3 priorities when starting your business

There’s no time like the present to start a new business. In the coming years and decades, we are likely to see a surge in innovation and economic activity due to people having more time, either by choice or by circumstance, to think about and solve big problems.

According to recent data from the US Census Bureau, there have been nearly one million more new business applications in the United States in 2020 compared to 2019. This increase represents a 27% change in applications and the largest year-over-year increase in the past twenty. It is an exciting time to be an entrepreneur.

But starting a business can be as terrifying as it is exhilarating. There is no question that your newfound freedom and independence, unique ability to solve a problem, and potential for a better livelihood are big motivators to strike it out on your own. Unfortunately, you’re facing tough odds. Two in 10 businesses fail within the first two years (per the US Small Business Administration), and that number rises to five in 10 after five years.

As capable, confident, and committed as you might be, there’s more than a 50% chance that if you choose to start a business today, you’ll be doing something different within five years.

The good news is that you can improve your odds by prioritizing three critical things at the outset of launching your business: yourself, your product or service, and your customers.

Priority #1 — YOU
When you first launch your business, this might be the only time that an in-depth focus on yourself is possible. Once you get rolling and the money starts flowing, it will become increasingly difficult for you to carve out time for reflection and self-awareness. This top priority is so often missed by entrepreneurs yet is so vital for their business’s success.

Prioritizing yourself in the early days of your business serves several functions. It helps to align your values with your goals, and it enables you to identify and use your strengths to their fullest advantage (and conversely, promotes better awareness of your weakness and when you should ask for help). It also provides you with insight into where you need to slow down and be methodical with your decisions or use your intuition to make high-quality decisions on the fly.

Starting a business is not for the faint of heart. But do not despair. The rewards can more than make up for the challenges—if you succeed.

Here are three easy steps you can take to dramatically improve your self-awareness as soon as you decide to launch your own business:

1. Complete a personal values assessment — These values will guide you through experiences and situations with which you’ve had little to no experience, as is often the case when you first start a business. Your values define who you are and what you want (not necessarily what you have). When coupled with your strengths, it’s your values that make some of the most demanding tasks that much easier. Keep your values list short—five items or less, and know (and have conviction about) the first three.

Power up tip: Used a paired comparison or similar process to rank your values so that you know those at the bottom and top of your hierarchy of values.

2. Complete a personal SWOT (strengths, weaknesses, opportunities, threats) assessment, focusing mostly on your strengths and weaknesses — Your strengths are the things you do well or advantages others don’t have. Your weaknesses are things you don’t do well or don’t like doing. These may relate to decisions and tasks that you assign to others, or you may choose to work on these weaknesses as you’ll need to overcome them when you’re doing 90% of the work in your business in the early days. (Opportunity, at the early stage of launching your business, is your raison d’être: this why you’ve decided to shake up your world and become an entrepreneur. Threats are the obstacles that will prevent you from achieving your visionary goal).

Power up tip: Review your SWOT with someone you trust and listen to their feedback (bite your tongue and open your ears, you will learn a lot).

3. Define your visionary goal — This is a simple, easy to understand, and communicate statement about the mountain you want to climb for your business. Ask yourself—what do I want my business to be?

Power up tip: Conduct a pre-mortem (look into the future, and your business has failed) on your visionary goal to develop reasons and solutions as to why you didn’t achieve your goal.

Priority #2 — MVP
Your MVP (minimum viable product) is the product or service you believe: a) solves a problem, b) is valued by your potential customers, and c) will make you money. This is a version of what you intend to bring to market when you launch your business. But it may not be the actual product. That’s the beauty of an MVP: You create something and test it out with your potential customers.

The people buying your product are your business. Without them and their problem(s) — you are attempting to solve — you have no business.

Suppose you spend an excessive amount of time perfecting your first product or service and end up pivoting to a different solution early in the life of your business. In that case, you will have wasted this time perfecting when you could have been selling or learning.

In an analysis of why start-ups fail by CB Insights, the number one reason new ventures fail to take off and become established as a meaningful enterprise is that there’s no market need for the product or service. An MVP approach allows you to address this significant barrier to success for your business head-on.

Priority #3 — Your Customers
The people buying your product are your business. Without them and their problem(s) — you are attempting to solve — you have no business. No sales, no profit, nada. Here are a few questions you can ask your customers, paired with the MVP approach:

Listen, and really listen to their feedback. It is alright if you don’t agree with everything you hear. Ultimately you will have to decide whether or not to include your customers’ suggestions in the next version of what you offer them. But know that the deeper you connect with your customers, the more they will value your commitment to them and reciprocate that commitment at the point of sale.

Starting a business is not for the faint of heart. The hours are long, the pay is not great (especially early on), and self-doubt can be nearly debilitating. But do not despair. The rewards can more than make up for the challenges—if you succeed. By prioritizing the right things at the early onset of your endeavor—yourself, your product or service, and your customers—you better position yourself for success.

Luke Sheppard, author of “Driving Great Results,” spent 20 years in the construction and forestry equipment industry, starting as an adventurous machine test engineer in the pine forests of Alabama and most recently as the VP of Customer Support with Nortrax, a John Deere company.