means acknowledging your own weaknesses as an entrepreneur. But remember that the person helping to guide you probably achieved their success with the help of a mentor of their own. When you make the choice to work for yourself, the only people you have to turn to for guidance are those who have already done the same.

Many of my friends are successful business owners, so I make it a point to consult with them periodically. Learning from their experiences helps me to avoid common pitfalls and ensure that my company is running as efficiently as possible.

Mentors aren’t just there to make you feel good about the work that you’re doing, though; they should have enough experience to tell you when you’re doing something wrong. Sometimes the advice that you need most comes from someone as bluntly honest as the Hound—though ideally, your mentor will be a bit more supportive.

Can you think of more business lessons to be learned from Game of Thrones? Share your thoughts on Twitter, with the hashtag #GoTbizadvice

Vladimir Gendelman is the founder and CEO of Company Folders, an innovative presentation folder printing company.

Young Entrepreneur Council (YEC) is an invite-only organization comprised of promising young entrepreneurs. YEC recently launched StartupCollective, a free virtual mentorship program.

MONEY Small Business

The 4 Essential Traits You Need to Build Your Own Business

It's not enough to want to be your own boss. The founder of an advertising company explains the key qualities that go into being a successful entrepreneur.

Many people aspire to become entrepreneurs, but it’s not something that just anyone can do. To actually succeed you need more than a desire to make money or be your own boss. You need certain qualities.

Soon after I started my own business, Fortune Cookie Advertising, I began to identify crucial qualities that were fundamental if I wanted to succeed. While I had all of these four traits to some degree at the outset, I also had to consciously develop them over time.

1. A Clear Vision

This is the foundation of your business. Your vision may be based on a product, a service, or simply the desire to solve a problem for your customers. This is the “why” of your endeavor, and it must be relevant to the people you will be serving.

That’s why it’s not enough to want to be independent—your customers or clients don’t care about this. They care about your vision, which could be anything from wanting to build the most advanced computer operating system to wanting to find a fast way to deliver flowers around the globe.

Your vision may change, expand, or narrow over time, but you need to have one when you start. In my business, I started with the vision of being able to provide advertisers with an innovative way to get their message out.

2. The Ability to (Quickly) Pitch Your Business

If your business is straightforward, like selling books or changing the oil in people’s cars, it’s easy to explain. But some products and services are more technical or abstract. No matter what kind of business you decide to run, however, you should be able to describe it to prospective customers, investors, or even friends and family members in a few short sentences.

If this isn’t your strong suit, you might want to study the art of the pitch in terms of the movies. A screenwriter must be able to sell his or her idea to a busy and skeptical producer in a few minutes. Any new business owner should have the same ability. It shows that you not only know your business well, but can convince others of its value in language they can easily understand.

3. Persistence

Many of the most successful entrepreneurs in history failed at their first (and in some cases second, third, or more) businesses. Notable examples include Harland Sanders, founder of Kentucky Fried Chicken, Richard Branson of Virgin Atlantic, and even Bill Gates.

But perhaps the most famous example in history is Thomas Edison and his many attempts to design the light bulb. The quote “I have not failed. I’ve just found 10,000 ways that won’t work” is often attributed to him. Hopefully, you won’t have to be quite as persistent as Edison, but the principle is the same. Many new ventures fail or experience setbacks, but you cannot let this stop you from trying over and over again until you devise the formula that works—you won’t get paid if you don’t.

At one point in our business, a computer failure resulted in the loss of hundreds of names of contacts, including customers and prospects. This data, of course, should have been backed up, but I had not gotten around to doing this. So my team and I had to manually rebuild the entire list. It was a painstaking process, but we recovered everything, and I learned a valuable lesson: Always back up!

4. Focus

This last quality is one that entrepreneurs need in abundant supply. You need to be able to see a project from inception to completion while overcoming distractions. You must be able to prioritize, set your own schedule, and meet your own deadlines. For people accustomed to having their tasks assigned to them by employers, parents, drill sergeants, or professors, this is a big change.

When I first started my business, it took me a few months to understand this. At first, I made elaborate schedules and to-do lists to keep myself on track. I still do that to some extent, but now it’s more internalized as I’ve gotten comfortable in the role of entrepreneur.

