The Six Secrets to Going from Employee to Business Owner in 12 Months
Most people imagine that starting a business has to be something they wait decades to do, amassing years of knowledge and experience and needing a huge capital investment. But you can go from being an employee to being a business owner in less than twelve months if you apply these simple secrets.
Secret #1: Raise your standards.
People often set low standards for themselves when they are working for someone else because they are “saving it” for when they have their own business. In reality the way in which you go to work today is the same way in which you will show up to work when you are the boss. Your body and mind develop set habits (whether you like it or not) and these will be impossible to break later on – regardless of whose name is on the front door. So set the right habits now, while you still can.
The secret: Be as focused and work as hard as you would as if it was your own business. Your mind and body will then be prepared for the day when the business really is yours.
Secret #2: Familiarize yourself with the financial end of your current business – whatever your role.
Depending on the kind of company you work for, which department you are in and what level of transparency the owners are willing to have with you, you will be able to do varying levels of this. If you work for a public company or a very small business, where the owner is transparent, you might have complete access to financials. In many other cases though, you may not have full access. However, you will always have access to a certain level of knowledge about the finances of the company. And showing an interest may get you extra brownie points with your boss.
The secret: While you are an employee, you want to make sure you start to understand how and where the money flows into, and out of, the company. Begin to understand the difference between revenue and cash flow. Learn the difference between a profit and loss statement and a balance sheet, so you understand the difference between items that hit your books on a month-to-month basis and a report of the overall financials at a certain point in time. Understanding this concept in the business you currently work for will allow you realize what it really means to be a business owner. Owning a business is not just about being the boss; it’s about understanding how to create an entity that consistently generates revenues and profits with costs kept at the lowest possible level.
Secret #3: Cut your personal expenses significantly.
One of the most common reasons so many small businesses fail is that the business owners are not able to sustain the company without removing significant amounts of money from it on a monthly basis. To prepare to allow your company truly to thrive, it’s very important to make significant expense cuts in your personal life. A little pain now allows for enormous gain later on. Cutting expenses now allows you to (1) save enough money to live on for the longest period of time possible during the infancy of your company, and (2) learn to live on a tighter budget in order to have less demand on your savings and on your business in the early stages of operation.
The secret: Starting a business often means a substantial pay cut for the first year. Get your finances in order and prepare yourself to take the leap.
Secret #4: Make as many expense cuts as possible in every aspect of the current business you work for.
As a new business owner, one of the most important tasks you will have is to keep costs low. You can do this by eliminating unnecessary and wasteful spending, including negotiating with vendors to get the lowest possible prices. Setting up favorable payment terms and ensuring that every dollar spent somehow brings revenues or efficiencies will result in profits for your company.
The secret: Learn to cut expenses in your current business. This will be one of your top priorities as a future business owner.
Secret #5: Get yourself involved in as many areas of the company as you are able to.
These next 12 months are the time for you to work harder than you have ever worked before and to broaden your knowledge of business in every possible way. Diversify your knowledge by sticking your head in every available department, especially the departments you know little about. This includes getting involved with things such as sales, human resources, accounting, operations, marketing, and just about anything else you can think of. By expanding your knowledge base you will teach yourself invaluable lessons that would otherwise take you years, or even decades, to learn as a business owner. Keep in mind that since you’re going to spend time in other parts of the company, you’ll need to work significantly more hours than you have in the past. If you want to own your own business, this is something that you had better get used to now.
The secret: Learn the necessary skills you need to run a business – on someone else’s dime.
Secret #6: Turn your car into a mobile business university.
It’s time to earn your MBA as you drive. That’s right — starting today, your car is going to be a mobile university where you are going to give yourself an MBA. Whether you already have a degree in business or don’t know the first thing about owning one, it doesn’t matter. Starting today, you’re going to spend the next 12 months educating yourself in every aspect of owning a business – while you drive.
Make yourself a commitment that you will not do anything while you drive, other than listening to audiobooks and audio programs specifically created for small business owners. Educate yourself on every aspect of business you don’t fully understand. Listen to books on hiring, finances, running a business, creating processes and procedures and leading others through management. The key is that in the next 12 months you need to educate yourself on all the aspects of running a business that you will use in the coming years and decades.
The secret: Use your passive time over the next 12 months to give yourself more knowledge about business than most people learn in decades.
Starting your own business can be the most rewarding and the most challenging time of your life. Prepare for it over the next 12 months by working harder than you have ever worked. Treat the current business you are in as if it is your own business and prepare yourself for what you are about to do. Owning a business is not an easy thing to do. For those who prepare for the battle ahead, it can be one of the most incredible experiences of your entire life.