As the 21st century job market continues to constrict, working people are retooling their vision of how they will make a living in the years to come. This is driving young people and mid-career types alike to pursue small business ownership as the new career of choice. Creating your own job is the new path to job security.
When people seek business opportunities, it is important that they pursue options based on the right criteria. Too often, people that are new to business ownership may think they know what they want before they are aware of what is available. As children, we may have wanted to pursue a career as a cowboy or an astronaut. Both of these jobs sound pretty cool, but the interest is based on both a limited knowledge of career options and little consideration of other life goals such as where you will live, if you will have a family of your own and what type of skills or training will be required. When searching for a business we need to carefully define the things that are important to us such as lifestyle and financial goals while being realistic about our unique competencies.
Another big driver that defines our options is our investment capability. This is typically defined through consideration of our net worth and our liquidity. A good rule of thumb is that you need about 30% of the total that you will invest in liquid funds and then you can finance the other 70%, provided you have remaining assets to collateralize the loan. I generally recommend that people not put more than half of their net worth at risk. This is a prudent guideline and while sometimes it leaves people with options that don’t fit their original vision, it is better to start small than to be over extended when starting a business. Your first business doesn’t have to be forever and you can graduate into a business that requires more capital later, when you have the resources and experience to do it properly.
Finding the right entry point can launch you on a very rewarding career as a business owner and allow you to perform at your best level. The good news is that today there are more business models available to choose from than ever before, so choose wisely and don’t be afraid to ask for help from a qualified advisor.
Have a question about business opportunities? Send it to firstname.lastname@example.org. Dan Brunell is President of Dearborn West, LLC, a national business opportunity brokerage headquartered in Temecula, CA. He can be reached at (951) 587-6929 or on the web at www.dearbornwest.com