Beware of bad advisers

Recessions always seem to result in an increase in the number of people starting businesses. This is a good thing. At the same time, the Internet seems to have exploded with the number of people claiming to be experts in advice or consultancy for entrepreneurs. This article has been written as a result of the growing problem of entrepreneurs being taken advantage of by unqualified or outright fraudulent advisors and consultants. This is the first in a series of articles addressing how entrepreneurs can reduce their risks and costs while maximizing free resources and information, such as how to achieve search engine optimization (SEO) or marketing without paying a penny.

1. Companies, services, scams and unqualified consultants or advisers
2. what information is free
3. When should you be paying for a qualified adviser and how to tell the difference between fluff and real expertise?

Companies, Services, Scams and Consultants or Unqualified Advisors

Scam artists, unqualified advisers, and marketing predators often offer quick income tips, promises of internet traffic, fundraising guarantees, or business and marketing plans. Others try to sell you information through webinars, eBooks, seminars, or classrooms that can be found online for free. It’s critical that if you seek advice, you speak to someone who has performed all of the functions of a startup many times, not just a part. If you wouldn’t ask a store clerk how to handle engineering problems, why would you even listen to a social marketer tell you how to set up your business? More on the identification of contenders will be discussed in a future article.

Being”an entrepreneur” is a way of thinking. The ability of someone to sell a product, good or service does not make them an entrepreneur or even a qualified adviser, the ability to sell makes them a good salesperson. An entrepreneur recognizes the opportunity, develops a plan to capitalize on the opportunity and implement that plan to make the business a reality.

When starting or running a business, entrepreneurs have two main hurdles to overcome. The first problem is, of course, “How to do” or the ways to start a business. Information, advice and resources describing the ways to start or run a business are available online at various private and government websites or in person at a local hub such as the Development Center from Small Businesses, SCORE or other Microenterprise Development Centers for FREE. You don’t need to pay a dime for this guide. To make use of these resources, it is always better to think about your idea first before making any contact. No one is going to think or should be thinking of your idea for you!

Checklist for thinking about your idea : Who, What, Why, Where, How and When

• Identifying what business you will be in?
• Why will you be in that business?
• What is your market?
• How big is the market?
• Who are your competitors?
• Why would consumers buy from you instead of someone else?
• How will you go after your customers (developing a marketing plan)?
• Who is going to do the work, have a team, and is emotionally and financially ready?
• Where will your business be (physical location, online, at home)?
• How will you finance your business?
• When are you going to start your business? Will it be part time or full time?
• What is your passion?
• What resources do you need to move forward?
• Where will you look for resources?
• Where’s your head?

Answering the above questions before you talk to anyone will help you because you now have the building blocks for a business plan and can explain your idea to your closest friends and advisors in a more organized and concise way.

For now, avoid at this stage:

• Have someone do your business plan for you. Business plans come in all shapes and sizes. Some are used only as a guide to actionable items and some are used to raise capital. You don’t need a business plan to start a business. You may need one in combination with a “Road Show” presentation and other elements to raise capital.
• Pay for the following types of services (marketing, SEO optimization, accounting software, promotional items (other than business cards), classes on how to set up a website or blog, fundraising, lead generation, books, seminars, payment networking sites, etc.). I repeat: Marketing and other SEO tips and tools are available for FREE.

Why?

1) Because your first money must be used for the legal and physical development of your good or services such as registering the business, obtaining the corresponding licenses, registering a domain, Intellectual Property (IP) if necessary, selection and purchase of a web format. Note. Many web page designs are free, others have minimal costs involved. There are countless tools and plugins available for free or for minimal amounts that can guide you through setting up a website.

2) “Cash is King”, Your ability to manage cash early on goes a long way to your credibility if you are raising money for growth or development.

What you might be paying for at this stage is:

• Professional experience in the type of business to be established (Corporation, Sub-Chapter S, Limited Partnership, Sole Proprietorship)
• Intellectual Property Fees – If your company will have intellectual property, get professional help from a company that can provide you with references. No references = no verification. Don’t be fooled by the excuse that they don’t disclose customer information.
• Market research, competition research. This is important to understand who your competitors are and why they might buy from you. Market research can be time consuming, however it is critical if you are a home-based business, a service business, or have a new product.
• Assistance in developing cash flow, capital requirements, spreadsheets, budgets, etc., if you are not very good with numbers.
• Engineering assistance for technical development.
• A person who can review your plans. The plan review is very important as the excitement of a new idea often leads to monitoring key questions. Make sure the person you talk to has not only the experience, but also the education to be able to provide you with the latest knowledge base and business development tools.

Be very careful with any contact who makes promises of success. No one can guarantee fundraising success, market share, internet traffic, sales, store traffic, etc. During the planning stages, you may pay for tasks, but not for future promises.

The second big hurdle an entrepreneur faces is being emotionally prepared for the journey. Read “Riding the Emotional Roller Coaster of a New Business” to understand the emotional roller coaster headed your way. Underestimating the impact a struggling startup can have on your lifestyle, your family, or your mental health can lead to the bankruptcy of a business almost as quickly as its cash flow dries up. If you are willing to pay for this service, there are a few questions to ask yourself before hiring a consultant, life coach, or advisor:

1. Have they all failed?
2. Why did they fail?
3. What did you learn?
4. How did the cash flow affect your lifestyle?
5. How are the top and bottom of the roller coaster managed?
6. Are you willing to tell me what I need to hear and not what I want to hear?
7. Will you be there when I fall?

Too often, life coaches, business coaches, and consultants have never experienced the difficulties of starting and running a business. too many”experts“Claim 1-3 successful businesses and a book, but you’ve never experienced the hunger it takes to train and develop an entrepreneur. Don’t let your excitement about starting a new micro-business or start-up cloud your judgment.