What are the timely issues keeping entrepreneurs and small business owners awake at night?
I am seeking input on what issues are top of mind with entrepreneurs and small business owners right now. I've listed some of the issues that people have brought to my attention in the past few weeks. Please share your thoughts:
http://www.smallbiztrends.com/2007/07/what-keeps-you-awake-at-night-entrepreneurs.html
Answers (25)
Jay M
Venture Technologist, Entrepreneur, SEO-SEM Strategist, President at Coco Design Associates
Best Answers in: Starting Up (1), Web Development (1)
The things that keep me up at night are growth related... not always knowing what it takes to take the company to the next level. I have asked a question in LinkedIn related to the same (see link below). I must admit, I did get some very good answers (both public and private), the common thread being the creation of a 3-person advisory board. We do not have any investors, nor are we looking for any. However as we take the necessary steps in our march to break the first million dollar barrier, we keep increasing our expenses more rapidly than we increase our revenues. I know this is to be expected when bootstrapping a company, however that doesn't let me sleep any better.
On the other hand, I sleep comfortably knowing that I stand on the shoulders of giants. I work with some of the best people in their fields of expertise. Because of them I can see beyond the horizon (aka the bleeding edge of technology).
It requires fine balance when approaching the tipping point, so sometimes I need to stay awake.
Links:
Eugene S
Project Manager at Cyberlog Technologies
Best Answers in: Corporate Governance (1), Inventory Management (1)
Cashflow, cashflow & cashflow. Unless you have venture capital, then it's growth, growth & growth.
I think its the constant changing vision as the most prominent issue.
Second is the struggle between urgent but not important Vs important but not urgent - So many smaller issues take so much of quality time, that the only time at times you get to think on real important issues is at night.
What Say?
Anita - Depending on the industry, different things will keep entrepreneurs up at night. The most common responses will probably be: healthcare, regulations, tort reform, access to capital/cash flow, taxes (death tax), hiring/retaining good employees, battling against larger competitors (especially retailers).
What would be interesting is to see who has dealt with a knockout punch, but managed to survive...and even grow their business. For example, dealing with embezzlement, fraud, your largest client going out of business and taking $100k in receivables with them, your business partner running off to Mexico with your money, computer meltdowns with no backup. Entrepreneurs are NOTORIOUS for flirting with disaster. I imagine that what keeps most of us up at night is trying to figure out how to grow our business while trying to avoid the next disaster.
Brian Moran
Links:
Dale F
Increase profits without adding resources
Best Answers in: Personal Investing (1), Wealth Management (1), Starting Up (1)
Anita,
Many small business owners get into business to do what they enjoy most. Generally, they offer what's already available in the market; then they wonder why they struggle to get customers interested in their offerings. They lack a clear differentiator and they believe that everyone can use their product or service. In other words, they're not giving the buying public a reason to do business with them.
These are the reasons why small business owners don't have an effective tag line or an well-constructed and engaging 30-second elevator speech.
It's why, as Eugene said, they experience cash flow problems. They invest heavily in an ill-conceived business strategy.
Raymond L
Founder, Managing Director of Flow Ventures
Best Answers in: Starting Up (4), Project Management (2), Labor Relations (1), Business Plans (1), Using LinkedIn (1)
Anyone in IT is worried about the ability to hire qualified staff in an increasingly tight job market. There simply aren't enough tech grads or H1-B visas to keep up with demand and outsourcing is not really viable for small businesses.
This has a direct effect on the cost of hiring the right people which has a direct effect on the real thing that keeps entrepreneurs up at night: cash.
Raymond
Terri L M
Planning and Strategies Consultant; speaker, trainer, author.
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Hey, Anita Campbell, how go things with you here in Ohio?
I'd have to say that the things that keep a lot of small business owners up at night are basic things like how to keep all the balls in the air at the same time and keeping the quality level of your product or service at the high levels you want. Items mentioned by others all fall into this category to some degree: maintaining cash flow, keeping on schedule, knowing if and when to grow the business, finding affordable healthcare, marketing to keep customers coming to your door.
As the economy heats up again, attracting qualified staff is a big issue. We're all glad to see things heating up, but no one wants to see the late 90's tulip craze again, when it became so difficult to hire great people without giving away the store (or all the equity)
Also Funding, and figuring out what share of the business its worth giving up to get the right money and the right investors. Everyone I know is worrying about the "correct" formula, and of course there are no across the board answers.
And finally, balance. Can you be a successful entrepreneur and still have something of a balanced life, be a good parent, good friend, whatever form balance takes for each person. This may be less true for a traditional small local business (though I can't say that for sure) but the entrepreneurs I know what are trying to take a start up to the big time think about this last one a lot.
Janet
Dawn R
Journalist and Publisher, Wahmpreneur Publishing, Inc.
Best Answers in: Freelancing and Contracting (1), Employment and Labor Law (1)
At the risk of being redundant (since I haven't read any of your other responses yet), here's what keeps small business owners awake at night: health care.
There's also issues around cash flow. Earnings trends seem to be down and so are economic expectations. That's not a good combination.
Oh, and did I mention health care?
Anita,
As a bootstrapper, I'd say it's both time and money that keep me up at night. While not seeking any huge investment, at least not before evolving certain products to a more predictable business model, the challenge is to constantly seek ways to shift time and cash flow to meet emerging opportunities. Especially how best to throttle back on those opportunities where cash flow is clearly declining but that still represent too much earning to drop completely. As a part-time entrepreneur another stress is the balance of worklife with other business interests, knowing that some opportunities will be lost due to time constraints, and all the while trying to work out the logistics of the inevitable transition to entrepreneurial enterprise on a full-time basis.
