The path you’ll take as an entrepreneur is going to be bumpy, stressful, and, hopefully, rewarding. Along the way, you’ll learn a lot about who you are and what you’re capable of, as well as how to balance the hustle with pleasure.
Much of the stress in your life will come from the decisions you need to make about your business. Whether it’s who to hire or which marketing strategy to pursue, nearly every day in your life as an entrepreneur will present you with a new, difficult decision.
And while you can’t predict the future, you can prepare for it by considering some of the decisions nearly every entrepreneur needs to make at some point.
Here are five of the most important decisions you’ll face in your entrepreneurial life.
#1 Your Target Market (Ideal Customer)
Many companies start out thinking their products are useful for a lot of people. And who wouldn’t? We all want our businesses to grow and make lots of money.
But in the beginning, you need to account for people’s resistance to change, which means you need to target those who stand to benefit the most from what you’re offering.
For example, say you’ve launched a company selling a new phone case that makes it easier for people to listen to music while working out (this is likely a saturated market, but it works for the purpose of the example.). Your long-term plan for the business has you targeting people from ages 20 to 45, but in the beginning, this is too broad.
So, how could you ever efficiently target such a large audience? You couldn’t, or at least not in a way that a small business could afford.
A better starting point might be to go after single males in their 20s who work from home and spend a lot of time at the gym. They are most likely to want your phone case because it’s sleek, it protects the phone from drops and water, and it easily clips to their belts.
Succeeding in getting this demographic to become users will give you a base upon which you can build, providing your company with more stability and a better chance of succeeding.
#2 Core Values and Company Culture
This is not something most entrepreneurs think about in the beginning stages of running their business. After all, it’s hard to form much of a culture when there are just five employees working out of a rented office space.
But you really should be making decisions about this stuff right from the beginning.
A good starting point is to outline your company’s core values. These are the pillars of your business, and they will help guide you as you move forward.
When faced with a difficult decision, all you’ll need to ask is, “Is this in line with our core values?” If the answer is yes, then do it. If not, then don’t do it. It’s that simple.
Furthermore, defining core values will allow you to get a jump start on building a strong company culture, which will make it much easier to build an engaged workforce that is productive and committed to your company mission.
Core values give you a roadmap for the organization before it gets too big and culture becomes difficult to manage. Knowing who you are and who you want to be will make it easier to identify good job candidates, and it will also make it easier for your business to develop good processes that are in support of your overall business objectives.
#3 Brand Identity
Branding is going to be key for your business. As you make headway into the market, you need something for your customers to latch onto, otherwise, they’ll forget about you and turn to the next company to break onto the scene. A strong brand is the way to do this.
In essence, your brand is the combination of associations people make about your company. And when people relate to these associations, they’re more likely to be a loyal customer.
Think about Nike, one of the strongest brands out there. We hear the name and we think “hard work, perseverance, fearlessness, etc.” Those who see those qualities in themselves are more likely to buy from Nike, as they feel an affinity with that brand and want people to know it.
As a new company, you don’t stand a chance competing with brands like Nike. But you shouldn’t be trying to.
Instead, you should be working to forge a unique identity that people can relate to so that when you begin recruiting customers you can also begin forging affinity.
This starts by defining your own identity. What do you want people to feel about your company? And how are you going to portray that?
Decide these things early so that you can begin forming the right associations in people’s minds from the moment they first connect with your company.
#4 Outsourcing and Automation
Since you’ll have fewer of them and they are bound to be less loyal in the beginning, your number one goal needs to be pleasing your customers.
However, there are lots of other things that need to be done to run a business. But it’s important you learn early which ones deserve more of your attention and which ones can be left to someone else.
As a result, determine what your core activities are, and then automate or outsource the rest.
Not every business can outsource and automate the same things. It’s your job, in the beginning, to decide what these core functions are that make your business a success.
If you’re in need of a stellar sales team, then it might make sense to keep HR in-house so that you can have better control over the recruiting process. Or if you’re a tech company, maybe you want to handle cybersecurity on your own instead of turning it over to someone else.
No matter what it is, there are things you need to do and things that can be done by others. Figure out which is which right from the beginning and your business will be more successful because of it.
#5 Exit Strategy
It’s hard to imagine exiting your business when you’re still getting it started, but this is something you need to think about because it will help inform your decisions moving forward.
Most small businesses will sell out in a merger or an acquisition. Initial public offerings (IPOs) are more lucrative, but much rarer. It’s best to be realistic and to plan accordingly. And by deciding early how you plan to exit the business, you can steer the company in one direction or another.
For example, to return to the phone case example, you could see the company resolving a market inefficiency and then being absorbed by a larger entity.
In this scenario, you may not be too worried about expanding your reach, as this will happen naturally when you’re acquired.
Instead, the strategy would be to fully exploit your market segment and then reap the benefits of a profitable sale. If you were going for an IPO, though, you’d likely be more ambitious, as you would need to prove to investors you can grow beyond your current state.
You can adjust along the way, but always have a plan in mind.
Plan Then Act
There are a lot of things you need to decide as an entrepreneur. But these five are perhaps the most important. Spending time now to think through how you’ll approach these five different problems will make it much easier for you to make other decisions about the business, allowing you to push forward with a plan and to grow a business that can stand the test of time.