The Hard Truth You Must Know as a Business Owner

Over years of operating businesses, entrepreneurs may gather many lessons about how to grow and run a business more effectively. If you are a new business owner, you can study from them.
The Hard Truth You Must Know as a Business Owner
Image credit: Kari Geha Photography
By | 3 min read

What do you need to know as a business owner? Originally appeared on Quora: the place to gain and share knowledge, empowering people to learn from others and better understand the world.

I graduated from an Ivy League school and a prestigious business school and have being involved in 12 business startups (5 of which I funded 100%) over the past 25 years. I’ve also consulted for business startups and was a business broker for about 5 years. I’ve seen the starts and the happy endings – as well as A LOT of failure along the way. Here’s what I’ve learned – “knowledge” is only about 10–20% of the equation. While there are many basic things you should know to start a business (see my business plan section below), you’re real focus should be on what you actually need to “create and own a successful business”. To own a successful business, make sure that you have these skills and personal attributes:

  1. An incredibly work ethic (“grit”),
  2. Discipline,
  3. The ability to learn and adapt (very quickly)

Off course, you’ll also need a decent business plan and enough money to reach a specific financial milestones but the 3 items above are probably 60–70% of the equation. If you believe you have these, then starting a business is relatively easy – assuming you’re written a business plan (see below), then just select an ownership structure (sole proprietorship, LLC, corp), file your paperwork, find a location/office, start selling your product/service and voila!

The business plan: in terms of straight “knowledge”, learning all the aspects of a good business plan are paramount. But, don’t think that you need a 50 page treaties on every detail of the business. You can write a business plan on a single page of paper. It’s going through the thinking process that is most important, and should always answer a few basic questions:

  1. What is my product and how do I make sure it’s awesome (operations)?
  2. Who and where are my customers, what do I know about them, and how do I sell to them (marketing)?
  3. How will I let them know I’m in business (advertising) and how will they buy my products (sales)?
  4. How much will I charge for my product/service and how much will I make from every sale (finance/accounting)?
  5. Where will I have my office/shop/store and how will I manage it (administration)?

That’s it – if you can answer (and verify your answers) to these question, and you believe you have the personal attributes I described above, then you have 80-90% of the knowledge you need to start a business. The other 10–20% is the stuff that no one knows before you start, but you’ll learn as you go (and adapt quickly). Good luck!

Contributed by Cesar Hernandez, Business Owner / CEO, Serial Entrepreneur, and Father

Topic:
  • Quora is a website where you can post any question and get real answers from people with firsthand experience. It is the place to gain and share knowledge, empowering people…

Join other small business owners in United States who receive insights and updates to improve your online presence.

90% of small businesses fail to build online presence due to the lack of diverse support from in-house resources.

Sign up for an online presence manager today!