Editor’s note: This article originally appeared in Alan’s weekly Forbes column.
I’m asked every day by aspiring business founders, “Should I take the leap of faith and pursue my dreams?”
If you evaluate your experiences and skills versus essential attributes of entrepreneurs and can see you are lacking in a few areas, it doesn’t mean you can’t engage in free enterprise. It simply means you should look for business opportunities that play to your strengths. To this end, consider what you love to do and the knowledge and talents you possess.
I am pleased to share four options that might align well with who you are and what you enjoy. If you are ready to become your own boss, which of the following alternatives suits you best?
1. Agent/representative — If you feel your strengths are in sales and a willingness to take care of your customers, consider becoming an agent for an existing brand. You can build your own business without having to wear all the hats. The cost of entry is relatively low and your income can grow quickly and usually without limit, especially if you have the persistence and resilience to keep at it.
Insurance agents, real estate agents and even direct selling representatives find freedom in being able to focus on sales and customer service while the parent company provides product development, marketing and much of the back office support. A network of agents provide companionship, mentoring and encouragement.
On the downside, the turnover in this type of relationship is very high. Minimize your risk up front by researching the companies, brands and management you will be representing. Know the business plan, what your costs are and how you are compensated. Don’t mistake the focus on sales for the need to work hard in all aspects of your business.
2. Consulting/contract — If you are a born self-starter with a creative streak and marketable skills, consulting is a great entry to owning your own business and the model allows for relative ease in scaling up when the time is right. Consulting can be especially useful if you are looking for a way to keep your skills sharp and valuable. Networking will help you keep a steady stream of clients to avoid the feast or famine syndrome.
Be sure to participate in industry associations and local business groups such as your chamber of commerce to enjoy regular professional interaction and continue developing your skills. Peer relationships can be a great way to combat the loneliness of having your own business and also provide additional power for generating creative ideas.
3. Franchise — If you excel in leadership and team building, perhaps a franchise opportunity is the best path to business ownership. Similar to an agent/representative model, you have a ready-made brand and operating system, support staff, and advertising and buying efficiencies. However, as a franchise owner your initial focus is managing the business and hiring and leading others to contribute to the success.
In addition to your own management skills, selecting the right franchise opportunity can be equally important. Consider working with a franchise consultant to determine which franchise will meet your needs, passions and business goals. According to FranNet, a company that offers personal franchise assessment to match individuals with franchise opportunities, of nearly 1,300 franchisee placements the company made between 2006 and 2010, 92 percent were in business after two years, compared to 64 percent of other small businesses.
4. Small business — Do you have your own idea and the natural ability and drive to follow that dream to reality? If so, don’t hesitate and take the plunge when you are ready. For sure, you’ll have the most freedom and potential for growth, independence and satisfaction, but you’ll also wear all the hats while working in unpredictable circumstances.
It’s true that in your own business there are no ready-made brands or support staff, but there is much outside support. Work with the Small Business Development Centers in your local area and the many other ventures designed to support entrepreneurs. For example, my own company, Grow America, is designed to create jobs by supporting entrepreneurs with a little extra cash and a lot of mentoring. Incubators, investors and industry associations can provide help in areas you lack expertise and also connect you to resources designed to help you grow.
Don’t worry if you haven’t come up with your big idea yet. But do get started on your dream of becoming your own boss today. Play to your strengths as you gain experience in all the areas of owning a business. I wish you success as you follow your heart. As always you can reach me via my personal website at www.AlanEHall.com or on Twitter via @AskAlanEHall. You can reach Grow America on Twitter at @GrowAmerica as well.
Alan E. Hall is a co-founding managing director of Mercato Partners, a regionally focused growth capital investment firm. He founded Grow Utah Ventures, is the founder of MarketStar Corp. and is chairman of the Utah Technology Council.