Photo courtesy of the New York Public Library
Here are six things I've learned since deciding to start a business six years ago. A lot has changed since then. One glaring change is that I don't even offer the service I originally offered. And as of late, I mostly feel like I'm a writer, but maybe that's the season my business and I are in or the fact that I've spent the last six months writing a book.
1. Working for yourself is a practical skill that everyone should learn
In the long run, working for one's self or running a business might not be for everyone, but I think working for yourself is something everyone should at least try. Even if it's a part-time side-hustle that only lasts for six months. You'll learn so much, and when you have the experience of generating income on your own, you realize that it's possible to have more control in that area of your life. It widens your lens of possibility and shows you how making money for yourself is an exercise in power.
2. A growing business continually feels like it's breaking
Sometimes the things you do that get you to "Point A" are very different from the things you need to do to get you to "Point B." In business, this means you have to break systems to create new ones. Or you have to stop offering one service in favor of another. The constant growth of a small business is organized chaos. It's a beautiful mess that always feels a little bit out of control, but it's an endlessly engaging endeavor.
3. Make a plan to make a profit
A couple of years into running my business, I learned how to reserve engineer profit. Even though my college degree is in business administration (lame, I know), I didn't learn this in school. I learned it by applying the principles I read in the book Profit First. The other thing I did was commit to really understanding how money flowed into and out of my business. I dedicated just one hour a week to care about my business finances, and it made a marked improvement in my understanding of what was impacted by the bottom line and my actual bottom line. I was able to increase income by 136% in one year, which has allowed me to keep investing in my company.
If you like running a business and you want to keep doing it indefinitely, profit matters. Suppose you want to sell your business one day, profit matters. Even startups that lose money for years eventually need to make a profit. You are doing a disservice to yourself and your employees if you are a business owner that ignores the fact that profit matters.
4. Making money can be easy. Let it be easy.
I'm not saying making money is easy like you can simply visualize or collage your way to dollars in the bank. It does require heaping amounts of focus and taking massive action. But doing that work might be a lot easier than you think it is. When you can leverage your natural strengths, serve a community you care about, and solve a problem really well, you might discover that earning money feels easy because your values and actions are aligned with what the market wants. Sometimes we make it hard because we don't want to pivot or compromise. We have ideas about what we want our business to sell versus what your market wants you to sell. Sometimes we make it hard because we believe it must be challenging, and anything less than a struggle isn't deserved. Let it be easy. See what happens.
5. Build things once and sell them twice
Even if you sell a service, you're ultimately selling a process or a framework. Build a process once and sell it as many times as possible. This idea was one reason why I wanted to write a book. It's an exercise in building something once and selling it twice - hopefully a lot more than twice.
6. Business owners need to seriously consider shifting to an employee-owned business structure or at least sharing profits
Owners control and benefit handsomely from the production of employees and technology. The ruthless competition of capitalism has given us wonderful things that a non-capitalist world might not have - like the fantastic computer I'm typing on and the comfortable sweater I'm wearing. They are the results of competition, exploitation, and the carnage of capitalism. Capitalism will not disappear overnight, but it's evident that so many of our social problems are at their root, economic problems perpetuated by this system. One could argue that the rise in populism is directly related to the widening inequality gap. And the attention economy is a result of the incentives built into a capitalist society. There are so many examples I could give.
Business owners have an opportunity to contribute to a solution. We could all consider restructuring our businesses to allow employees to benefit in the same way shareholders and owners do. An alternative to an employee-owned company where employees still reap their work rewards is to create a profit-sharing program for all employees.
What has allowed humanity to reach this point of prosperity today, let's call it point A, is likely not what will get us to an equitable and prosperous point B. The people who help us build our businesses deserve to be rewarded for their work. I hope other business owners will join me in this call for a radical restructuring. I am personally committed to restructuring my business in the next three to five years. If you're curious about this journey, stay tuned because I'll probably write about it.