4 Ways to Determine If Now Is the Right Time to Launch Your Business - Entrepreneur

4 Ways to Determine If Now Is the Right Time to Launch Your Business - Entrepreneur


4 Ways to Determine If Now Is the Right Time to Launch Your Business - Entrepreneur

Posted: 19 May 2020 12:26 PM PDT

6 min read

Opinions expressed by Entrepreneur contributors are their own.

Ideas for startups are often clouded in uncertainty during the best of times. In the midst of unprecedented global uncertainty, you might think it's best to shelve any such plans for the time being. 

In reality, it could actually be the best time ever to launch. With the growing for new ways to work and sell in light of health concerns and desire for new ways to access in-demand products, your startup idea could be just what's needed. Here's how to decide.

Ask whether your business idea is in demand

Over the course of the last two months, it has quickly become clear what type of gaps exist between what's needed during right now and what's actually available. Quick searches uncover where there are supply chain issues and a lack of domestic manufacturing for much-needed products and for services to expedite those products. 

Now's the time to create the type of change that could help solve such issues. This might not be the only time we face a crisis of this magnitude. The question is whether your business idea fills the right role or not. If it does, then move quickly and find ways to accelerate its launch. If it doesn't, then it may be better to wait until the environment is more conducive to your offer. 

Related: The First Question to Ask Yourself If You Want to Be an Entrepreneur but Don't Know Where to Start

If your idea is in demand, contact the organizations that need what you plan to provide. Reach out to government and private funding sources to get a financial boost and identify a strategy that will bring your offering to market more quickly. 

Determine whether you can pivot or change the idea slightly to meet the new demand

If your small business idea isn't quite ready for primetime just yet, consider whether it meets the new demand with some slight modifications or a pivot. If you are willing to redirect your business vision, it might be well worth putting in the necessary extra research rather than wait for the next good economic cycle to return. 

Related: 4 Ideas for Actually Pivoting Your Business Right Now

Business owners will need to explore ways to alter their current business plan and evaluate the costs, resources, skills and timing necessary to do so. Evaluate the and funding availability to make the pivot possible. You might even be able to return to your original idea later on. For now, though, consider the type of response you get from investors and your target audience in order to determine the viability of your pivoted idea. 

If that evaluation proves viability, then you can proceed. Otherwise, you'll need to put your plans on hold.  

Seek grants and funding to help launch the new business idea

One of the biggest deciding factors will be your ability to obtain funding. The challenge here is the lack of funding now available, thanks to the ongoing crisis. Investing in general is down, but a Crunchbase analysis of company funding statistics since the Great Recession shows there are certain sectors and business types that may be worthy of investment, even now. These include both early stage companies and later stage ventures. Slack, for example, held its seed round in 2009, while Coupa and Box did their C and B-1 rounds respectively that same year.

Related: Five Ways To Raise Money To Launch Your Own Startup

Some of the largest companies around were actually founded during deep recessions. From and to , ,  and , some of today's biggest successes launched before or during economic downturns like the Great Depression and the dot-com bust. These companies either operated on bootstrapped budgets or received funding from investors desperate to put the back on track. 

If you can make the case that your business model helps to solve a problem and can put people to work, then you might be able to attract investors looking to help reignite the success of small businesses worldwide. Also, explore programs like The New Business Preservation Act. Policymakers' focus on these programs, along with an historical perspective, should provide a positive framework for doing the same with today's startups. 

Search for talent to help get the business idea off the ground

Another critical factor is whether you can find the talent willing to join your startup and take a chance on it during such uncertain times. We're talking about graphic designers, coders, virtual assistants, bookkeepers, copywriters and the like. Depending on the financial position of available talent, they may or may not be able to work on an equity basis. Ask potential talent about whether they would consider working for a startup and under what conditions.

Related: 8 Reasons You're Losing the Best Talent to Your Competition

Alternatively, you might be able to recruit freelancers who are currently dividing their talent and time among many startups. For now, this approach can get you the required skills to launch. Later on, if the situation improves and your startup develops, you might be able to convince them to leave their other freelance roles and join you full-time. 

Start your talent search on online job board sites and through tech recruitment agencies to gauge interest and availability. Be prepared to provide a detailed description of the role and opportunity. 

Pressing the pause button is an acceptable choice

If you decide that this is not the for your startup idea, don't feel bad about pressing the pause button. These uncertain times will pass and you'll have another opportunity to launch. This moment to reflect may even give you more time to research, plan and develop your business idea to improve its odds for success down the road.  

