Tuesday, February 12, 2013

Small Business Freedom

Unless you came from a family of small business owners, the mindset of owning a small business probably wasn't taught to you. They don't teach it in business classes and it's certainly not taught in our schools. Schools are more interested in making sure we show up to the factory on time and stand in a straight line. Look alive citizen. So when I started my own business, there were three important psychological breakthroughs that thankfully developed on their own, but it took years. These were thought processes that helped me succeed that nobody taught me, and perhaps they can't be taught.

You have permission. You can leave your job. You can start your business. When I first started, I had this anxiety that I wasn't supposed to be doing this, that someone was going to come and get me and bring me back to reality, to work or maybe school. There's a bit of insanity inherent in starting a business, because you just don't know. Whenever a prospective business owner asks me how he should project his sales, I laugh like a maniac for a moment. You just don't know. Project them to cover your costs. What else can you do? Asking that question is the first koan of small business.

Even if you think it's perfectly fine to start a business, there's nobody to tell you when to begin or to say when you've had enough. Worse, there's no safety net or unemployment if you fail. There's no relevant trade organization or support group. You're on the trapeze. There is no net. Nobody is even watching. I worried the IRS would audit me for being implausible.

It took about two years to realize I had permission to be there, I could truly own the business and only then did I have the confidence to move forward. Before that time, I was tentative, asked a lot of  people what they thought I should do, and constantly kept my options open. I was always afraid to burn a bridge, and always wanted to keep one foot in my old life. Accepting I had permission opened me up to be creative in what I was doing right now.

The money is mine. If you've never had your own business, the money you've been spending at work is someone else's. It may be a faceless corporation, some shadowy investors, or a mean boss, loved only by his dog. Spending money at work is like playing a game, passing Go, exchanging wood for sheep. It's not your money, so it's never a big deal. The rent went up? Well, what's a Sim to do?

Realizing it was my money got me to resent when money was spent, when someone had their hand in my pocket. It took three years to get to this stage. It required profits really, the realization that if I paid an extra dollar in rent, that was a dollar I couldn't use to pay my mortgage. Bills and debt weren't passive things to be endured, they were active enemies to be conquered, potentially eliminated. Sales were important, but you have less control over income than you have over expenses. Beating down expenses became fun, even when they caused endless headaches. You know my goals in December to reduce the alarm and Internet expenses? Nothing but trouble. But there were savings and eventually the pain will be forgotten.

There is no limit to your success. You own a small hobby store. You probably won't make much money. You certainly can't afford a mortgage or an education for your children. You should probably expect a modest salary. It's a monastic lifestyle without the spiritual benefit for yourself and others. These are all things you're told or tell yourself or worse, your family tells you, so you can accept that you won't be making what you used to, or you won't aspire to the middle class ideal (mortgage, retirement savings, college savings and annual vacations). Perhaps they hope you'll come to your senses and get off that trapeze. It's a lie.

It took about six year to realize I wasn't being held back by society, my trade or the invisible hand of economics. There was nothing holding me back but myself. There was no limit in how much my business could earn, if I could figure it out. I wasn't getting rich, but I was punching through my self limitations. The worst group to listen to turned out to be my peers, the majority of whom, like peers in every trade, had limitations for themselves firmly in place.

At this stage, my personal effort wasn't as important as figuring out how to leverage the energy of others. In other words, if I could plan it properly, other people could continue it after execution. A lot of business owners quit early because they can't give up control, can't delegate, can't accept their job is coming up with the sausage making process and not physically making sausage. The thought of future sausage making exhausts them and they quit. Sure, there are some theoretical limits in all this, but these are limits you realize after you hit them, rather than barriers you place in front of yourself.

Finally, these are hard won realizations, but realizations that many small business owners come to. It explains why many are fiercely independent, do their own thing, spit in the eye of anyone who tells them it can't be done. Doubt and apathy are indulgences they can't afford.

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