DEAR WW: After many years of tinkering, I’m ready to launch my own business. What are the keys to success as an entrepreneur?             – DUMP THE BOSS 

DEAR DUMP: Your question reminded me of a time that I was at a street fair with my then 5-year-old daughter, Hallie. She really wanted to buy a doll. I asked her if she would be willing to buy it with her own money. She thought for a minute and then said no. I’ll never forget the look on a woman’s face who was standing nearby; she couldn’t believe that such a little kid could be so realistic.

Entrepreneurs need to ask the same question of themselves – would you get out your checkbook to invest in you? I know most of you would scream, "Yes," but it’s important to get past your bravado and explore whether you are really worthy of someone else’s hard-earned cash. I’ve listed three do’s and one don’t below to explore other key aspects for entrepreneurial success. For more, check out Confessions of a Serial Entrepreneur by Stuart Skorman (Wiley, 2007).

DO know your strengths and weaknesses: If you need working capital, people will not only be investing in a business, they’ll be investing in you. How insightful are you about what you do well and what you don’t do well? And what resources will you draw on to compensate for your weak spots? Don’t feel guilty here; we’ve all got weaknesses and blind spots. The issue isn’t about avoiding them, it’s about managing them.

DO be financeable: Sure you’ve got a few relatives and friends who would be delighted to throw money your way. Is it any surprise that they call this type of funding ‘angel financing?’ But you’ve got to look past the angels to ask tough questions about your financeability in the real world. Outside of friendship or family, is there a reason for strangers to invest in you and your venture? Have you taken a realistic look at the competition? Have you targeted an audience that not only wants your service but is in a position to pay for it? Will you make money?

DO know when to pull the plug: Sure you’ve got to be driven and believe that your business will succeed. Why else do it? But at the same time you’ve got to be realistic about the prospects for your venture. Establish specific benchmarks that your venture needs to reach for sales, market share, etc. Then keep track of how you’re doing. If you are coming up woefully short, it’s important to be willing to pull the plug rather than continue to throw good money after bad.

DON’T build the business solely around you: Most organizations are a reflection of their leader, and an entrepreneurial venture is no different. That said, it’s important to look beyond your own skills to involve other players who will add depth and complement your abilities.

My daughter knew how to answer the hard question about her purchase. Are you willing to do the same for your venture?

LIST OF THE WEEK

from Real Success Without a Real Job by Ernie Selinski (Ten Speed Press, 2006)

Worst uses of your time:

• Doing what everyone else is doing.
• Complaining about your situation.
• Criticizing others, particularly those who are rich and successful.
• Watching television.
• Gossiping and talking on the telephone.

THOUGHT OF THE WEEK

"All generalizations are false. Including this one."                    – Alexander Chase