There is no such thing as a “traditional” entrepreneur. We all have different backgrounds, skills, and interests that shape our journey to entrepreneurship.
One person might start his career as an engineer while another might be a seasoned finance professional before going into business building websites.
It’s important to reflect on the different ways we begin our entrepreneurial journeys because how we get started can lead us ahead in many ways including what kind of start-up ideas we choose to pursue and where they take us in the long-run.
When I started my first business, I thought about whether or not the venture would be successful from a financial standpoint.
As a young professional and entrepreneur, I was interested in the monetary potential of my idea. I wanted to run a company with a big paycheck. However, believing that money would be made as quickly as possible also led me to starting with a “low-cost” business model.
Orzare has some more information about A Liberal Start-Up Story & What Leads Us Ahead.
Here are some points discussed-
1. Starting with a low-cost business model
Many entrepreneurs want to start businesses that generate capital quickly, along with substantial profits. However, the idea of starting with a low-cost venture typically doesn’t strike the entrepreneur until much later in his or her career.
I actually didn’t even consider the idea until after my first company failed. At that point, I was interested in cutting costs and figuring out a way to try again for free (or nearly free).
But why would you want to start a business without capital? When we begin thinking about ideas to create an income stream, we often think big and assume that we need funding to pursue our big ideas.
This is true, to some extent. However, starting a low-cost business doesn’t mean your idea has to be small and limited in scale. In fact, you can pursue ideas that are so large in scope that they require very little capital or startup cost.
2. Starting with a high-cost business model
Many successful businesses have been created through higher-cost methods of operation. For example, Facebook started as a high-cost venture from day one because it was created by college students who had no sense of what they needed to get the job done (other than access to the Internet).
Other entrepreneurs who have chosen to start businesses with high start-up costs include Apple Inc. founders Steve Jobs and Steve Wozniak, who decided to invest in expensive computers and equipment at a time when both were relatively inexpensive.
With less than $1,200 dollars invested or the equivalent of one good computer they were able to put the first Apple computer together and begin selling it at a local store. Even though this seemed like a big investment back then, they ultimately made big money because they had started their business with an idea that could scale bigger than the initial start-up cost.
3. Starting with a middle-cost business model
There is also a third option when it comes to the cost of starting a business. This idea is to build something that requires some investment in order to get started, but not so much that the business requires the financial support of other investors or the founder’s personal bank account.
It’s important to note that this third approach is often overlooked by many entrepreneurs when considering where they want to start their company. This can be costly, because starting at this middle-cost level allows you to try out your idea and then make design changes before committing additional capital if required.
My own first business chose a middle-cost strategy, but we moved our business into the upper end before it even made a profit. Because I chose to build my company with an idea that could be scaled bigger than the initial start-up cost, I was able to consider an expansion option that saved us money in the long-run.
4. Starting with lower-cost businesses (regardless of what we start to feel)
So how did we end up with a “middle” starting point? As it turns out, this was due to how my business was operating at a particular moment in time as opposed to forming any type of plan around money.
In fact, we didn’t even know how much money we would have to put in our business before it was even running. It was only after we had already invested a lot of time and energy into our business (and were well past the “middle-cost” point) that I reflected on the start-up costs