What two things do you need to do to make your new business really fly?
Stefan Kazakis’ foray into business wasn’t exactly what he had planned. His parent’s textile manufacturing business was battling to survive and they desperately needed some help.
“It was back in the late 1980s that they really started to struggle and were caught in this vortex,” Kazakis says. “I looked at it as a broken business and rebuilt it from there to the point where I was able to sell it in 2002 to enable my parents to retire with options.
“I took the business from near bankruptcy to a multimillion-dollar turnover and there was satisfaction turning that business around both from a personal and commercial perspective.”
Kazakis has since gone on to work with many small businesses helping them resurrect declining turnover and a falling customer base through practical formulas, techniques, systems and tools.
“The two most common questions I get asked are; ‘will my business survive?’ and ‘what do I need to be successful?’
“I can tell you that your business won’t survive the first year unless you have two things – heart and a logical mind. If you have those two traits, the money will come.”
Kazakis has just launched his book From Deadwood to Diamonds which uses the metaphor of a diamond as his chapter headings and throughout to help individual business owners “ask the brutal truth about themselves and their businesses”.
The book is very practical with regular exercises throughout for small business owners to understand themselves and their businesses and to ensure that they are on the right track, and if they aren’t, they soon will be if they follow his advice.
“The book was three years in the making and I have called on 25 years of life and business experience to write it,” he says. “As a successful business coach I am constantly working with businesses all over the world of different shapes and sizes. I look at the sales, marketing, finance and people aspect of the business and see how they can all work together.
“Small business owners need to be clear about their destination and have done their research about the market that they are in. They need to also try to understand where that industry is headed in the next five years.
“People often change the journey halfway in through panic and fear. They fear the unknown, they even fear success but they need to believe in themselves, ask the right questions, hire the right people and be brave.”
Alec Lynch was brave. Two weeks after being promoted at Strategy& (formerly Booz & Company), he walked out to start his own business – DesignCrowd.
“I had always been interested in design and I started the business in September 2007 from my mum’s coffee table with three credit cards and $10,000 cash,” Lynch says.
“I formally launched in early 2008 but six months in I had maxed out my credit cards and had run out of cash. I had to borrow $30,000 from friends and family to keep it going.”
Lynch is very happy that he stuck to his plans and belief in the website, despite overtures from his management consultancy company to come back.
“We expect to hit $15 million in revenue this year and we want to double the size of the business in the next year,” he says matter-of-factly. “Globally, the world of design is a $46 billion-dollar business.”
DesignCrowd relies on a very simple concept – it matches people and or businesses that wants designs with a designer. It also offers a money-back guarantee if you are not happy with the work.
“I had always been interested in design since I was about 14 years old and studied business and IT programming at UTS,” Lynch says. “At various stages of the business I have raised money – $300,000 from angel investors in 2009 and $3 million from venture capitalists in 2011 – but never did I lose faith in what I am doing.
“The advice I would pass onto people in the first year is make sure you have access to additional capital and funds not only to survive but also to grow quickly. Secondly, never give up. Be prepared to try different things in your first year as it is better to find out early what works and what doesn’t. It is the best way to learn.”
Workplace law is one area small businesses have to wary of and it is the one area where Joydeep Hor thought he could make a difference. After practising in the field for 13 years, he started his own company People + Culture Strategies on July 1, 2010, and in less than four years the revenue is now three times the value of the business in its first year.
“I saw a gap in the market and I wanted to change the way of doing business in the area of law,” Hor says. “Most law firms build a business around something going wrong. Our view is that if we work with you from the beginning to shape the decision making then things shouldn’t necessary go wrong.
“We like to work on a retainer with clients starting at the front end of the business in order to stop the back end problems.”
The workplace relations law firm now has more than 20 employees and continues to grow with Hor twice being named in Australia’s Hot 40 Lawyers in the Australasian Legal Business magazine.
But he did have some initial problems in his first year.
“I was a recognised brand but my firm wasn’t,” he says. “I needed to get clients to understand that I was part of a firm and not an individual brand. We also had to ensure that all our infrastructure from IT through to office furniture was state-of-the-art so there wouldn’t be any problems on that front.
“I think one of the keys to surviving the first year is not to draw attention to the fact that you are a start-up because that plants the seeds of doubt into the client’s mind. Far better to emphasis your experience. Also, small businesses need to be patient. You won’t be successful overnight so ensure that you build the right culture and hire the right people.”
Surviving the first year takes courage and a few risks, but a lot of self-belief, determination and a few dollars in the bank should help you get through to year two.
*Original Article: http://www.theage.com.au/small-business/startup/surviving-your-first-year-20140912-3fg5f.html