The daily challenges of maintaining and growing a business are very demanding of an entrepreneur's attention, so it is quite a struggle to stay on top of emerging trends and technologies.
I'd echo many of the above answers, but the ROOT cause of sleepless nights, in my mind, is how to surround myself with the right people. I have this conversation repeatedly with fellow entrepreneurs--How do you find people with focus, drive, and discipline? Those characteristics seem to be in short supply in a society increasingly driven by the need for instant gratification. Without such people, your company's creativity, integrity, customer service, etc., all suffer.
Apolinaras "Apollo" S
Business operations and technology leader for ambitious startups
Best Answers in: Intellectual Property (1), Quality Management and Standards (1)
Finding good employees is what keeps our partners awake at night.
We have a very rigorous process of selecting potential employees. From skill to behavioral testing, we realize that in a sea of talent, there are very very few people who fit our strict requirements. Do we find good people? Yes, but with our growth, we can't hire best of the best. It is like mining for diamonds, you have to sift through a lot of sand. Importing talent in the current political climate is just not a good idea. Off-shoring is out of the question too.
One of the top questions I hear - and have experienced myself - is how to raise money when you've gone past the beginning stage of your business, you're not in the development stage...but without funding, you may have to close! A growing business needs capital, and yet, banks are reluctant to lend money to a small business - because the owners may have had to tap into alternative funding during their start-up. Now that they're on their feet and have opportunities to expand and grow, but need money to hire new employees and/or buy more equipment, banks are shying away. As if investing in a new, exciting company is just not done.
This is not new - banks love to give money to folks who don't need it. But, not only do they deny folks who need it, investment funds, they look at the debt ratio (which might be higher than the company owner likes, but had to be that way to keep the doors open) and the banks raise the interest rates on existing loans!!
Where is a small business to go? Angel investors are few and far between, and VCs want that new, amazing tech gadget. They won't even talk to a service provider.
I've kept myself on track by continuing to find outstanding clients, and by always keeping an eye on the ratio of income to outgo. I believe in the "never give up" attitude... and the 'bricoleur' concept - that is, doing what you can, where you are, with what you have. So far, it's worked for me. We are definitely on track for some exciting results, this year.
The thing that keeps me awake at night is trying to figure out how to balance growth with maintaining positive cash flow.
Kare A
ceo at Say it Better Center, LLC
Best Answers in: Customer Relationship Management (1), Business Plans (1)
How can I create more differentiating value to become their natural first choice?
How can I increase my profits with a premium version of my product/service?
How can I increase my retention rate of current clients?
How can I increase per-client spending?
How can I motivate my clients to refer more and more qualified prospects?
How can I enter lucrative, new niche markets?
How can I reduce my overhead without reducing the quality of my product/service?
Finding good talent! This is especially difficult in NE Ohio, but of course a challenge in any business.
The youth of the Web and surrounding industries makes it especially tough because those learning technology in school are just scratching the surface. We are just now starting to see candidates with practical experience.
Our biggest challenge are HR related. Finding, retaining and motivating good people. We have made some hiring decisions in the past that haven't been great and we need to get better at this process to ensure we only hire the very best performers.
Matt G
Owner at 9 Mile
Best Answers in: Risk Management (1), Offshoring and Outsourcing (1), Corporate Governance (1), Project Management (1)
Paying the bills and wondering if I did the right thing leaving a comfortable job.
The other things that keeps me awake is the bar across the street with live music that is open until 5am each morning, and the trash collectors emptying the bank of recycled bottles at 4am. There´s nothing quite like the last one for waking up clutching your chest as the crash of glass resembles a lorry driving through your window. And I live on the 4th floor!!
Anita - I beleive the biggest challenge is to recruit and retain a well knit core team. Everything else is a business phase, that can be managed well if you have the team's support.
Hey Anita,
In and amongst all the typical growth, cashflow and economy issues, is one issue that I am hearing more this year than ever before . . . .
Business owners are worried about the tech-savviness of their employees; rather than their own personal skills.
It's coming up more this year than I have ever heard before.
As a 9-month old web development firm, we currently struggle with two major issues:
1. How do we manage the chicken and egg nature of growing a consulting business? In order to take on more work, we need to hire more. But to hire more, we need reliability in our revenue. Lots of discussion around risk.
2. How do we balance short term vs long term opportunities? We have plans to develop some of our own web applications, but continue to find really good client work. Clearly a "problem" we like to have, but nonetheless, something that keeps us awake.
Links:
As a small business advisor/coach, this is what I hear:
1. Cash flow
2. Sales (not enough and how to grow)
3. HR issues (personnel and management)
4. It's lonely being a business owner (no one to be a sounding board).
Hope these answers help in your research.
Carole
Links:
Cash flow, cash flow, cash flow... No cash flow, no dreams fulfilled. I believe one of the single most important learned skills is the ability to manage the funds on hand. Second, building the right team to fulfill your dream, and how. It takes money, and its more expensive than one would think when you factor in taxes, fringe benefits and such. Those are what have been my experiences... Good luck.
The gap between what they know they are doing to improve their company and what they think they should be doing in terms of investing their money, people and time to "Get There"
