Knowing when to start a business at any scale is a very tough decision. Entrepreneurs usually rely on market trends and studies to determine what kind of businesses are worth undertaking at any given time. However, with a recession, timing may be a bit trickier, rendering the traditional business forecasts useless.
Consider the risk. There is no sure way to guarantee the success of a business, whatever your sense of timing may be. Some successful people get to the top by trusting their instincts. Starting a business involves calculated risks. Are you ready to absorb the potential downturn, if your business doesn’t succeed? And is the market ready for the business idea you had in mind?
Consult with stakeholders. Decisions like these are best discussed with the concerned stakeholders, which might include your family, investors or business partners. This would allow you to get more inputs and suggestions. Who knows, you might get that eureka moment from a suggestion your teen-aged child gives you. Or your investor might have an unusual idea crazy enough to give you the edge in your industry.
Consider your finances. Where will you source money for your business? Will you borrow from a bank? Will you seek investment from a venture capitalist? Will you partner with friends or relatives? Will you use your retirement money or life savings to start your business? Each of these has their advantages and disadvantages, and each will give you different degrees of exposure, both in terms of financial and personal aspects.
Consider the feasibility. If you are seeking financing from a bank or from venture capitalists, the first thing they will want to know is whether your business idea is feasible. If it will let you earn and pay off their investment in the long run, then they will most likely help fund your business. But if they think you won’t even make it to break even point in five years, they might not give you even a cent.
Start and then put your worries aside. Some business ideas are nipped in the bud even before starting. If you’re taken care of all the possible risks, then get started, if you think the market is ready for your service or product. If there was no risk involved in the whole business deal, there would be no business at all. Once your enterprise is running, learn to adapt and adjust, according to the situation.
Make sound decisions. Being a business owner, you have to make decisions, from small ones to big ones. When you make mistakes, though, take responsibility and learn from your mistakes. These could be the best tools for success any entrepreneur could have.
Have an exit strategy. Whether your business succeeds or fails, you should know how to make a graceful exit. This is especially true for businesses financed by angel investors or venture capitalists. Will you turn over shares of the business for a certain amount? Or will you sell shares of stock to the public in an IPO?