Very few business owners expect their business to support them right out of the gate. More often than not, the expectation to receive income from outside the business gives the owner a false sense of security and a lack of real intentionality to build a business. We assume it’s supposed to be this way, and if we look around at other business startups and some of the really awful advice we get, we’re told it could be 18-24 months before the business even breaks even. So we take that 18-24 month window and use every bit of it, burning through outside money like there’s no tomorrow, and feeling just fine about it because it’s supposed to be this way.
A great friend of mine and fellow business advisor in Virginia, Eddie Drescher, told me about one of his clients who had one fitness franchise open and was about to open another. The national franchise had told him it would take 12 months or so to be profitable because that’s how long it took them.
As this client was about to open his second center, he told Eddie about this timeline. Eddie immediately challenged him, saying, “Who made that rule?” After talking through it at length, they decided to shoot for profitability in the first three months. Instead the location turned a profit in its first month, and stayed close to break even in the following few months. Rather than burning cash for 12-18 months because he was “supposed” to, he intended to do something much better much sooner, and did so.
Speed of Execution
I believe strongly that the number one indicator of success in an early stage business is not how good your product is, or how smart your marketing is, or your uniqueness, or your funding, or any of those traditional ideas of what makes for success. The number one indicator of success in early stage business is simply speed of execution.
Think of that successful six figure sales person you know, or that business owner who seems to turn everything they touch to gold. Almost certainly they are people who, when they get an idea, move on it immediately. Most of us spend way too much time thinking, researching, and planning. We would be better off getting a very basic plan in place and acting on it, and perfecting it as we go.
It’s the subject of my next book, but for now I can’t encourage you enough to just get moving! Stop thinking about starting up, and if you’ve started up, stop thinking that it’s supposed to last until the end of your cash, then magically switch over to funding itself.
Get intentional about getting your business through startup as quickly as you can. And whatever stage of business you’re in, keep Speed of Execution as one of your top business principles. You’ll make more money in less time.