First came a pandemic. Then, looting. Small businesses pick up the pieces as their debt mounts. - NBC News

Posted: 04 Jun 2020 12:41 PM PDT

Salih Mothana came home so quietly after he surveyed the damage to his small grocery store in Chicago that his family had no idea their business had been destroyed. Looters had raided the family store after a night of peaceful protests against police brutality ended with pockets of destruction last weekend.

"I understand why it happened, and it's OK," Mothana, a Yemeni immigrant, said in Arabic as his daughter translated. "It's not like I have to blame someone for this. I understand why this happened. If it sends out the message, it doesn't matter to us."

Mothana, who has run Express Food Market on the South Side of Chicago for over 20 years, is one of scores of small-business owners across the country who are now trying to pick up the pieces after social justice protests over the killing of George Floyd.

The damage inside Salih Mothana's Express Food Market in Chicago on June 1, 2020.Courtesy Salih Mothana

Some of the peaceful protests ended in violence, with groups of looters breaking into retail chains and small businesses, leaving local stores such as Mothana's with hundreds of thousands of dollars in damages.

Yet in a surprising twist that underscores how the killing of George Floyd has united people in the struggle for racial equality, many owners have expressed solidarity with the protesters, even while their stores have been robbed and their livelihoods left in shambles.

"Small businesses shouldn't have to pay for the anger that is being caused right now," said Anthony Galindo, who co-owns a phone repair business in Los Angeles called Broken We Can Fix It that was burglarized over the weekend. "We all support the cause and the protest. We're just collateral damage from the rioting."

Full coverage of George Floyd's death and protests around the country

Galindo's business had already been suffering under the coronavirus, he told NBC News. Sales dropped to zero as California rolled out stay-at-home orders to curb infections. The store had only been open on reduced hours for a few days before it was burglarized. The business is only covered for damage to customer phones, not damage to the business, he said. It's raising $35,000 to cover the cost of stolen inventory and damage.

"I want my kids to see their daddy go back to work," he said. "I hope everything ends peacefully and I pray this all ends as quickly as possible."

An empty display at Broken We Can Fix It, a phone repair shop in Los Angeles.Courtesy Anthony Galindo

From 50 to 60 percent of small businesses have insurance that would cover damages as a result of a burglary, according to Loretta Worters, a spokesperson for the Insurance Information Institute.

Businesses are not required to have insurance to cover property damage, but, "If you are renting your building, your landlord may require you to have some coverage to protect them from liability, or if you have a mortgage on that building then the mortgage lender would require you to have it," she said.

Business insurance is similar to auto or health insurance where a business owner can buy coverage plans specific to their needs or business, she said. An average claim for a restaurant would be different than that for a dry cleaner, for instance. Some businesses buy general property insurance, which generally includes damages caused by riots, loss of income in the event a business is too damaged to operate, or even what is called "civil authority," where a business owner is unable to reach their store because of damage in the area, said Worters.

It's unclear what losses small businesses have reported from the protests. For context, the 1992 Rodney King riots in Los Angeles resulted in $775 million in damage, or $1.42 billion today, according to the Insurance Information Institute. The Watts Riots in Los Angeles in 1965 resulted in $44 million in damages, or $357 million in current dollar value.

Tracy Singleton, who runs an organic restaurant in Minneapolis called Birchwood Café, has been handing over all donations to cover the damage to her business to local groups supporting the Black Lives Matter movement. The café was destroyed, with broken glass everywhere, Singleton said. She is covered for part of the cost of the damages through business insurance, she told NBC News.

"We're having this uprising of people who have been ignored and not listened to and not heard for too long," she said. "I did feel violated, but what do you do? You clean up the glass and open the door and try to keep serving the community."

"I did feel violated, but what do you do? You clean up the glass and open the door and try to keep serving the community."

Birchwood Café, which has been open for about 25 years, had already been pummeled by the coronavirus. Singleton laid off 54 people in March and brought back some part-time workers after the business received a Paycheck Protection Program loan through the government.

"There is no insurance for loss of sales because of justice uprisings because people are afraid to drive and come to our neighborhood," she said. "I'm not giving up. But I don't know what I'm waiting for. Maybe some magic unicorn with a big bag of money on its back."

However, not all business owners sympathize with the protests that left businesses damaged.

"I will not stand and cower in the face of evil and destruction, and no one should," said Ruth Domber, who had to close her optical retail boutique, 10/10 Optics, in Manhattan, after a night of looting earlier this week by "thugs going around and destroying local businesses."

