How do I choose

There are lots of ideas for new businesses in my New Business Ideas Collection, with more coming out each month. Some people have said that they feel a little bit overwhelmed by all the different ideas, so if that’s your first feeling, don’t let that put you off. Here are some ideas about how to choose the best business for you.

It’s up to you

This is your life, and you get to make the choices. Don’t be swayed by your friends or family, especially if they don’t have experience of growing a business. Friends and family tend to advise others to take the safe route and do something boring.

Of course, they do, they want you to be safe. And, possibly, your friends and family want you to be boring  – because they like you just the way you are and don’t want you to change.

Make up your own mind about what you want to do with your life. And then ask your friends and family for specific ways that you’d like them to help, like babysitting for two evenings a week so you can get going on the new idea, or lending you 5k for a new website. If you ask for advice or permission you might not like their advice, and you might not get their permission. Make your own way.

Think about where you are in your life

We all have different aims, hopes and desires at various stages in our lives. And these are pretty much always related to our good old friend – the money.

You might have a deeply held desire to do something to make the world a better place, rather than make oodles and oodles of cash.

Or you might want to build a company that you can sell for 5m in 5 years. You might want a business which is going to give you some extra money pretty quickly because you’ve lost your job and you need to pay the rent next month. Or you have a job, but hate it and want to do something for yourself, and run your own business.

You might already have a business, and you want to add in a new idea to make more money from your business, or to change that business into something else because it’s not doing so well, or because you’re a bit bored of it.

Think about what you’re trying to create here and what it means to you. There are no right or wrong answers – I work with business owners who want to get their business up to earning 30k a year and people who are aiming for an exit worth 10m. And everyone in between.

A realistic view of your finances

The first thing to do is to get a good grip on your finances. Work out how much spare cash you’ve got, and if you can get any more from someone else to invest and get something going. The amount of money you have right now will influence which of the business ideas you can take forward.

And work out how much money you’ll need in the next six months.

Don’t just guess at this, get your bank statements out (ideally in a spreadsheet downloaded from your bank account) and go through what you’ve spent in the last six months. Work out what was essential in this spending, what was a genuine one-off, and what you can save. Don’t try to shave off too much and drive yourself into a poverty mentality, but we all have those things we spend money on which we don’t need, like fancy coffee, meals out, nice clothes we bought because we needed cheering up. If you spend a lot at the supermarket, get your receipts out and look at what you spent it on. Can you switch from the expensive olives to the cheap brand and do you need that Manchego cheese all the time.

With these more accurate figures, you’ll have an idea of which of the recipes you can afford to get going with. And you’ll have an idea of when you’ll need the business to make money for you.

Matching your budget with the business ideas

You might have major ambitions, but not a bean to your name. Or you might have some savings you’ve built up over time so that you can get into a business which needs a bigger investment.

Maybe you’ve got a job at the moment (or an existing business), and you can go part-time so that your basic expenses are covered while you get going with the company. Or you’ve got a nice wedge of cash from an inheritance or from selling a previous business.

How to read the ideas

I’ve done a section in all of the recipes which explains how much money you would need to get that business going. And I’ve said roughly how long it would take for each business idea to start generating income. Pay careful attention to these parts.

No money, need money fast ideas

There are some ideas in the New Business Ideas Collection where you can get going straightaway for a minimal investment and get your first customer through your existing networks. These are great if you don’t have a lot of money to invest, and if you’ve got to cover your next month’s rent asap.

But be aware that although this sounds great, these businesses are mostly service-based freelancer type businesses. These are more difficult to build up to sell on to give you a lump sum, or to give you a high income. But they can be a great way to get started.

Even if you start a business now which is on more of a freelancer or billable hours model, you can start this alongside your existing job to give you some security while you get going.

I haven’t included any businesses which I don’t think can generate enough money to live a decent life on, but we all have different ideas of what a decent life costs, so you have to think about what you want to earn.

Start small, and invest in something bigger

One option if you don’t have any money at the moment is to go for one of these recipes, and save some of the profits from it while planning one of the bigger businesses. Then you can sell it on, or get someone else to run it for you, you’ll have learnt loads about how to run a business, and you’re in a great position to start working on something bigger.

I can survive for the next six months

If you’ve got part-time earnings or a little bit of savings to keep you going, you can afford to go for one of the business ideas which need a website building as part of the set up (often your main cost in getting a business going.) Or one of the ideas which involve developing new skills or a customer base over time. There are lots of business ideas for these, as I especially like businesses where you can put in the effort at the beginning and build up over time. These tend to have more significant money earning opportunities later on than the ones that will pay your rent tomorrow.

I’ve got 25k in the bank

Good. You’re well placed to take advantage of a lot of the recipes here. As long as that 25k will pay your bills for the next while (remember how you’re going to add up exactly what all those bills come to) and leave some over for your set up costs, you’ll be able to take your pick from most of the recipes.

I’ve sold my business/house/racehorse and I’ve got 1m+ to invest

Great – although the same advice applies, because you may have built up an expensive lifestyle and it’s amazing how quickly a million can disappear nowadays.

Now we can start looking at what kind of business is going to suit you

Different strokes for different folks

People get excited by very different things. Some folk love the idea of an online business you can run from anywhere in the world with an internet connection and want to be a digital nomad and travel the world. Other people would hate that and want a business where they’re working with a team who are all in the same office.
There are business ideas here for all kinds of people. And all kinds of skill sets.

There are ideas for people who like to work alone, just them, some good music on and their computer
There are ideas for very gregarious people who love to be out and about talking to other people and networking.
Some are for people who are pretty advanced at online marketing or have the time to put into learning all of this to make sure they have a steady stream of customers
And some ideas are for people who love their creative side and want to be involved with developing a new product
There are ideas for people who want to run a social enterprise or a business which directly changes the world.

What resonates for you – and why?

There will be some of the ideas where you think, “yeah, I could do that”. And others will make you think “oh, god, no way, that sounds boring”.

As we all tend to ignore anything we find boring, it can be quite interesting to look at the ideas that you turned away from, and work out why they weren’t for you. Was it the thought of selling direct to people or the concept of hard physical labour? Or the ones where you’d have to learn a lot of new skills? Or the ideas that involved coming up with a product or collection of products?

Once you’ve worked out what you don’t want, you can start to work backwards from that to the ones that you do want to do. Or you might find something that you were not into the first time, but once you’ve looked at it again, you begin to get your head around it a bit more.

Nothing yet?

Don’t worry if none of the ideas grabs you straight away. For one thing, in your subscription to the New Business Ideas Collection, there will be a whole bunch of new ideas next month, and one of those might be exactly what you’re looking for.

Choosing your next business venture is a big step, it’s not the same as just choosing a recipe for your next dinner party. That can be stressful enough. Take some time to think through the ideas and try them on for size. Get some colleagues to do a mini 360 degree feedback session for you and tell you what they think you’re actually good at. Maybe you’re better at customer service or learning new software than you think you are.

Decision time

If you’d like some help in coming to a decision or getting a grip on some of the issues we’ve talked about here, you can book a 2-hour session with me. We can do that face to face if you’re near Brighton or on Skype if you’re further afield, and we can talk about what the next stage is for you.

I can help you to go through the maze and come to the right decision for you.

Here’s how to book a 2 hour one-off session with me and get everything straight before you get started.

Photo credit – Gatec21 Flickr – creative commons