This article marks the second full year of my being a business owner. Before that, I worked in the corporate world for my entire adult life.
I always considered myself a business savvy person. I read the Wall Street Journal and dreamed of working on Wall Street from the time I was in 5th grade (strange, I know!). I ended up, luckily, not on Wall St., but instead working in the world of High Tech. My roles had businessy titles like Financial Analyst, Business Development Analyst, Product Manager, Principal Product Planner, Director of Business Planning and the like. I worked on acquisitions, product planning, innovation and strategy projects. I used to think that I knew how businesses worked and how to build products customers would enjoy.
I figured that when it came time to do my own thing, I’d have a pretty easy time of it. After all, with no one else to slow me down, I should be able to run wild with my ideas and make them happen! Right? I always imaged that running my business would easier than working for a big company. It could be simple, and I would get to call all the shots. I couldn’t have been more wrong!
Running a business, even as a solo-preneur or freelancer, is hard. It doesn’t matter if you were a rainmaker at a large company there is nothing that compares with the challenges of doing your own thing.
In spite of all these problems, millions of people in the USA alone venture to run their businesses. What is it that draws people to something that is so difficult? The benefits – the lure of freedom and autonomy – as well as the chance to create something that is only in your mind’s eye, is very tempting.
Two years ago I took my leap from corporate worker to entrepreneur. Actually, before that, I took the leap to being a world traveler….then leaped to start my business. I expected small challenges along the way, but nothing major. What actually happened was completely different than my expectations.
Now, looking back, I’m glad I didn’t know how much effort it would take to get where I am today (which is still not sunshine and unicorns). Yet, I’m glad I did it. I wouldn’t trade the experience for anything. I’ve become a stronger and more capable human being along the way. I’m also far more empathetic to the struggles of people who are trying create something from scratch.
Here are the essential lessons I’ve learned in the past two years.
1) If you build it, they might not come
I started my journey to build a coaching business in November 2015. The only person I told was my wife and our two dogs. This was when I enrolled in an Executive Coach training program and mentally made the shift from thinking that I would go back to a corporate job to one of wanting to create a career on my terms.
But, I didn’t put myself out there and try to find clients. I also hadn’t set up my business structure yet. That stuff happened later in December/January of 2015/16. The name of my company was Ravi Raman Enterprises, LLC. My “trade name” was “Raman Coaching.” Very creative!
In my mind, I thought that within six months, I would have completed my coaching training and also have enrolled enough clients to cover my modest living expenses. Having downsized my lifestyle in 2014-2015 (selling my car, renting out my fancy home), this would amount to about $5,000 of profit per month. I thought this would be an easy number to hit within a few months, and by the end of 2015, I expected to be earning around $10,000 of profit per month.
I was so far off!
The fact that I was earning a hearty salary and stock package in the corporate world had zero bearing on my earning potential in my business. Even more, I thought that I would have a full docket of clients to work with, within months of my “opening up shop,” which for me meant creating a website and sharing it with my professional and social networks. After all, I had a big professional network. Who wouldn’t want to work with me? Turns out nobody did…at first.
What I learned was that fields of dreams only exist in the movies. If you build it, they may not come. It’s more crucial to continue to refine and test what you offer to make sure that you have the right product-market-fit. Marketing is also essential.
I figured out the bigger issues that were holding my business back. It turned out to be two primary things: a limited mindset – more on that below, and a lack of marketing. It turns out that people didn’t understand what “coaching” meant. I had to be more clear in how I told my story. I was able to fix the issues over time, luckily (I’ll go into the details below). You might be wondering how long it took to build my business up to a sustainable level. It was much long longer than you think.
2) Expect it to take 3-5X as long as you think
Bill Gates is famous for saying that we tend to overestimate what we can achieve in the short-term, but underestimate what we can achieve over the long term. So true!
It took me 18 months to get my business to the point where I was convinced that it could be a viable enterprise with enough income coming in the door to cover necessary expenses for my family. I thought it would take about three-six months. A big disclaimer with this number, I am offering a service (e.g. my brainpower as a coach) and not a physical or digital product. What this means is that if I had to build a product (and refine it), my expectations would have been different (and longer).
