I’ll let you know up front that I’m not going to show you how to do something or even tell you what to do in this post.
Neither of those are my goals – my goal is to keep you on track in building the company that is right for you. I’m quite sure that that’s a goal we both share.
Here are some facts:
- After about $75,000, most people’s general happiness does not increase when they make more money.
- Most mom entrepreneurs are still pulling what socioligists call the second shift – they work full time in their business only to pull a second shift taking care of their kids and husbands.
- Home-based businesses have been on a steady rise for the past few decades
- There are capacity and growth limits to a solo or home-based business.
- Businesses often consume more resources after their growth stages, not during them, precisely because what it takes to stabilize the business for the long-term requires more resource investment sometimes than what they make during growth peaks. This flatlines a lot of small businesses.
That’s an interesting grab-bag of facts. On the one hand, it’s never been easier to start your own business. On the other hand, many people start their own business only to figure out that the reasons they started their business aren’t quite sufficient to actually grow the business past some of the dips and crucibles.
You’re Growing Two Things At Once
For instance, starting your own home-based business because you want to stay home with your kids might be good enough in the beginning.
However, it can take 18 – 24 months for you to figure out what business you’re actually in and maybe another two or so years to really start rocking that business. Meantime, you’re going through the hardest parts of motherhood and business-building, all the while (hopefully) making some space for yourself.
In other words, by the time it’s (financially) worth you being in business, your kids will be school-aged. If that was the leading reason you had to be in business, you’ve got an interesting motivational challenge and strategic choice on your hands: do you stick with the business (at all), do you keep it at its current scope, or do you make it bigger?
No single choice is better than any other. That may seem simple enough, but it’s actually quite heretical in the business world because there’s pressure to grow for growth’s sake. After all, if your revenue or demand isn’t growing every year, your business isn’t getting any better, right?
What that type of thinking misses is that maybe your business is better for you, even if it makes less than it did last year. It also blurs the distinction between profit and revenue, but that’s all too common anyway. Hint: grow your profit line, not your revenue line.
It may be better for you to keep your business at its current scope because it allows you to live the life you want to live. It may be better for you to roll it up if you can find a good job that pays you comparably without all the stress. (Heresy!) Or maybe it really is time to put your foot on the gas pedal and move beyond bootstrapping into a company that better fits your capabilities and vision.
Working Harder and Longer Isn’t An Effective Growth Plan
Most of my clients are women and many of them are moms.
A consistent area of focus of our work is on prioritizing time, energy, and attention, and I’m always up front that it’s likely they’re going to be more engaged and time-strapped as their business grows unless we make some fundamental changes to the way they do business.
“Working harder and longer” is not an effective growth plan, and while that sounds obvious when said that way, many mom entrepreneurs have exactly that as their default plan without knowing it.
At the same time, we jointly work to build a company that works for them and their customers, regardless of whatever other social pressures may be at play.
Sometimes that means we build their business based on them having 4 hours a day. Other times that means we need to account for extended vacations.
My job is twofold in these scenarios: 1) helping them find the leverage and opportunity in the constraints, and 2) helping remind them that it’s not useful to compare their business to others with a lot of hands and manhours available.
I’ll pause on that second one: payroll consumes a lot of revenue and it doesn’t matter whether you have employees or independent contractors.
Because so few people focus on profit rather than revenue, many inexperienced owner-executives hire people without understanding that they’ve just dropped their profit line unless they make substantially more from having their teammates. Their business makes more, but it also costs more to run.
Do the math: a solo business that earns 75k with 10k overheads makes the same as a business with an employee that makes 100k with 25k payroll and 10k overheads. (It’s a much sexier marketing message to focus on 6-figure businesses without going into the details, which is precisely why so many marketers stick with that.)
There are a lot of other factors that come up with having a bigger business, which is why I tend to remind people that comparing their business to other businesses isn’t useful – there’s a lot kept behind the scenes and there can be a lot of smoke and mirrors on the stage itself. As Henry Ford once said, “The competitor to be feared is one who never bothers about you at all, but goes on making his own business better all the time.”
Better Is What You’re Looking For
“Better” is the perfect word here. Not bigger. Not smaller. Not more famous. Not “to the next level.” Better. For you and for your customers.
As you’re contemplating where you’re taking your business in 2012, I hope you’ll focus on what it takes to make it better – for you, your family, your team, and your customers. One size doesn’t fit all here.
Here are some questions to springboard from and make this more specific:
- What are some key experiences you’d like to have with your kids, friends, and family next year? Are they every day activities, weekly activities, monthly, etc? What shift do you need to make to make room for them?
- What do you need to do to make sure that you’re getting the best of you? What accountability structures do you need to put in place to make sure that you follow-through and actually do those things? (Why, yes, I do know what your patterns are.)
- What changes do you need to make in your company to make sure it’s a better fit for you? Note: making more money is an outcome, not a plan, and, as you may get from this piece, it normally doesn’t help answer question 1 and 2 above.
- What activities – business, personal, or whatever – aren’t nourishing you or those around you? Don’t be the social superwoman for others at the cost of being a superwoman on your own terms.
- What do you need to do to find the peace, love, and contentment where you are now rather than at some point in the future? Trust me, if you don’t start finding it now, you won’t be able to find it then.
Remember, better = right for you. No more, no less.
Your turn: of the five questions above, which seems like the best to start with for you? Which seems like it’s going to be the hardest?