Entrepreneurship
Benefits of Pursuing Entrepreneurship
“I really enjoy, personally, building things, and growing and learning; I enjoy autonomy and having the ability to work on things that I am passionate about and enjoy. Entrepreneurship offers that. I wasn’t strictly focused on entrepreneurship–I wasn’t opposed to working for someone else. However, I really enjoy autonomy and building things, and I felt that entrepreneurship was an intersection between those things.”
“As I grew older, and I got more experienced, I realized that there is a lot more excitement that I get from entrepreneurship, and owning and running my own business. It is much more than what I get from working for a large corporation; I have worked with many large corporations in the past, and while they have their pros and cons, I truly feel that my heart and passion is in working for myself.”
“When we first got here, our English wasn’t very good so it was difficult for us to find jobs. We had a friend who owned a restaurant. As there was little language requirement, we were able to work as waiters and eventually bartenders. Eventually we realized that while working for somebody, although we were making money, it was only a salary. As we were raising two kids, that money wasn’t enough to support living.
They realized they must start their own business to potentially earn more money and take better care of the family.”
“I did work for someone else to get experience, but especially with hairdressers, the ultimate dream is to work for yourself. You can control everything – your hours, how much you work, your clientele. Flexible hours is a huge benefit.”
Getting Started
Find a problem to solve that you’re passionate about. Validate it exists & is solvable
A problem worth solving is one that has noticeable negative effects on someone’s experience or circumstances. It is one where a solution is possible; a better alternative that can offer a more beneficial outcome than the current system.
Passion is an integral component of finding the right problem for you. Even if you don’t have a lot of prior knowledge on the subject/industry, if you are passionate, you will have no trouble or inconvenience taking the time to learn more. Furthermore, passion is a key contributor to dealing with failures, and trust me, you will inevitably face failure.
Interviewee #1 got the idea for his company from his prior experience in the hotel and apartment world as both an investor and traveler. He notes that,
“As an investor, I saw that the way that these properties were managed was very inefficient, and as a result of some factors, the profits were much less than they could be. As a consumer, I was really wishing that more and more hotels felt “modern.” I felt that through starting my business, I could solve these problems as both a host and a guest. “
Interviewee #2 grew up assisting his parents–who were already in the hotel business–with translating English to Chinese. He notes that “by the point I was a senior in high school, I began becoming more aware of the world. I found myself helping them with conference calls, emails, understanding contracts, and forming negotiations. So that is really how I discovered the hotel management world.”
Through his close-hand experience with the niches of his industry, he began to notice areas where improvement was possible. He decided that he not only wanted to grow his parent’s business, but also innovate it to be more “institutionalized and sophisticated.”
Interviewees #3 and 4 reflected upon their situation, their skills and limitations, and ultimately decided that opening a restaurant had the most potential for success. Significantly limited by language barriers and difficulty finding livable employment, running a restaurant was a very viable option. They further cultivated their skills for management and cooking through experience and learning from friends.
Interviewee #5 had always envisioned starting her own salon. However, unexpected circumstances thrust her into the world of entrepreneurship earlier than she anticipated.
“My previous salon got bought out; management changed and things weren’t really working the same for me. Although starting my own salon was always a dream, I had to do it a bit sooner than I foresaw.”
Educate Yourself
Having a strong knowledge about the problem you want to solve and your actionable solution are strong factors to success. There is no specific way to do this. The business owners we interviewed had a wide variety of methods they used to become familiar with their business and/or industry, as well as the general process of becoming an entrepreneur.
Interviewee #2 attributes a lot of his familiarity with the hotel industry to his time spent with his family. Interviewee #1 is a big proponent of books and podcasts. Interviewees #3 and 4 built their knowledge and comfort about the restaurant business through experience over many years. Interviewee #5 developed her expertise as a stylist by taking specialized training classes.
In addition, all of these business owners highlight that there is so much to learn from others. This is why it is equally important to build a strong network.
Network – surround yourself with other entrepreneurs & experts in the field
Networking is possibly the most important thing an aspiring entrepreneur can do to set themselves up for success. You can learn so much from the people you surround yourself with, and building connections is the best investment you can make–it will undoubtedly pay off. You can unlock numerous opportunities, further establish your brand, and cultivate relationships with potential investors. Each of the business owners noted this.
