Although owning a small business is a great way to find financial freedom for many, that doesn’t mean you should look at it through rose colored glasses. To underestimate the experience may be the key to failure so let’s take a look at those three myths and how to turn them in to success as you plan to open your new business.
#1- There’s tons of Funding Available
If you listen to Washington, you would think that all you have to do is call somebody and money will start pouring in to your business. You may have heard about the Small Business Association and the many new initiatives that have recently become available but the reality may be different. In fact, startup funds are hard to find. Venture capital and angel investors won’t be interested until your business is well along in its growth and banks will be wary of making loans if you don’t have a proven revenue stream.
Start with family and friends. Read this article (LINK) to learn more about that.
#2- You Don’t Need a Business Plan If Your Business is Small
Can you imagine if a carpenter built a “small” house without a plan? Every business, regardless of its size, needs a business plan, not just for others who may be interested in your business, but for you. If you’re going to build a business, you need a plan. There will be enough surprises along the way even with the best business plan. Minimize the surprises by having a well laid out plan that includes funding requirements, timelines, and goals.
There are many free business plan templates online that can assist you with building your plan. Look at a few of these plans and adapt to your needs.
#3- I will Get a Lot of Expenses Back in Taxes
It’s true that there are a lot of initiatives designed to minimize the startup expenses that come with starting a business but starting a business for tax purposes is like owning a home for the mortgage tax write off. You’ll get some of your money back in tax breaks but only a fraction of it. There’s no way around the fact that starting a business is full of financial risk. Before spending large amounts of money on your business, research and understand the tax write offs that may apply to your business.
It’s true that there are a lot of advantages to owning your own business but don’t go in thinking that it will be easy. The most successful small business owners work exceptionally hard. As the business becomes more established over time, the work may subside.