Book sample - Starting a Business

The Entrepreneur Definition

This book is for you if: 

1. You are working in a company now and are contemplating leaving it and starting a business . . . you are looking for greener pastures . . . you found your true passion . . . you are sick of working for someone else.
2. You left a company recently and are thinking about starting your own company versus looking for another “real” job.
3. You are a student and contemplating becoming an entrepreneur after you graduate.
4. You are an entrepreneur currently struggling in your role and are looking for ideas and lessons learned that will help you succeed. 
5. You are the spouse or significant other of a recently failed entrepreneur and are trying to figure out what the hell he/she did wrong!
6. You are looking for a business book that is both entertaining and informative.

Okay, so let’s assume you fit one of these profiles. Here are my objectives to help you address your concerns: 

1. To talk those of you who are on the fence out of making a BIG mistake.
2. To help you “plungers” avoid some of the mistakes that I so effortlessly made along the way before you jump in.
3. To counsel you folks who are failing, or have already failed, by commiserating with you. Basically, I want to talk you down from the ledge.
4. Someone told me that licking my wounds in public would be really good therapy. Maybe those who can’t do really should teach. Hmmm, novel idea.

In the following chapters, I will explain my thought process leading up to my decision to start Yellow Brick Road Entertainment LLC and throughout the life of it. I will then share my specific 2005-07 circa business concept, which was BandDigs.com, an interactive video platform/community for the music industry—a cross between Myspace and YouTube. 

Subsequently, I will drill down on everything from the business plan, funding model, financials, technology, marketing analysis, customer base, vendors, and alliances, to the adjustments my team and I made, the investment banking process we followed . . . and, SPOILER ALERT, to the eventual closing of the business. 

The meat in the sandwich, however, will be the brutally honest lessons learned that I will share with you. If you run with just a few of these tidbits, your ROI on this book purchase will far exceed 10,000 times. 

The lessons in this book will address topics such as who you should choose for investors and why, how to write your business plan, how to know your customer, how to better develop your product or service, who not to hire and why, what types of vendors to avoid, and how to deal with angel investors, strategic funding sources, and VCs to avoid being turned down for an early round of funding. I will even share lessons I learned about myself as a person, which I hope will help you sort out your own feelings and better deal with your own struggles and doubts.

Finally, I will tell you about the aftermath—shutting down a business and facing failure for the first time. Will you be able to look at yourself in the mirror and not think of strangling yourself if you go down in flames? What will it be like dealing with your investors, friends, family, and your health if the business shuts down? Ouch… sounds rough, doesn’t it? But here’s the bright side: my pain may very well turn out to be your gain! And that is my goal for this book, and for you. 

Hopefully, by sharing the consequences of my actions, you will be able to leverage my mistakes into a much better outcome for yourself. If it is too late for that, maybe you will find solace in relating to my pain and it will ease your own. 

With all of that in mind, let’s start by defining what an entrepreneur is. Here is an excerpt from an online definition of “entrepreneur”: 

An entrepreneur is a person who has possession over a new enterprise or venture and assumes full accountability for the inherent risks and the outcome . . . Entrepreneur . . . is a term applied to the type of personality who is willing to take upon herself or himself a new venture or enterprise and accepts full responsibility for the outcome.. . . They are successful because their passion for an outcome leads them to organize available resources in new and more valuable ways . . . A person who can efficiently manage these factors in pursuit of a real opportunity to add value in the long-run, may expand (future prospects of larger firms and businesses), and become successful.

Entrepreneurship is often difficult and tricky, as many new ventures fail. Entrepreneur is often synonymous with founder. Most commonly, the term entrepreneur applies to someone who creates value by offering a product or service. Entrepreneurs often have strong beliefs about a market opportunity and organize their resources effectively to accomplish an outcome that changes existing interactions.

Picking apart the word entrepreneur is a crucial aspect of making your decision to “join the club.” Indulge me while I ask you a few questions to lay the foundation:

• How much money can you afford to lose without it impacting your lifestyle, home ownership, and/or your family obligations, i.e., kid’s college funding?
• Are you prepared to fail? Can you live with yourself if your venture crashes and burns? Will your spouse or significant other and children forgive you?      
• What is your backup plan, and how long will it take you to implement it? How long can you afford to work for free? 
• What event in your business would trigger you to start looking for another job? In other words, what would drive you to quit your new entrepreneurial venture and return to the workforce?
• What is your motivation for starting a new business? 
• Do you have qualified people whom you trust lined up for hire?
• What funding sources will consider your business plan, and why do you think they will prioritize your plan over the hundreds that they look at every month?
• How well do you know the market that you are contemplating going into?
• Are you really capable of running your own business? In all honestly, could you run the company that you are working at now? 
• Are you disciplined and organized? Do you procrastinate?
• Can you sell . . . and I mean, really sell? Not only will you need to sell your product or service, you will need to sell your ideas, which can be even harder to sell.
• Are you prepared to work for several bosses, i.e., your investors?
• When you picture running your own business, how much time do you think you will need to work each week? Are you prepared to work long hours seven days a week for the first six to twelve months?
• How will you define success in your venture? 
• Have you shared your plan with at least three objective parties who understand the industry you are targeting?
• Can you succinctly describe your business concept and the ROI opportunity to a potential investor in three to five minutes?
• Are your people skills top-notch? 
• How well do you deal with confrontation?

This list scratches the surface of the qualifiers for becoming an entrepreneur. Before reading further, please objectively answer these questions for yourself and your potential investors. Pause and reflect. Repeat.