For example, in addition to his involvement with his family business, Interviewee #2 states that,
“I also made sure to take initiative–no one is going to hand you anything on a silver platter. Thus, it is important that I seek out the support and resources that I need. If I realize that I am missing something, let’s call it a tool, I make sure I go ask people for advice or mentorship. I believe that this is an important part of any career, not just hospitality or entrepreneurship. “
Ways to do this
It is important to accept that building an impressive network will likely take time, as well as active participation and contribution to the network. Furthermore, everyone’s situation and circumstances can differ.
For Interviewee #1, he notes that it was “some times my Stanford network, other times I was introduced by friends.”
For Interviewee #2, he acknowledges that his “heavy involvement in the family business allowed me to meet people in the industry, so I was really lucky to have that opportunity.”
Interviewees #3 and 4 built their connections over time, from friends, other restaurant owners, and even their employees.
Interviewee #5 met many people from her stylist school, previous salon, and continues to meet new customers.
However, these are only a few examples and by no means indicative of the “best” way to network. Even if you do not have some type of predisposition or background experience/connections, you can still meet people and learn from them.
Funding
Securing the initial funding for your business idea may be one of the most daunting tasks in entrepreneurship. Here is how each of our business owners managed to start:
Interviewee #1: “Initially, I didn’t raise any money and we financed it ourselves–basically with a credit card. There was a lot of “sweat equity,” meaning putting in the hours instead of hiring people, doing a lot of the jobs myself and being efficient.”
Interviewee #2: “My parents were really successful in the restaurant business, and so it was really family and friends equity. That is great because you don’t need to worry about searching for a loan.”
Interviewees #3 and 4: “The only time we asked for help was borrowing some money from our friends and family. Sooner or later, after we had made some money, we paid that back. Their generosity was really the greatest thing that helped us start and eventually profit. We used the money to invest in tables, chairs, silverware, and other essentials to running a restaurant.”
Interviewee #5: “Because it is a small business, we didn’t really have to go out and take loans” We had money saved, so we were able to begin without outside help.”
All of these perspectives were ones of good fortune and possibly luck. However, looking for funding from sources with a closer connection to you is a very viable venture. Not only will you have an easier time convincing the lender and negotiating favorable conditions, but you may also lessen any negative impacts your immigration status may not have. For example, Interviewee #4 noted that it was difficult for him to obtain a loan due to not yet having a social security number. Thus, it demonstrably can be a very real challenge for immigrants to succeed in getting loan from an outside vendor, at least initially.
However, finding the initial capital is the hardest part – as your business develops (and hopefully sees success) potential investors will have more confidence in you and your mission. That is why in the next section, we will guide you through possible strategies for taking your business to the next level, including finding valuable investors.
Growth
Familiarize yourself with the business – learning legal requirements, etc
The amount of laws, requirements, regulations, etc that you must learn to run your business are largely dependent on your industry. Although it is important to understand them, don’t feel too pressured or daunted. You are not alone, and time will usually be on your side. Each of our interviewees have had different experiences in becoming accustomed to the regulations that had to follow.
For Interviewee #1, it was “an evolving process.” He states, “Initially, we operated in a gray area. Over time, we learned the correct processes, so now our properties throughout the US are all licensed.”
As for how he and his company gradually discovered these intricacies, he remarks that,
“I learned about these things in the same manner that I learned how to build the business. This entailed reading, talking to specialists, as well as trying and doing it myself. So, regulatory questions can be answered by attorneys who specialize in local laws, reading laws (which are published and ergo readable). There are also resources online about these topics, written by others. Lastly, working through it live and by doing was the approach we took.”
Furthermore, Interviewee #2 empahsizes how achievable such goals are. In his own experience, he has found that he doesn’t need to be an expert in all the laws. Rather, he only needs to have a general understanding. “when I talk to either HR experts or labor attorneys, I can understand what they are talking about and where they are coming from. So that foundation, I found to be really important.”
He further remarks,
“Really anyone can understand it. It’s not rocket science; anyone could spend some time working with a company, either an entrepreneurial or professional type of company, to learn these concepts. You don’t have to be a Harvard or Cornell grad to work in this space; as long as you put in the work to understand the concepts, anyone can pick up on them.”
