Call it whatever you want, but you must be insane to go out on your own.
“OK Derek, why are you being so negative?” I’m not. I am being blunt. And if this is not your cup of tea, this would be a good time to bounce — this article doesn’t get prettier from here on, or will it?
Over 90% of startups fail in their first year.
Reasons for their demise range from financial mismanagement and bad hires to competition and lawsuits.
It doesn’t matter what industry you look at, startups throw in the towel more often than you’d think.
Everyone launches a company with grand plans
You’re absolute right. What kind of a business owner are you if you started a company without any lofty goals?
Entrepreneurship is on the rise in the recent years. The explosion of new and affordable software — marketing, accounting, sales, content, social, etc — has significantly lowered the barrier to entry.
But that also mean that the number of failures will undoubtedly increase. Again, I’m not being negative. It’s actually very scary, but logical.
The unseen obstacles of entrepreneurship lurks in the dark
Many common obstacles you hear about revolves around strategy, planning, and execution.
They are solid advice given by some of the most successful entrepreneur role models.
Gary Vaynerchuck probably comes to mind for many of you.
But the scariest for entrepreneurs are the unseen obstacles that creep up on you when you’re unaware.
They are challenges you didn’t think would be thrown at you.
It’s the feeling of self-defeat that you didn’t see coming, or not having the emotional strength to handle failure, or the resolve to persevere through the most difficult personal life changes.
Out of sight, out of mind
I would love nothing more than to believe that every entrepreneur is mentally aware of those unseen obstacles.
But the truth is, in my opinion, that many of you are too busy trying to build a business to have time to care about anything else.
What you don’t see in front of you is usually ignored.
And by the time you see it, for many, it’s too late. Especially if this is your first business venture.
In my 18 months of launching my ad agency, I have experienced several of these.
I’ll share them with you. I hope you can spot them before it does damage.
Obstacles I faced as an entrepreneur
Here are the 6 most damaging curve balls that knocked me down (thank God I recovered).
1. Taking a huge hit on my credit score.
This one is huge. I worked hard for years to be in the 700s.
Unfortunately, my score dropped to the mid 400s. Yes. That’s right. I should be ashamed and keep this private.
Instead, what I’ve come to realize is that I may not be the only entrepreneur in this situation.
Hopefully this can serve as a precaution to you.
I didn’t see it coming because I was absorbed. Should I have been more diligent and responsible? 100% Yes! No arguments here.
When I launched the company, I leveraged my credit cards in more ways that I care to count. I thought I could handle the credit card bills when they are due. And yes, for a while I did.
Things changed rapidly. I lost a couple of clients. Yes, you are guaranteed to lose clients along the way in any business.
I was too focused on chasing clients and building the business that I neglected everything else, in this case my payments.
Payments started falling behind. It compounded and crushed me.
There’s no excuse. I failed miserably here.
Surviving without over-leveraging your finances is equally as important as trying to grow your business strategically. It’s not one or the other.
I’m not a financial adviser, obviously.
It’s obvious, but often neglected. Track what you’re charging on your credit cards like a hawk during your early years of your entrepreneurship.
Stop justifying your spending.
2. Distancing yourself from loved ones.
Everyone was excited when I decided to launch Fullmoon Digital.
After 17 years, this was a dream come true.
As the grind got tougher, I began to distance myself from my family. Not intentionally. But I felt I needed to invest every waking hour on the business.
In my mind, if I stopped for even one hour, then I am missing the opportunity to write another article, post another video, engage in a post, connect with another professional, or nurture another lead.
I thought I was sacrificing every minute and hour to build a better future.
Truth is, the business consumed me. By allowing it to happen, it took away time and attention from loved ones.
As much as you hustle and grind, be mindful that you must ALWAYS find time to have fun and do awesome things with loved ones. This is a huge lesson I am still teaching myself as I go into the second year of Fullmoon Digital.
