Chapter 21. WORKING FOR YOURSELF

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Chapter 21. WORKING FOR YOURSELF
Should You Take the Leap? Do You Know the
Risks? How To Get Started
A. When is a Good Time To Start a New
Venture? 1. Personal Factors a. Inflated
expectations (See Personal Action Worksheet,
Text page 640) b. What do you really want to
be when you grow up? c. What are you giving
up? d. Credit e. Whats your fallback? f.
Energy sources g. Your Business Plan - Dont
leave your day job without it h. The Small
Business Administration (SBA)
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A. When is a Good Time to Start a New
Venture? (continued)
2. Economic Factors a. Growth or
recession? b. Specific industry trends c.
Easy money? d. Changing neighborhoods e.
While you wait
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B. Taking the Leap
1. The Legal Status of Your Venture a.
Temping b. Independent contractor c. Sole
proprietorship d. Partnership e. Corporation
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B. Taking the Leap, (continued)
2. The Start-up Choices for Your Venture a.
Where will you work? i. Leasing b. Purchase
contracts (in general) c. Franchise
contracts d. Buying an existing franchise e.
Buying an existing non-franchise business f.
Starting from scratch with a franchise g.
Starting from scratch independently h. Some
special consideration for professionals
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C. Where Will the Money Come From?
1. Personal Savings 2. Family and Friends 3.
Lenders 4. Built-in Credit 5. Governmental
Sources 6. Other Investors 7. Tax breaks 8.
Debt vs. equity
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D. Nit-Picked to Death by Regulations?
1. Employment regulations a. Tax matters b.
Employee well-being 2. Financial
regulations a. Credit matters b. Retirement
plans 3. Miscellaneous regulations
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E. Where to Get Help - The F.A.I.L.-Safe
Team and the MMs
1. The F.A.I.L.-Safe Team a. Financial b.
Accounting c. Insurance d. Legal 2. The
MMs a. Marketing b. Management 3. Seek and
Youll Find 4. Its Your Move
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TALKING POINTSChapter Twenty-One, Number One

• People whove offered to help you get started in
  your own business have given you several choices.
  Evaluate each.

• 1. Your parents will bankroll you with a
  no-interest no-collateral loan. Its a big part
  of their retirement nest-egg, so the loan must be
  fully paid in 3 years. OR, your bank will lend
  you what you need, at 8 per year interest,
  renewable yearly for 10 years at the going
  interest rate, assuming your payments are up-
  to-date. Your business, inventory and equipment
  will be collateral for the loan.
• 2. You can rent ideal space in a mini-mall for
  2,000/month. OR, your cousin Murray will rent
  you comparable space in his mini-mall for
  500/month, but he expects each of his 2 teenage
  kids to work for you at least 20 hours/week. And
  he will remind you of the favor and the
  requirement often.
• 3. A local P. R. firm will service your needs
  for 500/month on a 5-year contract. OR, your old
  pals, Pat and Fran, who have a public relations
  firm, offer to provide their service free in
  return for a share of your profits. They make it
  clear they will be on top of your day-to-day
  activities to protect their interests.

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TALKING POINTSChapter Twenty-One, Number Two

• Everyone who supports you in your new venture has
  advised you - and wisely so - to set a cut-off
  point. That is - if you havent met certain
  goals by a certain time, youll give up the
  venture and go back to working for someone else
  for a reliable wage. Evaluate and rate these
  possible cut-off scenarios

• 1. If your take-home income from the venture has
  not equaled what you were earning in your
  previous job within 3 years, youll give it up.
• 2. If, after 1 year, you run out of capital and
  have to borrow in order to meet your goal in 1
  above, youll give it up.
• 3. If, after 3 years, your spouse tells you that
  your venture is harming your home life and
  threatening your emotional or physical
  well-being, youll give it up.
• 4. If, at any time, you can honestly look at
  yourself in the mirror once a month for 3 months
  in a row and say, I am really not enjoying
  this, youll give it up.