Interviewees #3 and 4 reaffirm this through their own journey of coming to understand the various requirements around owning a restaurant.
“We ultimately learned about everything through doing, doing doing over time. Since we had tried to open a restaurant two times before, we had already become familiar with the procedures.”
“We knew how to do them. They weren’t that difficult, because although we couldn’t speak English very well, we still had a decent understanding of vocabulary. “
Furthermore, they make sure to note that they were not alone. There were others who were there to help guide them along as they learned.
“When we started the successful restaurant, the landlord of the space we wanted to rent out gave us the contract. That’s where a lot of the ‘regulation’ came from, mostly dealing with rental agreements.
As for permits, we had to notify the state government about what we were trying to open. They checked to make sure everything was safe and clean–there were a lot of procedures we had to do. We also had to get a license to distribute liquor. To get that, Interviewee #4 had to take a class for a certificate. “
Finding Investors
As you may recall, none of the business owners needed the help of investors to start their business. However, Interviewees #1, whose business currently operate on a national scale, eventually decided he would benefit from looking for investors. The additional money can not only allow you to further grow and improve your business, but also demonstrate to others (potential customers, other investors, etc) that people (the investors) believe in your vision.
“Eventually, two years in, we raised money through three venture capital firms. I got introduced to them through different people in my network; some times it was through my Stanford network, other times I was introduced by friends. Basically, two years growing it organically, and then later it was through people I knew that introduced me to my first investors.”
When you are seeking investors, your ultimate goal is to give them reasons to have faith in you. Interviewee #1 highlights that it ultimately comes down to:
- Being open-minded
“One of the most important things is learning quickly–adapting to the market quickly, and demonstrating to the investors that it’s happening.”
- Having a clear vision
“You have to know what the market wants, and as early as possible, seek to create a product that fulfills that. Furthermore, you must demonstrate a depth of understanding of the market sector, as well as the customer. This inspires confidence, and shows investors that you are the right candidate for the job. “
- Showing progress
“You have to recognize that there will always be risks, and it is pivotal to show progress against and despite these risks over time.”
Building a Customer Base
Interviewees #3 and 4:
“Always smile. We treated our customers very well. Customer service is crucial. In addition, our prices were very reasonable.
Although our English wasn’t the best, it became easy to understand what customers were asking for, as there aren’t a lot of hard words that come up. Also, customers are there to eat. They are very relaxed, so their English wasn’t that difficult for us to understand. “
Interviewee #5
“A lot of my clients followed me from my previous salon. Additionally, a lot of it is through word of mouth. A lot of clients referred me to family – moms would bring their kids, wifes would bring their husbands, friends would tell each other. Regretfully, I am not really good with social media, which I realize is a very powerful tool, so my client base grew at a slower rate than it could have.“
Keep On Going, Even When You Fail
Strangely enough, your failures may actually help your business become better. Failure is unavoidable – you can try to avoid them to the best of your ability, but the harsh truth is that you can’t prepare for everything, and sometimes you will have no control over what happens. However, what you do have control over is how you adapt, how you learn. Don’t get us wrong, failures can be crushing. It can be hard to pick yourself up and continue on. However, one of the most important qualities of an entrepreneur is resilience.
“First, definitely analyze the failure in a way where you are not just being hard on yourself, but understand the root causes, and try to remove your emotions from it. At the end of the day, there are plenty of reasons why something could have failed. The real question is if you spent the time to analyze the “why” and learn from it for the next venture? I think the most important part is learning from the “why.” If you don’t even take the time to reflect on the “why,” and instead just wallow in sadness, for example, I simply think that is not a good lesson. So, making sure you get smarter with each lesson, will make you a better entrepreneur.”
“I find the challenges to be fun; it would be less satisfying if there weren’t challenges (not that I hope for them). That being said, I hope that any future challenges we face will be indicative of evolution and success for the company. I believe that if we are doing well, there will be challenges, and if we are doing poorly, there will also be challenges–I wish for the former.”
Do things you don’t know how to do – don’t let the fear of not knowing stop you from trying. You will learn by doing. Recognize that your business may change – only time will show you what your business is truly meant to become.