Your business is important. No disagreement there. However, unless you can bring loved ones along on the ride, it’s going to be a very lonely journey.
3. Dramatic changes in your lifestyle.
Prior to going all-in with my agency business, I had a well paying 6-figure full time job. In addition to that, I was consulting on the side and bringing in another 6-figure side hustle income.
Life was good (at least the money was).
But when I pulled the trigger and decided to leave the corporate world, things quickly changed.
For a hot minute, I tried to maintain the same lifestyle we had but that was futile — it was primarily driven by my unwillingness to accept the changes that are starring at me right in my face.
Whatever your previous lifestyle is, you need to accept that your entrepreneurship journey has no room to accommodate it any longer.
Why?
Because it’s no longer about how well you live. Instead it is redefined and calibrated to the purpose of what you life for.
4. Broke is the new you.
I’m not saying you have to be broke to be an entrepreneur. But accepting that you will have financial set backs is common.
During the course of running my own business, I have experienced having money to being broke to having money to being broke again.
There are many people who will tell you that IF you managed your cash flow then you shouldn’t worry about this.
Every successful entrepreneur you come in contact with, or you’ve read about, or heard about have been broke before their rise to fame. So let’s not sugarcoat entrepreneurship any longer.
But being broke is a temporary physical state. That means you are generating income, just not enough to create surplus.
Instead of being ashamed of being broke, use that as your fuel to work angry. I don’t mean go insane and start being irrational.
Working angry means you are constantly fighting, aggressively, giving it all you’ve got. Ignore doubters, avoid losers, and stop listening to naysayers.
Trust me, it’s better to be broke than poor.
5. You will be driven to the brink of a mental breakdown.
This is inevitable for many entrepreneurs.
It has nothing to do with you smart you are. The stress and pressure to succeed is daunting. You’ve given up everything and committed to building your business.
Things will go wrong. You will make mistakes. People will betray your trust. At some point, anybody who bleeds red will reach their mental limits.
Nobody in this world is a superhuman. Sorry.
I believe part of succeeding is admitting your limitations. And when you feel you are approaching your breaking point, ask for help.
You don’t need anybody to butter you up and tell you “it’s OK, and you have superpowers.” In fact, you want to surround yourself with people who are truthful and brave enough to tell you that “it is OK to not be OK!”
Don’t kid yourself. It’s time to get real. From my experience, it’s better for you to mentally prepare yourself for this breakdown. If it happens — you will be more equipped to handle yourself and the people you surround yourself with.
6. Being judged because you have an opinion.
With entrepreneurship comes freedom. Not the “I do whatever I want whenever I want” kind.
I’m talking about the the absolute freedom to share your views, voice your opinions, and be as transparent as you want about any topic.
While you enjoy this freedom, you will be judge more critically for what you say, how you act, and what you do. You have lifted the veil of corporate protection.
My friends, that’s the trade off for being an entrepreneur.
Just scroll through LinkedIn and you will see how many entrepreneurs sharing their business struggles, stories, milestones, and successes.
But more importantly, they take it one step further and freely talk about their personal life challenges — depression, anxiety, heartaches, suicide, sexual orientation, mental illness, hurt, loneliness, etc — knowing that there will be both support and backlash.
Now, if you were working for a company and posted about grievances, you’ll be summoned to your HR office in a heartbeat. And the next thing you know — you’ll be walking out with a brown box.
As entrepreneurs, we enjoy a unique type of freedom that comes with a hefty price tag.
It’s our burden to carry throughout on the road we choose to walk. Whether you’re a million dollar or multi-million dollar business, your critics will never go away.
Conclusion
This article wasn’t easy for me to write. In fact, it’s by far one of the most challenging one for me.
It’s personal. A constant reminder of the hardships of starting a business and the hidden challenges that is rarely discussed — because it’s not as “sexy” as the other stuff.
Nonetheless, if this article resonates with even one entrepreneur, then I am thankful that my personal experience and calloused feet is making an impact.