Almost everyone like the idea of being independent—in theory. The freedom to be one’s own boss is one of the most desirable things about starting a business. But only you can decide if you are focused enough to do it.

Shawn Porat is the CEO of Fortune Cookie Advertising, a media placement company selling advertising space within fortune cookies at Chinese restaurants throughout the United States.

Young Entrepreneur Council (YEC) is an invite-only organization comprised of the world’s most promising young entrepreneurs. In partnership with Citi, YEC recently launched StartupCollective, a free virtual mentorship program that helps millions of entrepreneurs start and grow businesses.

More from the YEC:

TIME

Tinder, Women, and the Question Every Investor Should Ask

Natalia Oberti Noguera
Natalia Oberti Noguera Erica Torres

"Do you have a woman co-founder?"

In my time growing a network of women social entrepreneurs in NYC and leading Pipeline Fellowship (an angel investing bootcamp for women), I have heard of women founders bringing male employees to investor meetings in order to be taken seriously. But it hadn’t ever occurred to me that men would purposefully hide the fact that their founding team included a woman—until Tinder’s sexual harassment lawsuit broke last week.

When men approach me after a talk/keynote/panel to express interest in pitching Pipeline Fellowship’s angel investors-in-training, I ask them, “Do you have a woman co-founder?” I’m usually met with baffled looks, even though in my remarks I’m very clear that one of the criteria to apply to present at a Pipeline Fellowship Pitch Summit is for the business to be woman-led. Several men have answered along the lines of, “Actually, no, but I have a [female friend/relative] who volunteers [doing something at the C-level that sounds like a full-time job].” I usually reply, “Great! It sounds like she’s adding value and is part of the team, so, once you formalize that relationship by making her a co-founder and giving her equity, I encourage you to apply.”

Then, I spoke at Rosario Dawson’s Voto Latino Power Summit in NYC.

As I was heading into the auditorium to listen to Arianna Huffington, Rosario Dawson, and Voto Latino’s CEO Maria Teresa Kumar, I noticed a man and a woman walking toward me. The guy said, “My name’s Deyvis Rodriguez and I just wanted to let you know that I heard you speak at the pre-SXSW Latin@s in Tech event held in Austin a few months back and you asked me if I had a woman co-founder.” Deyvis went on to share that prior to our interaction, he hadn’t really thought about having or not having a woman co-founder. A few weeks after the event, a friend recommended someone who might be a good fit for his startup. That someone turned out to be the woman next to Deyvis: “Meet Leo Bojos, my co-founder at Stellar Collective.”

I was psyched. The little remix of the White House Project’s Marie Wilson’s “You can’t be what you can’t see” with the opposite of “Don’t ask, don’t tell” had worked. In that simple question—”Do you have a woman co-founder?”—men must acknowledge the lack of gender diversity on their founding teams, often for the first time.

While Justin Mateen didn’t get the #likeagirl memo, I bet there are many more Deyvis-es in our midst. Gender diversity actually adds value to a company, according to an Emory University study, which found that ventures with women co-founders were more likely to generate revenue than those with only men on the founding team.

In 2013, according to the Center for Venture Research, 23% of women-owned ventures pitched to U.S. angels, 19% of which secured capital. And only 7% of minority-owned firms pitched to U.S. angels, 13% of which received funding.

There have been many initiatives to encourage more women entrepreneurs, including seasoned angel investor Joanne Wilson’s Women Entrepreneurs Festival, Shaherose Charania’s Women 2.0 PITCH, and Natalie Madeira Cofield’s Walker’s Legacy, which was inspired by Madam C. J. Walker, the first self-made U.S. millionaire woman, who also happened to be black (disclosure: I serve on the advisory board). I launched Pipeline Fellowship to change the face of angel investing and create capital for women social entrepreneurs. Even Barbie has signed up to be an entrepreneur.

What if, in addition to getting more women to consider entrepreneurship, venture capitalists joined me in asking men pitching to them, “Do you have a woman co-founder?” (VCs, by the way, are not off the hook. Entrepreneurs, I urge you to ask them if they have a woman partner, which isn’t the same as office manager.)

And as an LGBTQ Latina who knows that 93% of businesses pitching to U.S. angels in 2013 were led by white people, I ask different versions of the question, such as “Do you have a person of color co-founder?”

