Issue link: https://nbm.uberflip.com/i/1425980
graphics-pro.com 91 S T A R T H E R E 2 0 2 1 Capital This is money, tools, and anything needed to help run the business — usually referred to as resources. This is accounting software or capital expenditures like property/plant/equipment. The garage where many Silicon Valley unicorns begin falls under this category. Securing funding from investors for operations and securing revenue through sales all come under this category. IPOs, lines of credit from the bank, operating expenses, CapEx — all qualify as capital. Labor All businesses run on people. You need humans to scale. This may be a piece of the puzzle much later in your time with the business, but no less important. By bringing on others, you can continue to focus on what you are exceptionally good at and hand it off to others. The business owner needs to continually remove themselves from the business, or at least the parts of the business they are not good at. Labor is the key to turning your income into equity. Someone else needs to work in the business. You need to eventually work on the business. You cannot do both. What Is Wealth? Wealth = time. Robert Kiyosaki, author of "Rich Dad, Poor Dad," famously defined wealth as the number of days you can survive on your income. For example, if you make $100,000 per year, but your monthly expenses are $10,000, you may be consid- ered rich, but you are not wealthy. You will run out of money in 10 months, leaving you searching for extra income two months out of the year. A business owner making $50,000 per year with monthly expenses of $3,000 is a wealthier person. They can relax a little bit. They can enjoy the fruits of their labor. After all, what good is earning it if you can't spend it? You got into this to be your own boss, right? Most Ventures Begin With One According to Forbes, over 70% of small businesses in the United States are owned and operated by a single person. Over 50% of them are home-based. Over 500,000 new businesses get started each month. On paper, small business owners are doing this all by themselves. The truth is that 1 in 3 small businesses never make it to the two-year mark, and only half make it to five years. A weekend warrior grinding out a side hustle is great for extra spending money — you want to build something. Leverage The Gig Economy Got a quarter, a dime, or any other U.S. coin in your pocket? Notice the words E Pluribus Unum? It's Latin for "one from many." Even though you are the sole employee and 100% equity owner, you can wield an army of specialists to help you run the business. Fiverr, Freelancer, and Upwork are just three of the most famous. There are also individual freelance networks for specialties like legal, HR, and supply chain. Need a handyman? Porch.com. Need a media buyer for an ad campaign? Bark.com. Hiring an employee is a great long-term solution, but it's not the only solution. In today's economy, you have options. Cash Flow Will Always Kill Your Dream It's not resources or a failing product. Tons of great ideas are gone because the business could not keep its doors open. Inno- vation does not sustain a business; cash flow does. Almost 1/3 of small businesses in the United States use credit cards to finance operations. Having an equity partner can help spread out your risk and make sure you have enough working capital for emergencies, like lack of demand. Be Your Own Boss The No. 1 reason given for starting a business is to "be your own boss." The top dog. The one that calls the shots. Most wake up one day to realize that they no longer have a supervisor, but they still work for someone — the customer. The grass isn't greener; it's just different grass. Don't go it alone. Your success and wealth depend on being smart about your time and your resources. Leveraging partnerships can eliminate the early risk and build momentum. If one day, like Rockefeller, you decide to buy out your partners and go it alone, at least you will have a solid foundation to stand on, and you can really be your own boss. That is living the dream. Tune in to Ep. 28 of The GRAPHICS PRO Files at http://gpro.link/danacurtis. Dana Curtis shares advice on mistakes to avoid and reasons to take the plunge and start your own business. Even if you are the sole employee and 100% equity owner, you can wield an army of specialists to help you run the business.