I am feeling fearful for a lot of reasons these days. If I talk about the things that are bugging me, you might even laugh. This post is more about my fear of failure and ranting, as a startup owner. Facts may be jumbled up here and there, but you may still stand to benefit. A lot of emotions run through a business owner’s mind. There are some that the layman can relate to, while others, one needs to be in the same boat to empathize with us.
God blessed me with a trading business opportunity three years ago. As you can read from my past blog posts, I operate this business on a bootstrap budget and as a solopreneur. I thought in these ways, I could free myself from lots of unnecessary fears that used to bug me a few years ago.
I had some valuable experience running a loss-making business, and the memory still haunts me till this day. The last thing I want is for my own business to fall into debt because of over-expansion. The fear of failing is true and intense, mind you.
FAILING IN UNCHARTERED WATER
My current fear is a totally new animal. Thank God, we have good cash flow and we totally nail the solopreneur concept. The thing that bugs me now, my trade principal is “forcing” a new opportunity onto me. In case my competitor might read this, I’m going to keep quiet about the merchandise. But thinking about the new project is already causing palpitation to my heart.
Really, I thought I can stay “safe” by keeping my business small, amidst some minor advancement into different segments of the food market. After revamping some product mix and tweaking on the value of a few key products, we saw our profit appearing. In fact, after about a year into the trading business, we were able to run the company just on cash flow alone. We neither borrow nor asked for capital injection. I was comfortable and intended to stay this way, till I the day I can’t work.
Apparently, due to my reluctance to participate in the new project, my principal had negotiated with a damn competitor of ours. Imagine, my disappointment. To me, that was a form of betrayal. Needless to say, I confronted my principal upon knowing about the “conspiracy”. Although he promised there wasn’t any deal with the competitor in the first place, I was not convinced. I need to take up the project! That means more work and less play! What awaits in the next step beyond?
FEAR OF LOSS
I get this question A LOT from Quora. In fact, the rate of it is so common that one actually wonders whether an epidemic is brewing. The question is “Can I quit my job immediately?”
Of course, you can quit your job immediately! It’s so easy, depending on your state’s regulation. In the US, you just need to give 2 weeks notice. In Asia, we have it harder. Under normal circumstances, we have to submit a resignation letter, a month to 3 months in advance depending on our prior employment contract. On the other hand, the longer notice serves the advantage of giving us a buffer to cover our expenses while we search for the next step.
Reality bites after the “gung ho” moment. Honestly, if you have years of in-depth work experience, you should rise up faster going for the next job as compared to starting a new business. Opt for a side hustle instead before you actually throw in the towel, for God’s sake. Imagine starting from the ground up. Do you even have enough cash reserve to support your own expenses (your family if you are married) and to run your startup? How soon will these commitments burn a hole through your bank account?
Assuming your new startup is in working order. It managed to pay your bills but ain’t enough to fuel the staff and hardware. You still have to work solo. Imagine your ex-subordinates seeing you carrying cartons after cartons of organic flour into the warehouse. They used to listen to your orders, but now, they give you instruction. Can you take that?
Human is a creature that loves to judge others at face value. When I was a GM, the company provided me with a company car. I had a personal assistant and my staff rushed to receive me when I reached a branch’s airport. Now that I’m on my own, every dime counts when I’m running a bootstrap startup.
Most small business owners have a rough idea of the funds needed for the month’s payable. Buying a Lamborghini is the last thing on their list. Bear in mind, you might not even be earning more than your last drawn salary for the next few years.
BEING CALLED A FAKE
Ronald was depressed. Despite his effort to bringing back a company to the black, the board members did not show much appreciation for all the hard work. As a result, he quit the position as a COO from his company without another job in hand. He had given his best and yet, all his bosses did was to hold back his bonus and extinguishing the very last flame from him.
The whole resignation did not end well. In the corporate jargon, Ronald had burnt bridges. And you know what people said about those who burn bridges. After leaving the company, the HR department spread rumors that the reason that fueled Ronald’s resignation was incompetence.
Well, God was on his side though. A month leaving his employer, a vendor offered Ronald the distributorship license of the former’s brand of dough enhancers in the latter’s home town. At his age, going into business was the last thing in Ronald’s mind. He had given up the dream of starting his own business many years ago, after having involved in various challenges running businesses for others as a Senior Manager.
Now, this had something to do with his reputation. What if he failed? Here is the irony. One month into the new business, Ronald landed two GM jobs in his home city. If he followed his common sense, he would have opted for either one of the positions. As one of the Managing Director snide during the interview, “You are entering a highly competitive bread improver market. Let me assure you, you will fail in less than a year.” Ronald was faithful. He believes that God will lead him all the way if He has brought him through the new door. He has to prove to everyone that he did not leave the old company because of incompetence by making good his new business startup. Period!
FAILURE IN ENGAGING THE WRONG TEAMMATES
Teammates, partners, colleagues or whatever the term we called them, they could make or break our business. I have a lot of experience hiring people and honestly, it gives me the creeps whenever I need to hire.
Keat owns a trading business distributing commodities like flour, sugar, and others to manufacturers and wholesale distributors. Although the trading business operates on a razor-thin margin environment, Keat needs quite a number of workers. He can’t skim on storehands and drivers to cater to the daily operational needs. One of the delivery drivers managed to win over Keat’s trust, so much so, that he even trusted him to collect receivables on his behalf.
The incident happened when Keat decided to take a long overseas holiday with his family. When he came back after two weeks, the driver had absconded with loads of monies meant to pay off the creditors. I know the situation is bad because apparently, one of Keat’s major creditor has cut off his account. Litigation may follow soon.
I have also heard a lot of failed partnership cases. Albert was one of the partners (commanding about 15% of share equity) in a medium-sized auto accessories trading company. The biggest shareholders were his two uncles and a Sales VP, each commanding around 25 % of total equity.
Problems began when Albert’s uncle wanted one of his sons to work in the company as a Sales Representative. Let’s call the son as Leonard. The uncle pampered his son bad. Leonard will come to work after 11 am daily, much to the chagrin of Albert. One fine day, his uncle demanded that Leonard be given an above average salary raise in spite of his mediocre performance. Albert disallowed the increment and even had a bad fight with his uncle.
Unhappy with Albert’s opposition, the uncle moved a resolution to strip Albert’s from his directorship. They got embroiled in an ugly boardroom fight. Fortunately for Albert. The Sales VP decided to support him, and together, they moved on to form another company of their own. It was considered a fairy tale ending for Albert.
Most of the problems with a partnership arrangement manifest with money:
a. Disagreement with capital distribution
b. Discontentment with the allocation of rewards
c. Lack of funds
The fear of failure is not something without basis in the life of a business owner. As we are engulfed by the daily busyness, various types of variables are injected into our lives with our action and non-action. I have found some resources on overcoming fear here, here and here. But with all the resources prepared for you, are you ready to face your deepest fear?
As promised, the following is a link to my fellow blogger on Twitter: THE TWO SECRETS OF INVESTING: PATIENCE AND DISCIPLINE