Wondering where to start? Here’s a helpful resource.

 

Oberti Noguera is Founder and CEO of Pipeline Fellowship, an angel investing bootcamp for women. She holds a BA in Comparative Literature & Economics from Yale and was named to Latina.com‘s “25 Latinas Who Shine in Tech” and Business Insider‘s 2013 list of “The 30 Most Important Women in Tech under 30.”

MONEY Small Business

How to Fire Your Boss and Break Free of the Corporate Grind

140704_FF_ENTREPRENEUR_1
When you're the boss, you have a lot of responsibility—but also a lot of freedom. Kali Nine LLC—Getty Images

Want to start a business? Do these four things first, advises entrepreneur Adam Root.

Imagine spending your whole life building a golden tower for someone else to live in. You sew the drapes, build the furniture, and put the feast on the table. And then, when you’re 62, you check out entirely and go live in your humble little house.

Guess what? That’s what you’re doing at your current job.

Each day you go to work, you contribute your time and effort to building someone else’s dream, not your own. The only way out is entrepreneurship.

Of course, the demands and sacrifices of entrepreneurship aren’t for everyone. You’ll likely end up with maxed-out credit cards and sleepless nights spent in front of a computer. Meanwhile, working for others does come with some plusses—like the fact that each time payday rolls around, you know the paycheck will clear, and you’ll be able to pay your mortgage on time.

That sort of certainty is nice, but it’s a luxury that’s costing you your independence.

Since launching my own business last March, I’ve experienced a few “entrepreneurs’ highs” that reinforce the decision to work for myself. For example, when I closed enough business to hire my first employee, I was able to bring on a college friend as an engineer. Sharing the vision of the company in its infancy was incredibly rewarding. Plus, writing my first paycheck validated the business, and made me think, “I can really do this.” It was totally liberating.

If you’re thinking of giving up the security of your current job in exchange for freedom, there are a few steps you should take beforehand:

1. Write your life plan

Yes, it’s cheesy, but putting your life plan on paper gives you a daily reminder of why you want to jump ship and start your own business. A life plan is a set of instructions on how to go from working for a company to creating one.

But rather than the numbers of a business plan, you’re going to write about what’s important to you and what will make you happy as an entrepreneur. Think back to the jobs you’ve had. What parts of the work did you enjoy doing? What were you good at? What did you like or not like about the workplace and culture? Did you prefer flexibility or routine? Would you rather collaborate or work alone?

The purpose of your life plan is to find the sweet spot where your passions, skills, and preferred environment intersect.

If you’re lucky enough to do what you love in an environment you like with a boss who values your skills, that’s great. If not, it may be time to ditch your 9-to-5 and strike out on your own.

2. Write a basic business plan

A business plan isn’t, unfortunately, that valuable to investors these days. They want to see traction and paying customers. However, a business plan helps you do essential things like recruit employees and provide guidance to your team—think of it as a Constitution for your company.

Writing a business plan was the hardest thing for me to do. It was tedious and it didn’t generate revenue. But I needed it. I spent two years trying to figure my business out; and once I had a plan, it brought clarity to everyone involved and gave the business focus. Do it early to spare yourself wasted time.

You don’t need to go into too much detail, but you should at least be able to answer the following questions:

·What does your business do?

·What problem does it solve?

·How will you market your business?

·What advantage will you have over the competition?

·How will you make money?

Also, write down how many customers you plan to have month-by-month. Then, cut those numbers in half and triple your estimated expenses to get a better idea of your financial outlook starting out.

3. Determine your core values

Your business plan may change. Your collaborators may change. You might even shift industries entirely. But with a solid set of core values, you will create a culture that will attract top talent to help you solve these problems as your company evolves. Take the time now—while you’re most passionate—to define what type of company you’re going to be.

Here are a few of our core values:

1) Collaborate, don’t compete.

2) Champion ownership.

3) Commend risk-taking.

4) Communicate transparently.

After we closed a second round of funding, we hired a lot of new people, and it was hard to maintain our culture. We missed quotas and deadlines, and people started pointing fingers. By realigning the company with these core values, we held each other accountable.

