Starting a Business is Not as Risky as you Think
How risky is starting up a business? Some would say that starting a business is about the riskiest thing you can do. It certainly feels risky to leave a weekly wage for the unknowns of a business. Then there’s statistics that most fail. Not to mention the stories of bankruptcy and failed dreams. And yes, all that happens. Usually, it’s the result of one fatal mistake, over capitalisation. Backing a new business with huge debt. And yes, that is super risky and foolish. Don’t do that. Start a low cost, low capital, no debt business, where failure will not be fatal. Never invest or take on costs that you can’t easily cover. Don’t invest anything you won’t be able to lose without losing sleep. If you do that, starting a business is a risk worth taking.
Let me suggest a simple, low risk approach. Turn your skills, abilities, ideas or hobbies into a business. Whatever you do, can become a simple, effective and profitable business. Good at admin? It costs nearly nothing to start your own virtual assistant business. A business that can grow and hire more assistants and generate plenty of profit. Got a trade, you can turn that into a business with little cost but the tools you already have. Good at IT, there’s a business there with only your know how. If you can do sales and marketing, there’s heaps of businesses there. Have a hobby, why not sell products to other enthusiasts. Behind everything you buy is a business, behind every service you use is a business. And there’s no reason why you can’t create a low cost, low risk business. No need to spend tens of thousands of dollars. Start small, low cost, simple businesses. Done this way starting a business is a risk worth taking. If it fails, no worries, but if it succeeds, there’s huge benefits. Let me mention a few.
Benefits of A Business
I’ve previously posted about the benefits of a business here. But let me give you just a few. For starters you get to be the boss. And being the boss is good! You get to keep the profits and not watch someone else reap all the benefits. And best of all, the earning potential of a business is unlimited, with constant ability to grow and expand. At the end of the day you can be an employee, or you can be the owner. And typically, the owner is better off in the end. Almost always I would suggest. And the only way you get to be the owner is to start it. You also get to hire others, create employment and build something of significance. All that means starting a business is a risk worth taking. That said, there are some downsides we’ll get to soon. But let me share a bit of our journey.
Our Journey So Far
Getting Started a Low Risk Business
A couple of years ago we started a few businesses. I was convinced that a business has the best potential to earn a growing income. So we gave a few a go to see what would work. One folded completely as a result of the pandemic, one plods along without much attention, but the other has grown significantly and become the primary source of our income. It was a bit of trial an error. None of the businesses required a great deal of investment. No more than a few thousand dollars. And the most lucrative one was started with about $60. Like all business we started out doing all the work ourselves. We delivered the service, did the admin, sales, billing and everything in between. But as the business has grown we got too much work for us to do. So we hired one person and then two and now we have about 40 staff and hire more most weeks. We don’t do any of the service delivery and just manage the business. The next step is to hire managers, sales staff and bookkeepers, something we are in the process of doing.
At first we made enough live off, just. But now we are able to earn more than we ever did as wage earners. Our standard of living remains the same, of coarse. So all that means is significantly more savings and a retirement age a good decade earlier. More than that we have a business asset with significant resale value. And the business continues to grow quickly. Our annual turnover moved from around 30 000 to over 800 000 and continues to grow week to week. And that’s during a pandemic. We’re pretty glad we took the risk to start a business!
The business area we went into was low cost to enter and highly competitive. It was a basic service industry that’s been done for centuries. So there’s no need to reinvent the wheel, just do something someone wants. We don’t do it better or cheaper, we just do it the best we can. It’s not sexy, but it works. And it was low risk. If it failed we would have lost virtually nothing, other than some pride. It was little risk, with a lot of reward.
What About the Hard Stuff?
Now it’s not all margaritas and beach holidays. Anyone who’s done this will tell you it’s hard work. There’s stressful weeks, long hours and just plain hard work along the way. But the reward at the end is pretty good. Eventually we will have a team doing it all, from accounts to sales, HR and service delivery. The business will grow and we will have our holidays and do high level management. But getting there is a lot of long days and nights and not a holiday in sight. Business is 7 days a week for the first few years. But now we can see ourselves slowing down. Some I know have done it while on a holiday at the beach, but I just wouldn’t expect it. Starting a business can be low risk, but no low effort.
A Risk Worth Taking
All that to say, starting a business isn’t as risky as it sounds, if done wisely. In fact, it has massive earning potential with relatively little risk if you don’t over capitalise. And that is a risk worth taking. So if you’re sitting there thinking of starting a business, why not give it a go. You can start small, really small and let it grow with time. You can start it with the safety net of your current job. It might just grow far quicker than you think, that was certainly our experience. Starting a business is a risk worth taking. Nothing else has the earning potential. Nothing else can speed your potential to early retirement as a massive increase in your earning ability. And only a business can do that. Nothing can take you from struggle street to easy street in as little a time.
And it doesn’t need to be some amazing, unique idea; just do anything that’s been done before. Nothing sexy, anything that someone will pay for is fine. There’s plenty of space for you to jump in. So why no take a little risk? Why not do something that will make you the boss? Something with unlimited earning potential? Something to turbo charge your savings capacity. Now that’s why starting a business is a risk worth taking. Be wise.