The 6 harder truths about start-ups
These are my own 6 hard truths about setting up a business, which are in response to Daniel Priestley's 6 truths, which I found were not nearly hard enough for my liking:
You will lose lots of money and you will almost certainly fail. The fact is, you need a huge amount of cash reserves to start a business as you will burn through it so quick it will make your eyes water. It is only at this point will a very select number of people go on to make it a success and where almost everyone else fails.
There is no such thing as meritocracy in business. Working very hard and having a great idea are far less important than you may think. Instead, setting up a successful business will often come down to the amount of money you had prior to setting it up and the quality of your contacts. More often than not, having relevant industry experience will always override your mere willingness to work hard.
Start-ups are generally synonymous with middle-aged men. If we want to live in a country where people of all backgrounds and abilities have a chance of succeeding, then we should not be looking for start-ups to lead the way. The reason middle-aged men are the ones most often involved in starting a business, is because of point number 2 – they generally have more money and more experience in business than anyone else.
Not everyone can or should set up a business. While this is the natural progression of the point above, it is still worth making clear; those who are disabled, poor or suffer from discrimination should not be setting up businesses. Start-ups are monumentally precarious and the people with the best chance of success are those who hold most sway in this world: that is middle-aged men.
The experience of setting up a business is of little value. You may reason that setting up a business is such a unique experience that even if you do fail you’ll be held in such high esteems by everyone else that getting another job will be a doddle. The truth is that when starting a business you become a “jack of all trades” and learn to apply yourself to most things. However, you fail to specialise in anything which means you are ultimately worthless to most other businesses. The jobs market is full of specialists, there is little demand for a general entrepreneur.
Nobody tells you to quit. You may think this is a good thing, but it really isn’t. If you’ve ever seen Dragons Den when they tell a person pitching their business that they should quit, this is in fact probably the nicest thing they could say. Because in reality everyone around you will tell you to keep going and it becomes extremely difficult to know when to stop. My partner and I were never told to quit, but I wish someone had as it would have saved us £30,000 and 4 years of our lives if they did.