Should I Start a Business This Year? Here are 5 Questions to Ask Before Starting a Business or Side Hustle in 2023
It’s almost like a trend. A fad. I don’t know if it’s because I’m a business owner who finds business and side-hustle tips really insightful on social media — but I keep getting business and side-hustle related content on my socials. I’m bombarded…
Something that I find a little bit frustrating is that a lot of creators who are pumping out content are making it seem as though it’s easy, and that success will come quickly if you “just follow their 5 steps and buy their course”.
But let’s not be all doom and gloom about this. I think it’s amazing that resources, support and advice for aspiring business owners is readily available than ever before. The thing that makes me grit my teeth is that people buy into these things and step into business expecting to become a unicorn.
Unicorns ($0 to $1 Billion) do happen — but that’s the exception. 98% of us are going to fall into the category of needing to develop a strong brand, a quality product / service, find the right audience to serve, then strategise, implement, innovate and persevere (repeat). Starting up a side-hustle is one of the most rewarding, exciting, challenging things you might attempt to do.
It’s not as glamorous and easy as Youtubers, TikTokers and Instagram Influencers may make it seem. If you’ve been thinking about starting a side-hustle in 2023, make sure you ask yourself the following questions.
1) Why do you want to start a business or side hustle this year?
This probably sounds too simple at face-value (like, DUH — I want more money). But as simple as it seems, your vision, mission and purpose behind building a business will be it’s bedrock foundation.
Why do you want to start your business or side hustle?
What’s your goal? What are you hoping to gain?
Do you want to build a big franchise? Why?
Do you want financial freedom? More freedom with your time? Why is this important to you?
Does the title CEO sound glamorous to you? Do you want to drive a Ferrari or Tesla?
I bombard you with these questions because building a business is difficult. It’s going to be hard. You’re going to face challenges that if you’d known about before starting — you might have avoided it. There will be times you’ll question yourself, question everything about your business — and want to pull the plug.
I ask you these questions because you’re going to need to remind yourself of the reason why you started. Your “why” needs to be strong. It needs to be compelling. It needs to drive you, and motivate you to keep going when the going gets tough. Because the going will get tough. Beyond what you’d comprehended.
Your “why” needs to be really clear, and meaningful too. Otherwise it’s going be too easy to call it quits.
Your “why” needs to be solid, because somewhere down the track, you might need to make decisions (big or small) to pivot.
If you decide to grow your business to become more than just you (i.e. you hire staff and build a team) — you’re going to need to outsource talent and focus on what only you can do as the business owner: lead and drive the vision of your company.
Find clarity around why you want to build a business, and be really confident about the deeper reason behind why you want to start. It needs to be important to you personally.
2)Do you have a Clear plan and roadmap for your business idea?
This is where you need to create a business plan. It can range from a 1 page A4 document, to a 30 page PDF file that documents the DNA, Vision, Goals, Financial Projections, SWOT Analysis and other important details of your busines.
Business plans aren’t the end-all-be-all. I mean, you don’t need a perfectly refined business plan in order to start building your business.
I’ve had friends who told me that they would only properly start their business once they’ve refined and perfected their business plan (which means they’d never start their business, because their business plan would never be perfect). I personally don’t think that’s the best way to approach a business plan. At all.
It’s important to write a business plan as it gives you a clear map, structure, prospective budget and goal of what you want to build and why.
A solid business plan will answer questions like:
What is your product or service? Do people want it?
How do you know your idea will work? Have you tried and tested your product or service?
When you launch, who will be your target market? Do people search for your product or service? How do you know if there is demand? Who is your ideal client?
What will the structure of your business be? Will you start as a sole trader and transition to a Pty Ltd. or company? Do you want to start your business as a partnership with one other person? Have you researched the legal and financial implications of each of these options?
How much money will you need to start buying inventory, assets, invest in marketing, build a website and cover start up and operational costs?
These are a few of the many important questions that should be written out in a business plan. It might seem intense, but it’s important to have clarity around how you want to build the foundation of your business.
It’s like a reality check that becomes a blueprint or map for where you want to go. Things might change overtime, but the business plan will be a guide that you can revisit, reassess and pivot as you need over time.
3) Have you Assessed your Risk:Reward Ratio?
Take a reality check. I’m going to be a broken record about this. Starting a business is not a glamorous, easy ride. There are real challenges and real risks. Just like how investing in the stock market, cryptocurrency, or real estate can be risky — running a business is a different type of investment that involves its own risks.
What happens to your business when the world closes down and you can’t operate face to face anymore?
What happens when inflation hits and your product or service isn’t “essential”?
What happens when your staff members quite out of nowhere? What if a handful of well-paying client decide to discontinue working with you for various reasons?
What happens when your business cash flow becomes negative and you can’t afford to pay your bills, your staff or your lease?
