“Half of Start-Ups Fail”

Have you heard that before? Well, actually, it’s closer to 9 in 10 start-ups fail. And there are a lot of reasons why. So, why bother trying? Well, again, there could be a lot of reasons to try–chasing your dreams, a really good idea, self-employment, to name a few. But starting a business is a little bit like having kids–there isn’t really a concrete, logical reason to do it. It comes from the heart. The key is to understand the risks so that you manage them well. Here are my top three tips for planning a start-up:

1 — Know yourself. Your idea, product or service might be awesome, but if you don’t also know how to manage the business side, your risks of failure rise considerably. You could take business classes to prepare yourself, find a partner with more business experience, hire a consultant or, yes, wait for it…incubate your business in a business incubator while you get a handle on the business skills. 🙂 Just don’t try to do everything yourself because the reality of starting a business when you don’t have business experience is that you begin with all of the things you don’t know–licenses, business plans, funding, etc. You don’t get to the good stuff of advancing your idea until later.

2 — Consider the possibility of failure. It seems crazy to start a business by planning for failure, but knowing the statistics, it’s important to make sure that you can financially handle a loss. It’s like having a will–if this ends, what’s the fall-out? Your average small start-up business does not attract investors. Most small startups get going on loans, their own assets or a combination of the two. So, take a close look at your long term personal finances — or have someone help you do that — and make sure you aren’t overextending yourself with your start-up.

3 — Research, plan, survey. Do not be impulsive. Talk to people. Ask small business people in your area how they got started, what were their obstacles, what advice they have. Bounce your idea off of people. If you’re concerned about the proprietary nature of your idea, keep the conversations in your close circle, but talk about it until people start to avoid you. You cannot have too much information, so gather data on others in your field, the area that you’re considering, cost comparisons, and so on. Before you decide to proceed with a start-up, you should know as much as you can about locations, competitors, costs, and market rhythms.

 

Settling In

Phew! It’s been a busy start-up summer and we’re already evolving. After many conversations with entrepreneurs and community members, we have a basic operating plan in place.

Retail & Service Incubation
The front of Live & Learn’s facility is devoted to incubating aspiring entrepreneurs and small business owners. You can rent the space flexibly for a pop-up store front, studio, office or gallery–by the hour, day, week or month. This space can be separated physically and visually as needed from the rear of the facility.

Incubator and Demonstration Kitchen
Beginning in September, Live & Learn will be offering a state-licensed, small kitchen for food preparation, classes and demonstrations. It will be a mobile set-up that can move to the front of the facility to complement the retail space when appropriate.

Entrepreneurship Programs for Kids — the Junior Entrepreneurs Club
Live & Learn is offering weekly Fun Nights on Saturdays or Fridays and an After School Enrichment program, both organized around entrepreneurship. The Junior Entrepreneurs Club will be starting and running two business this school year — a homemade dog food and treats business and a kid-run cafe.

Strategic Consulting
The established small business and non-profit consulting services of Live & Learn’s President, Gina Malloy, will continue throughout the year.

Opening in June!

The space at 34 Narragansett Avenue is coming together. We are planning an opening for June 24. We will be starting off with mystery scenes for folks to solve–freeze frame mysteries that invite your deductions. You can participate as an individual, group or family. We’ll also have Chew’s Clues for younger children.

Our first community project will be designing a JTNopoly game. We hope you will help us design the board and create the playing cards for Community Chest!

Live & Learn Kitchen will be offering up the talents of amateur and professional chefs from around Rhode Island. The menu will vary from week to week, but will always include delicious baked goods and tasty lunch or dinner items. If you love to cook and want to showcase your creations with Live & Learn, contact us to discuss the process.

We will also be offering the creative work of artisans, craftspeople and inventors around the region. If you would like to participate, let us know. Even if you’d just like to take your favorite hobby to the next level, Live & Learn is a good avenue for doing just that.

Our kids section will be set up for interactive play, so bring your little ones down, turn them loose and sit down for a cup of coffee and a muffin!

The Things You Hear While You’re Out to Eat

The other day, while I was treating myself to a solo lunch with a good book, I was seated next to a table of men clearly on a work lunch break. Now, I don’t usually try to eavesdrop, but these guys were right beside me and their conversation caught my attention. It went like this:

“I don’t have good control over two of my staff. It’s probably going to come back on me. How do you show you’re in charge?”

“I give them checklists and put them on notice when they don’t comply.”

“They don’t hate that?”

“Who cares? You have to tell them who’s in charge.”

So, if I were going to write a book on how not to relate to your employees, this conversation would be in it. I was busily eating my salad at the time and these men did not ask me to weigh in on their conversation, but if they had, here is what I would have said:

“In my experience, the people who have to say that they’re in charge usually aren’t. The best way to get people to listen to you is to inspire them to do so, rather than bullying them into it, which is at best a temporary solution and usually results in pandering rather than productivity.”

I’m guessing that both of these guys have a lot of turn-over in their staff because no one wants to work for someone who treats them like an errant child. I like this little acronym for effective management:

Listen to your employees ideas and frustrations. Encourage open communication.
Empower your employees to problem solve by creating spheres of independent action.
Acknowledge employee input and contributions. Promote a team mindset.
Develop unique relationships with your employees. People are individuals.

A little corny, perhaps, but definitely effective. A large part of being an effective manager is knowing your employees and tailoring your approach to who they are and what they need.

Introducing Live & Learn’s Weekly Blog Post

 

Live & Learn will be kicking off in Jamestown Memorial Day weekend if construction goes according to plan, so…well, we’ll keep you posted 🙂 Beginning right now, though, we can start the L&L weekly blog post, which will raise issues and scenarios related to starting, running and governing businesses and non-profits. Because it’s uppermost on our minds right now, let’s discuss licensing…

When you start a business or organization, you have to apply for a number of licenses with the state and local government. More than just a business license, there’s a shopping list of forms and fees required to start your business. You need identification numbers, taxation forms, usage permissions, organizing documents, and if you’re going to serve food or take care of people, well, the list just doubled.

These requirements have a purpose for the government to do its job and collect the taxes owed to make the world go ’round. But to you, it’s a giant, confusing headache that never goes away, but hopefully recedes into the background for a few blessed months at a time. The logistical hurdles just to make your business legal–never mind the fees associated with each form–are some of the main reasons to try incubating your business or organization idea before committing to the reporting, tax and monetary requirements of going out on your own.

If you aren’t confident of your success or are worried about your financial position or just don’t want to deal with the hassle until you have more community feedback, then finding a place to try out your idea makes sense. If you’re thinking of starting a business in South County, give us a call, and we’ll see if we can help you test out your business dream in a low-cost, safe environment…once our construction is complete, that is. So, we’ll see you at the end of May or thereabouts.