4. Set a timeline

Pick a date on your calendar when you plan to leave your job. I recommend saving at least six months’ worth of personal expenses before taking the plunge. After you leave, remember to keep ties with the companies you’ve worked for. Burning bridges always does more harm than good and can come back to hurt your business later.

I jumped in headfirst, risk taker that I am. I paid for it—I didn’t have savings and had to beg my parents and in-laws for money. It was painful and embarrassing, and it can be avoided by saving in advance.

Taking these four steps will set you up for success, but entrepreneurship is still going to be tough at first. You’ll work for years for hardly any money while your friends with six-figure salaries and golden handcuffs tell you that you’re crazy.

But one day, the scales will start to tip in your favor, and that money will buy you freedom. And even though you’ll work harder than you ever have in your life, you’ll be working for you.

__________

Adam Root, co-founder and CTO of Hiplogiq, has managed teams in interactive design and development for Fortune 500 companies, midsize agencies, and startups.

Young Entrepreneur Council (YEC) is an invite-only organization comprised of the world’s most promising young entrepreneurs. In partnership with Citi, YEC recently launched StartupCollective, a free virtual mentorship program.

MONEY Love and Money

3 Questions You’d Better Answer Before Starting a Business with Your Spouse

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Defining your business roles early on can prevent fights down the road. Getty Images

Make sure you and your partner are in alignment on money, vision and business roles, says entrepreneur Allie Sarto.

When people find out that I’ve been running a company with my husband since I was 24, the reactions are always a mix of shock and wonder. “How does that work out?!” they ask us.

I’ll be honest: While it’s been a lot of fun, there have definitely been bumps along the road. We jumped in head first back in 2009 with no clear vision for what we wanted to get out of the company. We were both just along for the ride.

Now, five years in, I think I’m able to offer some advice to others who are thinking about doing something they feel passionately about with someone they feel passionately about. I’d suggest making sure you’re in alignment on these three areas before getting started:

1) How will you pay for expenses—your own and the business’s? This is arguably the most important aspect to be in agreement on from the get-go. Studies have shown a negative correlation between consumer debt and marriage quality; add in the stress of business expenses and a lack of steady household income because you’re both involved in the business, and you’re likely setting yourself up for trouble.

For every tale of an entrepreneur who makes it big after going deep into the hole with credit cards, there are dozens of other stories about entrepreneurs who are still struggling to pay off their plastic many years later.

What worked for us: We built up a six-month emergency fund before we ever left our jobs to start the new business. This absolutely saved us in the early days, since it took more than three months of hard work to earn a single penny for the new business.

Other couples I’ve talked to have had one partner stay in a full-time job while the other partner goes all in during the early days. This diversifies the risk and allows the couple to focus on building the company together without the stress of wondering how the bills will get paid. Once the company is to a point where business is consistent and the couple has been able to establish a safety net of emergency cash, both partners can commit to the business full time.

2) What is your vision for the company? A second point to be in alignment on before starting your business: your visions for your company’s future. How big do you want your company to become, and what types of sacrifices—typically time put into the business—are you willing to make to get there?

This vision will inevitably change over the years, so don’t discuss it once and consider yourself set for life. During the course of our business, we’ve had to make new decisions about whether to sell the business (we decided not to) and whether to slow down after having our first child (we decided this was the right choice).

3) What role will each of you play in the business? This may sound silly at first, but it’s important to set clear expectations of who will do what.

After meeting many other couples who run businesses together, I’ve found that in the most successful pairs, the spouses complement each other’s skill sets. For example, one is very business minded, while the other is the creative force behind the business. One might be great at managing the business behind the scenes, while the other is very good at managing client relationships.

I’d suggest making a list of roles that will need to be covered within the business, and then divvying these items out; that way, no one steps on anyone’s toes.

I’m not saying that answering these questions will prevent you from ever squabbling with your spouse about the business (if only!). But having the conversations early on can help you set the foundation for success—and prevent major disagreements from damaging your business or your marriage.

Allie Siarto is the co-founder of Fare Oak, an online women’s clothing company.

Young Entrepreneur Council (YEC) is an invite-only organization comprised of promising young entrepreneurs.

MONEY Small Business

Grow Your Small Business the Right Way

For entrepreneurs, the goal isn't merely to expand—it's to seek out new business that's truly worth your time.