What will you do if there is a big financial hit that you hadn’t planned, budgeted or forecasted for that you need to deal with?
How much are you willing to risk to start, build and grow your business? How much are you capable of risking?
Any great thing requires grit, patience, tender care and a solid plan. It is a risky venture that will take up a lot of mental headspace, money from your bank account and present consistent uncertainties. Are you up for the risk?
The consistent pay-check that a 9-5 day job provides can bring a lot of stability and freedom in everyday life, and be incredibly beneficial when applying for a property, credit card or bank loan. It can difficult for a “bricks and mortar” small business (with a commercial space) to break even, or become profitable in the first year. With the costs of the lease, paying staff, etc. the net profit of your business might not be substantial enough for you to even pay yourself in the first few months or years of operating.
The glitz and glamour that is often conveyed by the word “entrepreneur” isn’t always an accurate description of what the job entails. Entrepreneurs are high-risk takers, able to make calculated decisions based on what they envision their business could grow into. Mistakes are a part of the process, so business owners often learn through trial and error. But they’ve got their head deep in the game. They’re action oriented, embracing risks with caution and courage.
4) Do you have a Strong Support System?
It’s really important that you surround yourself with the right people, who can give you the support and encouragement that you need as an entrepreneur.
When I used to think of business people, I thought of men in a suit and suitcase networking with other men with suitcases talking about the economy, stock market, business merges, etc. I thought that would be the most important relationship that entrepreneurs would have (apart from their relationships with clients and customers). But my perception of entrepreneurs (and who they should surround themselves with) is completely different today.
They say that it takes a village to raise a child. They also say that it’s not fair to expect your romantic partner to be your: parent, friend, counsellor, coach, lover and confidant all the time. In the same way, building a strong, diverse support system is the best way that you, as a business owner can stay grounded, feel supported and stay in your lane for the long game.
As a business owner, the nature of your job is most likely to be high intensity, requiring you to wear a lot of hats and put out a lot of fires (some of which you may not have started yourself). It’s important that you have different layers, levels and people for support.
Do you currently have strong friendships and relationships with the people around you? Will you be able to keep in touch with them as you start your business venture for encouragement, advice, emotional support and just pure enjoyment (work aside)?
Do you have staff, other freelancers, or other people that can practically help you with tasks and jobs? Delegating and building a solid team is important when it comes to feeling supported when running a business, even if this just starts with family members or friends volunteering to help lighten the load.
Are you willing to find a business coach or mentor with more experience and wisdom in the entrepreneurship space to guide you? Business coaches and mentors can be an invaluable investment. Coaches and mentors both play different roles. In a nutshell, they can help you address your limiting beliefs, give you advice and give you the tools to proactively take bold actions to achieve your goals,
Support can also be found in the form of online training tools, leadership programs, business podcasts, blogs and video resources that are free, or paid.
Establishing strong relationships with our loved ones alongside investing time and energy into staff members and contractors we can trust, reaching out to financially in solid business coaches and/or mentors who we’ve built great rapport with and seeking out educational, inspirational resources online or in person are a few ways you can build a strong support system that will keep you from feeling lonely and overwhelmed to a breaking point when times get tough.
Reaching out for support when shit hits the fan is crucial, but prevention is always better than cure. The more you cultivate these different relationships when times are good, they’ll have your back when things get catastrophic. Which they might (smile).
5) Do you have Life Outside of your business?
This one might have made you think “duh” - but hear me out. It’s really important that you prioritse your health and wellbeing before your business. It’s really important that you prioritise your self-care.
Prioritising self-care can sometimes take the backseat (the very most back seat) when things get demanding and busy starting up and running your business. I imagine that it might be similar for parents.
It can be easy to neglect eating a healthy meal and option for deep-fried, sugary takeaway because it’s faster and more convenient. You might have broken, or very short amounts of sleep due to long work hours and perhaps due to stress. Spending time with loved ones and doing the things you love might also be shelved for prolonged periods of times.
But as your schedule becomes busier, and work demands become more full-on, it’s actually more important to invest in non-business related hobbies and make extra effort to see the sunrise, meal prep eat wholesome foods, prioritise a phone call with a loved one, and go for a walk. Because these are the things that will keep you grounded, laughing, and enjoying life. These are the things that shape your passion, drive and outlook on life. These are important to make non-negotiable in your schedule each week.
Spending time doing non-business related activities in your spare time can also boost your performance at work and give you a freshness when approaching challenges, or brainstorming innovative ideas to action.
At the end of the day, you are more than your business. Your wellbeing is more important than the success of your business because the health of a business will always reflect the health of the owner.
Starting a business is an awesome, noble thing. But it comes with layers of challenge and complexity alongside the brilliant reward that you can reap from your hard work and grit. If you’re thinking about starting a business in 2023, I take my hat off to you!
I hope you can ask yourself these 5 questions before you go forward and start your new venture. Good luck!