Domber has since reopened after staff and supporters came to fix the damage to her store.

Mothana, though, said he has lost his entire source of family income. Any savings he had he uses toward new inventory. He estimates the store has about $400,000 in damages — and the insurance only covers about half.

"In my time here [in the United States], I have learned what my values are," he said. "I try to understand as much as I can and I'm very empathetic with the protesters and believe that should be the focus."

"No one expected this to happen," said Asalh Ghasim, Mothana's daughter. "We just have to move on because life just goes on."

5 Tips for Recognizing a Meaningful Business Opportunity When You See One - Entrepreneur

Posted: 11 May 2020 09:09 AM PDT

5 min read

Opinions expressed by Entrepreneur contributors are their own.

According to the Small Association, roughly 50 percent of businesses survive to reach their fifth year. What is interesting, however, is that the SBA's analysis found that these survival rates generally remain consistent regardless of the overall state of the . In other words, lasting is largely dependent on choosing the right business opportunity.

While understanding the basics of running a business is certainly important, your ability to recognize meaningful opportunities will play a major role in whether you author a lasting success story.

Idenitfying these opportunities isn't an exact science, but there are still telltale signs to look out for, beginning with the following five.

1. You've found a noteworthy market inefficiency

Not surprisingly, the best ideas come when you find a meaningful problem to solve. As I've written previously, some of the easiest ways to identify these opportunities come by looking at problems within your own community or drawing from things you've experienced firsthand.

A big part of why these methods are so valuable is because they help you identify issues that you are going to be more passionate about. As a result, your business endeavors are more likely to be warmly received and create a meaningful impact.

2. Identify successful in similar markets

I recently had the chance to speak with Alex Cruder, CEO of Curbie. During our conversation, he advised, "Pay close attention to business models and products that work well in similar markets to your own, but aren't currently available in your area. Look for ways to bring these concepts to your local market, as they will have much lower risk than more novel ideas. For example, I saw the success of online car dealerships in the United States, a that had not yet been introduced in . Bringing an already-successful to a new market led to incredible growth."

Even in our digital-centric age, many successful businesses are still confined to a particular country or region. This gives you the opportunity to establish your own similar business in your own area. The basic business model and product line have already been proven. Using this model to launch your own is an easy course to success.

Related: 5 Simple Ways to Identify Business Ideas That Could (Really) Change the World

3. A new approach to a tried-and-true idea

In a 2009 on-campus podcast interview, Raffi Amit, professor of at Wharton, gave this example of how digital entrepreneurs develop winning ideas: "You could go back to the beginning of , where they saw an opportunity to connect people through launching a virtual flea market. It offered a platform that connected buyers and sellers directly."

This description of eBay as a "virtual flea market" doesn't make it sound too unique, but that's a big part of what helped make it so successful. It took a concept that people already knew and understood and brought it to the digital world. This same idea has worked for countless other brands. Finding ways to digitize or otherwise streamline an in-demand concept will fuel rapid growth.

4. It's something people are asking for

Regardless of whether you currently run your own business or are working in a 9-to-5 job, your gives you ample opportunity to hear from customers. Direct customer feedback, buying trends and other requests give you greater insight into what the market wants and needs. 

Sometimes, your customers will ask for something that isn't currently being offered. Other times, they'll want something similar to what is already available, but better. Whether the opportunity lies in a new product or improved , paying close attention to what customers are saying is key for identifying business models that will be well-received by your local market.

5. There is an opportunity to act quickly

While market research and other preparatory steps are certainly important, many of the most meaningful business opportunities are those which allow for a fast launch and an agile, iterative approach. This allows you to respond quickly to market disruptions and pivot so you can better serve customers with your winning idea.

Being the first in your market with a particular idea also gives you the opportunity to establish yourself as the market leader. As one example, an evaluation of pharmaceutical launches by McKinsey found that on average, the first product to market maintained 40 percent of the market 10 years after its launch. Those that were fifth to market or later only achieved 10 percent of the total market share.

The advantage was even greater for drugs that had a longer lead time before other competitors entered the market. The ability to get into the market first has played a big role in the successes of brands ranging from Amazon to Kellogg.

Related: 7 Ways to Identify Real, Money-Making Business Opportunities

At the end of the day, you'll never know if a business opportunity delivers meaningful results until you test the market. However, by using these principles to help you better identify and evaluate ideas, you will be better poised for successful market entry.

Don't delay when you have a winning business idea in hand. The sooner you act, the greater your impact on the marketplace will be.

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