For entrepreneurs, the goal isn’t merely to expand — it’s to seek out new business that’s truly worth your time.

  • Focus Your Strategy

    Even if it means turning away business.

    To create a business capable of blossoming for years, you’ll have to prune it from time to time. Working with customers or offering products that can’t achieve healthy profit margins can sap time and stifle growth, says Nat Wasserstein, managing director of Lindenwood Associates, which helps turn around small and midsize businesses.

    So thin out ventures and customers that bleed your energy.

    1. Figure out which services are worth it

    Giving clients what they want is important, but it should never be your only criterion for the products or services that you provide.

    When architect Bruce Wentworth considered expanding his 12-person company — Wentworth Inc. in Chevy Chase, Md. — he thought about what his firm excelled at: combining transitional-style interior design, which blends modern and traditional finishes, with detail-oriented construction. And he discovered there isn’t enough profit in projects below $50,000.

    “By the time we get involved in design, construction drawings, pricing, and permits, it’s not the most efficient use of time,” he says. The firm’s sweet spot is in the mid- to high-end market — kitchen remodeling, for instance, ranging from $70,000 to more than $300,000.

    2. Rank your customers by their “value”

    Pay attention to the quality of your clients: Are they high or low profit? Are they high or low maintenance? “You want to retain those customers who represent your highest profit margin,” says Yoon Cannon, founder of Paramount Business Coach, a small-business consulting firm in Pennsylvania.

    Even better: Find ways to cultivate more business from those clients.

    Start by calculating the “value” of each customer, according to what they bring in annual profits, revenue, and effort. To do that, use the worksheet on the next slide. Then rank them, and focus like a laser on the top 20%.

    3. Prioritize potential clients too

    In 2008, Harry and Barb Haagen, who run a house-painting company with six employees, began to worry when sales dipped by more than 10% in the economic downturn.

    The couple, from Doylestown, Pa., came up with a counterintuitive fix: They looked for ways that they could winnow the business even more. Harry recognized his strength was in craftsmanship, not low-cost jobs.

    So Barb, who handles the phones, began screening callers. To those interested only in price, she explained the added value Harry provides.

    If that didn’t hook them, she moved on, freeing up time to focus on customers willing to pay for premium services. The strategy has paid off: Sales are up 15% this year.

  • Target the Right Customers

    To determine which clients are most valuable, score them not just on profits, but on profits per effort, says business coach Yoon Cannon.

    Use the worksheet below to calculate each customer’s score value — then rank them, with the highest being the best.

    VALUE SCORE

    WORKSHEET

    Total revenue from Client X: $____________
    Cost of acquiring client*: $____________
    Total job costs**: $____________
    Profit for Client X: $____________
    ______________________________

    Total hours worked: _____
    Profit per hour: _________
    _____________________________
    Relationship bonus:*** +_____
    _____________________________
    Value: $_______

    * Tally up all the marketing costs: direct mail, presentations — even wining and dining.
    ** Include only materials, mileage, shipping, and labor (including your own) directly tied to that project.
    *** Aggravation counts, but so do frequency of work, length of relationships, and number of referrals they bring. Score clients on a 1-10 scale, 10 being best. Then turn the bonus into a percentage (5 becomes 50% or 0.50, for example) and multiply by profit/hour. The example below is based on a score of 10.

    EXAMPLE

    Total annual revenue from Client X: $20,000

    Cost of acquiring client: -$1,000

    Total job costs: -$13,000

    Profit for Client X: $6,000

    _____________________________

    Total hours worked: 100

    Profit per hour: $60

    _____________________________

    Relationship bonus: +$6

    _____________________________

    Value: $66

  • Attract the Growth You Seek

    Use these online strategies to target clients.

    Digital marketing can be a cost-effective way to stand out. Yet a recent survey found that few small-business owners think that using social media (11%) or search engine optimization (6%) is that useful. Don’t let such opportunities go to waste.

    Follow this checklist:

    Choose the right platform: Everyone uses Google AdWords to advertise online, but that can be pricey. The average cost per click in the business category was recently $1.98, according to a study by Adgooroo. For a cheaper alternative (91¢), try the Yahoo Bing Network.

