This is the first part of a series about how to start and develop your own business. Before we get into the process of things, let’s have a look at why people start their own businesses in the first place.
If you were having coffee with someone and they asked you why do people start a business? Off the cuff without thinking too much about it, you might tend to think that a person starts a business to make money. Sounds logical but probably nothing could be further than the truth, unless one has no choice about the matter because they got laid off from their job.
Yes ,a small number of people start businesses because of being laid off. But this is usually after they have looked around for another job and can’t get another one. After a period of not having a job, and losing hope of getting one, starting a new business begins to look more attractive. The apparent risks of starting a new business decline because you are not forgoing any salary, simply because you don’t have one. The type of businesses you might start in this case maybe something you know. It may be attuned to what you used to do like some sort of consultancy, secretarial services, fast food, cleaning or child minding services, or something like event management or professional placement. Probably less than one in ten new businesses fall into this scenario, however this is likely to increase in the future.
Some people have a successful career and see a particular opportunity that no one else sees. This might be an idea for a new product, a service that isn’t well provided for in the industry they are in, a business that can be built out of all the contacts you have, etc. You think about it until the idea bothers you so much, you become motivated to do it. This is most likely to happen during either the years of employment or during the later part of your career before retirement. Probably 2-3 out of 10 people may start out this way.
Some people just find working for someone else a big drag. They get on the wrong end of office politics, passed over for promotion, blocked for promotion because of family nepotism, or some other reason. These people don’t necessarily want to be entrepreneurs but some event crosses the tipping point and they go out and start their own business based on some ideas they have. What’s important here is their feeling of independence and this segment of entrepreneurs in Malaysia is going. Probably around 3 out of 10 businesses are started for this reason.
Some people come from families that own and operate their own businesses. Their parents are business people and the culture within the family of being self employed is very strong. These people may go straight from school or do a degree first and then come into the business. They may spend a few years working within the family and eventually take over the business or go out and start their own. This is fairly common where 2-3 out of 10 people starting a business may come from this type of background.
Then there are some people who have a cause that they feel is much bigger than themselves. These people (particularly women) feel they want to make a difference. They usually start some sort of enterprise that has some social aspect. Ethical enterprises are becoming a much more common form of business these days with the late Anita Roddick being one of the pioneer with her Body Shop brand back in the early 1980s. At the moment only 1 in 10 may start out for these reasons, but this is a growing area of interest among potential new entrepreneurs.
We’ve all read about the successful inventor who becomes a highly successful entrepreneur. However this is probably more urban legend than reality. Usually new inventors are surfers, runners, artists, or computer nerds who love what they are doing and find a new way of doing something that no one has thought of before. Bingo, their hobby becomes a business. This can go two ways. Firstly the business supports the hobby like those who sell 60s vinyl records, become aromatherapists or personal trainers and anything else you may have come across. Secondly, the new idea they have, ala an Apple computeror Nike Shoes becomes a big international business. One to two businesses out of 10 start out this way.
Finally, there is the rare breed of the habitual entrepreneur. These people sense potential opportunities instinctively and spend most of their mental efforts thinking about ideas and how to develop and capitalize on them. Their ideas may come from wide and varied sources like seeing a product or service while on holiday in Hat Yai, Bali, London, or Melbourne. They may see something old and traditional like kopitiam and outfit it into a completely new business model, or they may spot a vacant shoplot in a town centre and see a magnificent vision of an Italian pizza restaurant with table service there. These are the gung-ho pioneers of new ideas that live for the twirl of creating and growing a new business for the challenge of it, and of course if successful the money is good as well.
It doesn’t really matter why you start a business, what’s important as I said before is your courage and determination. In part 2 we will have a look at what your chances of success are.