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Is there a more beloved job title than “entrepreneur” at the moment?
Entrepreneurs seem to be worshipped as heroes (Elon Musk, anyone?), despite the fact there isn’t a person on earth who built a successful business on their own.
Because of this, and the current state of the world, being self-employed has never been more attractive to many people. As someone who has started and run her own businesses for over 10 years, I get the attraction.
Freedom to work where and when you please, creativity to build a product you have dreamed of, an opportunity to change the world and build a team of people as passionate as you are to do it.
As a commitment-phobe, I loved the idea of a freer lifestyle with no two days the same and I was driven by the idea of changing the world for the better.
But I think sometimes people skip over how hard it is and focus only on the glamour of entrepreneurship, without the realities of running a business being contemplated.
Most people know that most small businesses fail – 20 per cent of them within the first 12 months and over 70 per cent within a decade.
The fear of failure should never be a reason to completely discount the idea of striking it out on your own, as the rewards can be immense and failure shouldn’t be viewed as the worst thing that can ever happen. But it should be an indicator that business shouldn’t be entered into without too much thought.
Of course, eight years ago when I started Ethique, I didn’t think like this. I had just sold two other businesses (micro, micro businesses) that I had started in my late teens/early 20s and I wasn’t sure what I wanted to do.
Without question, I didn’t want to work for anyone else (though I was completing a science degree at the time, I couldn’t see myself trapped in a lab all day either). And I have always wanted to spend my life protecting our environment.
So Ethique was born from my firm belief that business is the best vehicle to create faster, longer lasting positive change. Government is slower as they have so many more hoops to jump through before achieving anything.
The Ethique story is one you can find in plenty of places should you care to look, so I won’t detail it here. Instead, I thought I would share some of the pieces of wisdom I collected from much cleverer, much more experienced people than myself over the early years.
Be different
This always blows my mind, but so many people start businesses that have no definitive difference from others in the market.
This is even worse in a super-crowded market, and yet I see it all the time. I get asked to mentor people and I love to do it, but this is one of the first questions I ask and easily 50 per cent of people cannot give me a real reason that I should buy from them and not their competitor.
If you, as the founder of your company, cannot articulate why you are different to everyone else, how on earth is your potential customer going to (note I say different, as better is a matter of perception)?
A difference doesn’t have to be something major, like some grandiose purpose or an innovative product that no one has ever seen before. Even something like price works well (there are plenty of examples of massive brands that market themselves exclusively on price). It may not be as persuasive to some buyers, but you need to think about this in terms of your target audience (and no, a target audience is not 20-40 year old women – narrow it down).
Have a purpose
The above leads nicely into my second favourite: have a purpose. Again, a purpose doesn’t have to be grandiose, à la Patagonia who is “in business to save our home planet”. But if you have a purpose, beyond just padding out your wallet, you will engender greater customer loyalty, inspire a team (a business’s number one asset) and ensure media have much more to talk about.
Ethique got a LOT of press from all over the world in the early years (and still does now). Why? We are bold about our purpose, deadset on our values and very authentic. Reading about a bar of shampoo is boring. Reading about a company that wants to rid the world of single-use plastic and inspire other businesses to think the same way has much more cut through.
Protect your brand
Want a big brand? Plan for it now and start building some foundations for it.
You may not have the money to start investing in trademark protections around the world, but take it from someone who learned the hard way, it’s much harder to fix it years down the track. There are several ways of securing your intellectual property (IP) for the future, so have a chat to an IP lawyer for a couple of hundred dollars and see what you can put into place from day one.
Plan!
Of all people in the world, it’s odd that I am saying this because I vehemently hated the word up until about three years ago. I remember thinking a business plan needed to be a staid, corporate document 50 pages long that locked you into a plan for the next three to five years.
Worst of all, no one ever read them. Maybe some people do it like that, but a plan can be as simple as one page outlining what you want to do and why. Corporates like vision and mission, but I am a huge fan of the Simon Sinek “golden circle”.
Picture a dartboard with three circles. The innermost circle is your “why” (refer to point number two – this is your purpose). Out from that is “how”, this reflects point number one, what makes your business different. And the easy one is “what. Start from your why and work your way out.
For example, Ethique exists because we believe business is the way to lead faster, more sustainable change that is better for all people and the planet equally (our “why”).
“How” is the multitude of differences between us and our competitors, like being palm oil-free certified, carbon neutral, home compostable and donating 20 per cent of profit to charity.
“What” we do is the simplest – we sell plastic-free solid cosmetics like shampoo, conditioner and body lotion. Most companies can nail the what and the how. Fewer can articulate their why.
Get support
My last big point is sometimes a bit counterintuitive. Get support, but be careful who you listen to.
Loads of people will offer their help and this is a very sweet gesture. I don’t know if it’s a uniquely New Zealand thing or if people just like helping entrepreneurs, but you will be overwhelmed with people who want to give you advice based on their life experience.
Listen to it and take what you want to, but don’t discount everything you fundamentally believe to be true just because someone with more experience (possibly) says things can only be done one way.
We have been told from day one that many of the things we do are impractical or impossible. That home-compostable packaging won’t stand up on retail shelves, that donating 20 per cent of profit is unsustainable, that I need a bigger board (I don’t believe a top-heavy organisation has ever helped anyone) and that I shouldn’t use equity crowdfunding to raise capital.
None of this advice (and much more) has ever panned out to be true, but it’s a reflection of the prevailing (often outdated) business advice that is out there that people believe to be absolute. My COO and business partner Tristan has repeatedly told me that business is simple but people overcomplicate it, and this is so true.
If something someone is telling you is fundamentally in opposition to what you believe, you don’t have to do it. It’s tempting as an inexperienced person to simply take advice blindly, but that can lead you astray, as no one knows your business and your goals like you do.
So, in essence, don’t go into your new business blindly, focusing only on things like your new business cards or the colour of your website. Do some planning, do some research, but don’t get bogged down in it.
You can have the best product and the best business plan in the world, but if you don’t actually get started, it will go nowhere. And that bit seems to be the point that lots of people get stuck on. What do I do first? How do I actually start?
And here I always go back to my favourite famous phrase (attributed to several different people): How do you eat an elephant? One bite at a time.
Start with something small you can tackle, like building a website (easier than you might think) or reaching out to a colleague to get some feedback (though be careful with your IP). Once you have taken that initial step, you will grow in confidence to take the next. Then the next and the next. If a task seems monumental, break it down into pieces so it’s achievable.
If you are starting a business in 2021, I wish you all the best!