    It’s no bit player. Yahoo Bing accounts for nearly a third of all online search in the U.S. And while Google generally delivers more ad impressions, Adgooroo found that the lead is not that great in four of six major categories: business, computers, education, and travel.

    In finance Yahoo Bing actually leads. Yet costs per click were 23% to 63% cheaper. For B2B firms, LinkedIn is another cost-effective ad platform.

    Select the right words: Seeking to grab customers using search engines to find businesses like yours? Incorporate strategically throughout your site words customers are apt to look up, says Heather Lutze, CEO of Findability Consulting & Speaking in Denver.

    One way Jeb Brooks, CEO of the Brooks Group, a sales training firm in Greensboro, N.C., identifies those words is simple: He asks clients when he meets them. One recent post on his blog was called “The Value of Public Sales Training: Getting Coaching and Ideas From Outside Your Industry.”

    Pick the right crowd: Social media is all about finding the right fit. Offer visually oriented services or products? Then Facebook, Instagram, and Pinterest are good places to hang out, says Evan Bailyn, author of Outsmarting Social Media.

    Interested in B2B? Then use LinkedIn and SlideShare.net, which let you introduce yourself to clients through posted research and presentations.

    Stand out visually: Use some of your Facebook budget to create videos, says Ben Landers, CEO of digital-marketing firm Blue Corona. Research by the social media firm Zuum found that videos were shared 11% of the time, vs. less than 3% for status updates and under 7% for photos.

    Track your results: More than half of all small-business owners fail to measure the results of their marketing efforts. So they don’t see what’s working and what’s not.

    Yet for just $200, Landers notes, you can hire a developer to customize the free Google Analytics program for you to identify the precise channel through which each visitor came to your website.

  • Finance Your Growth Wisely

    Be relentless when it comes to preserving your cash.

    If you grow faster than planned, even a momentary cash crunch can have a lasting effect.

    “Not stocking enough cash is probably why the majority of firms go out of business,” says Bill Klein, president of Consero Global, a financial consulting and outsourcing firm that works with small and midsize companies.

    To avoid a cash crunch, take a page from SpareFoot, an online search firm based in Austin that is trying to become the Hotels.com for self-storage space.

    1. Monitor your cash flow maniacally

    Part of making your firm attractive to a lender down the road is ensuring that there aren’t wide gaps between money flowing in and out. At SpareFoot, owners check their cash flow statement every day.

    Then they do something rather unusual: They let all of the company’s 88 employees look at those financial reports too, says CFO Lucas Walters. That way, when it comes to spending decisions, “everyone on the team is rowing in the same direction” — and focused on savings, he says.

    John Egan, editor-in-chief of SpareFoot’s website, agrees. “Because we know the financial situation and feel like we have a stake in it, we are careful with how we spend our money,” he explains. “If I have to book a plane ticket, I’ll look for the best deal. Why wouldn’t I?”

    2. Keep staffing costs as low as possible.

    Since labor is one of your biggest expenses, maintaining tight cost controls over your payroll will go a long way toward protecting your cash. Sure, you can always hire full-time staffers now and lay them off down the road should business slow. But that approach can get expensive, says Jaime Klein, president of Inspire Human Resources.

    SpareFoot’s owners avoided this by relying when they could on temporary workers and by outsourcing early on. When the company did need to add permanent employees, it tried them out for 90 days — without benefits — before committing.

    Today, as SpareFoot plans to increase its workforce to 96 by year-end, “we still evaluate every position to determine what solution makes sense, including outsourcing,” says Walters, who himself started out as an outsourced CFO for the firm before joining permanently later on.

    3. Line up financing before you expand

    The time to position yourself for a low-interest bank loan isn’t when you’re running out of money and struggling, says Klein of Consero Global. Obtaining credit is a lot like landing new customers. You have to invest time and effort to build a real relationship with potential lenders — and you have to cast a wide net.

    SpareFoot’s owners did just that. They kept deposits in several local banks for years knowing that they’d eventually need financing for expansion. That day came in 2012, when the firm required a seven-figure loan to pay for two acquisitions (one of which it did not complete). By maintaining relationships with lenders for years, says Walters, “we got the loan on more favorable terms than we could have otherwise.”

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