Also, I was doing this as my full-time job. I was coming off a self-imposed gap year of world travel and threw my heart and soul into my business. If you were spending less time and energy, it might take even longer.
The lesson here is that starting a business and getting a reasonable income from it is doable, but assume it will take much longer than you thought. Save up enough money to allow for a long “takeoff runway” or stay in your job (or find another job) to pay the bills while you work on your business on the side.
3) Don’t automate too much at the start
My temptation, as a technologist, was to use software to automate as many aspects of my business from the outset as possible. Online marketing funnel software to gain traffic and qualify leads. CRM systems to nurture leads through the process of enrolling them as clients. Scheduling software to avoid the back-and-forth of finding agreeable times to meet. Digital signature software to sign work agreements online. Payments software that could support lump sum or subscription payments. Sales funnels using webinars, Facebook ads and landing pages. I even dreamt up proprietary software I could build (using contractors) to support my coaching programs.
The ideal end state was to have a series of systems in place to handle all aspects of my business so I could focus on the one thing I enjoyed the most, actually working with and coaching my clients. As I started my business, I devoted a ridiculous amount of time researching and experimenting with these systems. It turns out, it was all a waste of time at the start. I had done all this before I knew if my business would work.
I eventually got fed up with trying to find and setup all the right automation systems and decided to do everything manually. Spreadsheets replaced any need for a CRM system. I sent simple electronic invoices instead of dealing with fancier payment systems. My singular goal was first to find customers, and then automate things once I knew I had a business that worked. I embraced an inefficient way of doing things, so I could see what areas would work with the support of software.
A benefit of this is that I learn how my business was working because I had to be involved with so many different elements of it. Now, I use more software to automate things like signing agreements, handling payments, scheduling and more.
Don’t try to make your business a smooth-oiled-machine at the start!
4) Mindset is everything
Six months into my coaching business I had a crisis moment, as I wrote about in a previous blog post. After enrolling a handful of clients into coaching programs, everything ground to a halt, in spite of my putting in a ton of effort around marketing. I chalked it up to it being the start of summer here in the USA.
“Perhaps people are thinking about how to enjoy their upcoming vacations, and not thinking about improving themselves or their careers?” I thought. After a few months of struggle, with nobody expressing interest in coaching, I decided that if I couldn’t figure out how to drum up business, I was going to give up and go back to the corporate world as a Product Manager.
That’s when I met my Coach at a startup conference near my home. What impressed me about him was that he understood technology and business, having worked in Silicon Valley in the 1980s, and had been a coach for senior leaders for over 25 years. He was a coach before the coaching industry existed! Even more interesting, when we met, he was going location independent, leaving his home to work and coach full-time from various parts of the USA.
Working with my Coach for the better part of the year helped me address the fundamental issues that were going on with my coaching. I was a great coach. Yet, I wasn’t confident in the sales or marketing of my service. I had some serious mental blocks and limiting beliefs. This struck me as a shock, as I considered myself an excellent marketer and very confident in my capabilities. But, I soon realized that I was great at marketing other people’s products and services, but marketing my stuff was a different story!
As a result of all this work, after 2-3 months of working together, I was able to grow my client base steadily, and after six months I had attained my goal. Without the support of a coach, I would have given up.
5) Don’t let your dreams crush your goals
I recently wrote another blog post titled “Don’t Let Your Dreams Crush Your Goals.” I didn’t write it just because the headline was intriguing. I wrote it because I’ve seen this to be true in my own life and the lives of clients I work with.
I had (and continue to have) big ambitions for my business. Not just about income, but the impact it can create on other people’s life. The irony I’ve discovered is that dreaming too much can get in the way of achieving anything.
