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Let’s demystify the perceptions and myths around entrepreneurship based on my personal experience building and growing a startup.
I have been an entrepreneur for the past five years. I have tried a bunch of things and I have failed in the past. A lot of people think that I am an entrepreneur because I want to make money, or I want to create an impact. Yes, those reasons are included in the list. But the most important reason why I am an entrepreneur is that I do not know what else to do.
Nothing else is challenging enough for me to keep my mind engaged. That’s why I do what I do. But it is also very difficult to do this. It is challenging and soul-crushing to run a startup. Let’s look at the top five challenges that entrepreneurs face in their journey.
The biggest challenge that entrepreneurs face is not from the outside. It is an internal struggle. The constant self-doubt keeps screaming at you and makes you question if you have it in you to succeed.
If left unchecked, self-doubt can eat you away and make you a negative and depressed person. Such a person cannot be a successful entrepreneur.
The solution to this is to learn something new for at least one hour a day. Read books, listen to audiobooks and spend some time following the tweets of successful entrepreneurs.
The best way to eliminate self-doubt is to see others who have done it and get the belief that if they can do it, you can too.
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2. Managing complexity
Another big challenge for entrepreneurs is managing the complexity that comes with running a business.
Compliance and taxation will be high. Navigating your business through such complex structures will be anxiety-inducing and sometimes depressing. Work will come in small chunks and there will be many things to get done.
If you make a to-do list, it will be an infinite to-do list. Since the to-do lists are so long, you need to constantly prioritize tasks, outsource, delegate even and ignore some until they are urgent and important.
The solution to managing complexity is that you have to work your butt off. This would mean working on the weekends, early mornings, late nights and getting some work done while you are waiting for something.
I remember the time when my partner frowned at me because I spent 10 minutes replying to an important email when we were waiting for boarding the next flight. We ended up being the last to board the flight, but I got the work done and got it off my mind. No successful business is built without some sacrifices like this in the early stages.
3. Building an A-Team
Entrepreneurship is not a job. But for several years, in the beginning, it feels like a high-stress job with multiple bosses (your customers) and you will feel like a lone captain of a ship with no crew. Some people eventually grow out of this, but some people get stuck forever in this cycle because they cannot build an A-team.
An A-team is a team that takes care of your business and customers as much as you do. When you start building an A-team, things will slowly start getting easier and you can focus on the long-term vision and growth of the company, rather than solving urgent but trivial things in the day-to-day operations of the business.
Most entrepreneurs cannot build an A-team because the purpose of their business is to build freedom and wealth for themselves. You cannot attract an A-team with such priorities. If you want to build an A-team and attract top talent for your business, your business has to have a higher goal and vision of making a huge impact in the world. A purpose-driven business attracts an A-team.
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4. Managing close relationships
Many entrepreneurs find managing close relationships difficult, especially romantic ones. Unless your partner is extremely supportive and understanding of the mental state of an entrepreneur, you might get torn between things to do at your work and then things you need to do at home.
Entrepreneurs have their minds constantly buzzing with ideas, things to do, worry and excitement about the future. It’s like having a few applications running in the background on your computer all the time. If you are a someone who is married or having a living-in partner, entrepreneurship can be extra hard if your partner doesn’t understand how your mind works. Add kids to the equation and it gets worse.
Fortunately, I have someone who understands it and gives me the mental space I need. If she asks me something, I take 5-10 seconds to respond because there are a lot of things running in my mind already. If your partner doesn’t understand your mental stage and is not supportive, getting into a long-term relationship while you are trying to build something is going to hurt your relationship and your startup venture.
Either find someone extremely supportive or be single until you are confident that you have built something worthwhile on which you can lean on for the future. There is no such thing as a work-life balance for entrepreneurs because, for us, work is life.
5. Managing cashflow and finances
A business is like a pet when you start. Then it becomes like a demanding kid. Left unchecked, it can grow into a monster that is difficult to tame.
A business is an organism with many parts. All the parts together produce an output. A business also needs input. The input can take the form of capital, manpower, focus, creativity or teamwork. The output is revenue and profits.
A small business consumes less energy. A small business can still give more output than its input. If you want more output, the natural tendency is to increase the input. But many times, the balance goes off and things break.
Take a marathon runner who can take in 2,500 calories a day and run for 50 kilometers. You cannot expect to feed a five-year-old boy 2,500 calories and expect him to run that same distance. It takes years to get to a level of fitness to do that. It is not just a measure of input.
A lot of entrepreneurs end up feeding too much to the business at a very early stage and then the business gets sick. It takes a lot of gut decisions and instinct to manage capital, cash flow and manpower at the early stage of a business.
Unfortunately, in my experience, this is a skill that cannot be taught. It can only be learned through experience.
Most startups fail because the founder tries to scale the startup and things break. When the output is less than the input for a long enough time, you end up with a business that is dead. This is where entrepreneurs look for external capital, but capital at the wrong time is like feeding too much to a baby.
It takes a lot of courage to slow down something that is itching to grow. Capital is a double-edged sword. You want a fit business, not an obese business. Fasting the input and letting things stabilize is the hardest thing to do in a business, but it is the most important thing to do. There is no straightforward solution to managing cash flow apart from patience and experience.
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