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

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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.

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