Imagine that there are two people with the same capabilities and desires, but one spends their time focused on tactics (e.g. how do I find my first, second, third customer) and the other spends time building long-term plans and visions. Who would make faster progress? The tactician will beat the visionary every time. This doesn’t mean dreaming is bad. It does mean that a common trap for business owners (or those thinking about making any big change in their life) is that they dwell too much on the dream (“I want six-pack abs”) and not enough time acting on the tactics (“what time am I going to the gym today?”).
It’s through the tactics and daily actions that you will learn about what you are passionate about (or not), what strategies work (or not) and where you need help. It’s also through the tactics that you will get results. Results create motivation. Dreams are motivating, in the same way, taking a warm bath feels good. It works, but only temporarily. Tactics are like taking a cold shower. It might be painful, but the compound benefits are tremendous.
I spent way too much time dreaming and planning the long-term impact my business could create before I had any revenue coming in the door! I would have been better off spending that getting my first few clients and learning how to better serve them.
6) Let the market teach you
No plan survives a battle with reality. This doesn’t mean that you shouldn’t plan at all. It also means that you should listen to the signals your market is sending you.
When I started my business, I had the desire to coach those who were looking for higher performance in their work. Improved productivity. Greater confidence. Faster promotions. I also thought I would focus on working with those who are in smaller and startup oriented organizations. I had an entire business plan prepared with notes on my ideal clients, their pain points, and how I could best serve them as a coach.
My first client fit the most I was targeting. He was a mid-level manager at a startup looking to break through to the C-level ranks. My next customer, however, was a physician! Yes, that’s right, a medical doctor. This individual was referred to me, and in spite of my emphasizing that I was focused on working with folks in the tech sector, she wanted to work with me, and I agreed. Then, my next handful of clients were all in larger companies, and their primary needs were finding better jobs outside of their companies (not higher performance in their current job).
Most business coaches will tell you to pick a niche and stick to it. I learned that as long as an individual was highly motivated and coachable (e.g. willing to accept feedback and act on new ideas), they could benefit from my coaching. I decided to say “yes” to all clients that fit this mold. I figured that I’d be better off letting the market tell me what my niche was, instead of my assuming I knew what it was from the start!
After two years, I’ve learned that my clients tend to fall into two buckets. 50% of them are actively looking for new jobs and 50% are looking for higher performance for themselves (or their companies). 80% are in tech-oriented jobs (engineers, product managers, sales execs) whereas the rest is a mixed-bag of business owners and professionals (and yes, I’m still working with the Doctor!).
It’s best to let your niche and specialties emerge. At the start, it’s fine to define a target, but be flexible and listen to signals the market is telling you about who your actual customers are and what they need.
7) Leverage your talent stack (we all have one!)
Scott Adams, of Dilbert fame, has written about talent stacks. Adams claims to not be the funniest comic or the best at drawing or the best business thinker, but when you combine all three skills – humor, drawing, business, he is outstanding compared to others.
What talents do you have? What would it be like to combine all those skills into a single vocation where you could be world-class? For me, I discovered that clients come to me for a few reasons:
First, they value my experience working in the tech industry. Whereas most coaches come from counseling or HR backgrounds, I came from a history of building and shipping tech products. This creates a sense of trust that I understand client situations and challenges.
Second, people admire my background in yoga and meditation as a signal that I could help them combat the stress of an intense work environment. As a former yoga teacher and lifelong yogi, this training comes through in how I coach.
Third, I practice what I teach. I coach people to have the audacity to build outstanding lives and careers. I have had the opportunity to radically redesign my life over the past few years to achieve greater satisfaction and happiness. People resonate with the congruency of my having done what I challenge others to do (though, not everyone should or needs to quit their jobs to travel the world as I did!). Instead, I coach people to figure out what they want out of their lives (and careers) and make small but consistent steps towards that desired goal.
The past two years of running my business haven’t gone as planned, but I’ve learned a ton along the way and am happy with where things stand right now. I have no idea what the next few years hold. Perhaps, things will continue to progress well, with growing revenues and client success stories. Maybe I’ll hit a few roadblocks along the way and need to reassess my approach. Either way, I’m looking forward to each day as I venture to create a career and life that I can be proud of.