1. Do not ever start a business, which you don’t enjoy doing .
2. In short term, profit is not important. Liquidity is important. Companies don’t go bankrupt because they are making loses (in short term), they go bankrupt because they run out of cash, simple as that.
They don’t have money to pay, they need to get more in debt, resulting in paying higher interests, lower credit score, lowering trust of suppliers… It is a vicious cycle. Is profit important at all? Sure, profit is important, but the most important is liquidity, never forget that! You can make short term loses or produce long term 0 profit, but the most important thing is that you have cash. If you have cash, you can pay, you can get things from suppliers and you can get them at discount, since you can pay with cash.
3. Pick up top accountant, lawyer, suppliers and employees. These people can either help your business to grow or sink it.
4. Be very careful if you go into business with business partner. The best indic how he will behave, is to look at his proven past record. Unless this is somebody who starts his 1st business too and you trust him without question, you should pick reliable person, who had past succesful businesses.
5. Be patient. Business will in most cases not grow over night. Especially younger people with no experience before 1st business will expect profit soon, but this in most cases takes time. Years.
6. Do not finance your business with debt. No matter what business schools teach, how financing with debt is good, since you don’t use your own money, it is still debt after all. Sure, financing with own money can be more expensive, but you will sleep better, knowing that you don’t own other people money. Debt is huge pressure and especially when you start business you will have other pressures, you don’t need to pure oil on fire. Also, if it happens that for some reason business doesn’t work out, you don’t end up with debt.
7. You will have to take care of all little details. Nothing will be “made by itself” at the beginning. If you want to open restaurant, you will have to know how to cook, how to negotiate prices for food, what prices you will charge for menus and all other details. If you want to start a web page, you will have to learn how domaining is working, how to upload files, how to do some programming and photoshop and things about your web content. Later, when business grows and start making profit, you can outsource or hire employees for that.
8. Don’t give up, but be open minded for alternatives. It will take time to make business profitable, but if you are keep losing money for the long run, sometimes it is better to call it quit and invest in something else. Am I saying to quit? No, definitely not, but have a holistic approach. If this business was a bad idea, making you only lose money over a longer period of time, perhaps it is time to start something else.
9. Be ready to live cheap for months or even years to come. If you live comfortable, this ends when you start your business. There will be countless sleeples nights, when you will try to figure things out. Also, unless you start online business, you will have to invest money. That means if you are not rich, you will have to give up comfortable living for time to come.
10. Be proactive. Don’t wait for miracles to happen. You have to work on your business every day. Forget about holidays, partying and wasting time. You can afford this, when business is up and running. Most likely first couple of years you can’t do any of that.