Don't Do What You Love When Starting Your Own Business
Starting Your Own Business Calls for Open Eyes
One of the most common pieces of advice to those who are thinking of starting a small business is to do what they love.
I've even given this advice myself. (Have a look at Top 10 Tips for Starting a Small Business That Will Succeed, for instance.)
But years of advising people who want to start their own businesses and watching them go through the start-up process has taught me that I was wrong.
Or, at least, (being kind to myself), for many people, this advice is misleading.
Particularly when you are at the stage of starting your own business where you're casting about for ideas and deciding what kind of business you want to start, choosing to start a business based on what you love can lead you on a path headed entirely in the wrong direction - or even over a cliff.
You should not do what you love because:
1. Love is blind.
I know it's a cliché, but it's also true. Think about the last time you were "in love" with a person. Magical, wasn't it? But time passes, as it always does, and suddenly you start noticing things about your beloved that you never noticed before - things that are not only not enchanting but irritating and maybe even off-putting.
The same emotional journey occurs when you fall in love with a particular business idea or type of business. For example, you might love the idea of starting your own Bed and Breakfast. You envision yourself sitting in the sunny dining room of your B&B chatting with your fascinating guests.
If you actually did open a Bed and Breakfast, you would find that you probably didn't have time to chat with anyone because you were too busy making, serving and cleaning up breakfast. You might even discover that you dislike preparing breakfast for other people.
Love sugarcoats your vision and blinds you to defects.
You need to know what operating the type of business you choose is really like, not what you think or hope it's like.
2. Love tempts you to take shortcuts.
Another reason love and starting your own business don't mix is that we tend to assume that other people will love who or what we love. Who hasn't experienced the bewilderment of realizing that a person who’s important to us dislikes a loved one? It's an uncomfortable situation that can lead to hurt feelings and even the loss of a friendship.
When you start your own business based on what you love, the assumption that other people love it too can be downright dangerous. When you forge ahead, starting your own business without doing the research that would discover whether or not other people love what you love, you're literally gambling with your livelihood. What if they don’t and you've invested all your savings, for instance, or remortgaged your family home?
Every business idea needs to be diligently researched and examined to see if it actually presents a profitable business opportunity. Think you'd love to do whatever it is you're thinking of doing a business? Write a business plan and see if the idea actually has any merit.
3. Love makes you irrational.
When we're in love, we tend to see everything from an emotional point of view, rather than a rational one.
That's why we describe it as being "head over heels". It's certainly not a good state to be in when you're starting your own business and trying to choose the business idea or existing business that will be best for you.
For example, the other week I heard that a small local coffee shop was for sale. I had to go see it as I've always loved the idea of running such a place. And physically, the coffee shop was no disappointment; it had all the atmosphere and accouterments I had hoped for, right down to the funky carvings decorating the walls. My heart was pumping! I could see myself dishing up delicious lattés and cappuccinos to an appreciative crowd.
Now if I had let my heart lead me, I would have bought that coffee shop. Fortunately, I didn't. Instead, I sat down and did some research so I could do a business valuation.
(See 3 Methods of Business Valuation.) I soon discovered that the business was considerably overpriced. Rationally, buying it would make no sense.
4. Love makes you overly optimistic.
Starting your own business is no small commitment. Doing what needs to be done to get your new business started and develop it into a thriving small business takes years in many cases. Very few small businesses are a financial success in their first year. Some, as you know, never are.
The danger of being in love with a particular idea or type of business is that it makes us overly optimistic as to a business's potential. We tend to romanticize our prospects. You can start any kind of business anywhere. But will it succeed? And (a question that is just as important) how long will it take for the business to actually turn a profit?
You can't know for sure before your new small business starts, but you can develop a pretty good guesstimate by working through your start-up and operating expenses and doing cash flow projections. (See The Financial Plan Section of the Business Plan and 3 Methods of Sales Forecasting for details on how to do this.)
I'm always surprised by how many people are reluctant to "run the numbers". You have to do it, though, if you're going to get any realistic idea of a business’s potential success.
You Will Need Passion When You're Starting Your Own Business
Don't get me wrong - there's nothing wrong with passion. Passionately believing in your product or vision makes it a whole lot easier to put in all the hours you need to put in to start your own business and grow it into an enterprise to be proud of. But you need to rein in your passion when you're trying to decide what to do where and how. When it comes to starting your own business, passion is for the building stage, not the choosing a business stage.
So don't choose to start a small business based on what you love. Instead, choose something related to your interests that other people are going to love - or at least like enough to pay for.
Remember, Cupid is cute but he knows nothing about business!