Some entrepreneurs come up with the perfect idea at the right time at the right price and execute the right go-to-market plan while the stars are aligned, make truck loads of money, sell their companies for millions (or billions) and jet off into the sunset for one of Puffy’s or Sir Richard Branson’s parties.
The rest of us don’t have it that easy.
To be a success you have to be very smart about how you manage your money, time, business and energy. The stamina it takes to build a successful business is rarely discussed but it is very real. Day in and day out, you are working to grow the business. You wake up thinking about your next move, during the day you execute that next move, in the evening you’re thinking about the move after that. Over time, this has a definite impact on your mind, body and family.
With the extra pressures of the sludge economy we’re currently working through, and with capital being a bit more difficult to come by, you should consider collaborating with other entrepreneurs to take your idea or existing business to the next level. As entrepreneurs, we are always eager to prove ourselves and show off our business chops, so initially the idea of collaboration may be a turn off. You may think that anyone interested in the same business as you is a competitor. You may also feel that collaborating is an admission of entrepreneurial weakness. I understand where you are coming from; but I encourage you to embrace new perspectives.
Without shame, Fortune 500 companies use collaboration to their benefit. In fact, large companies would select collaboration over innovation any day because their number one goal is to reduce risk and make more money. That’s why large companies buy smaller companies that have come up with something new and proven. Even if it sounds good, big companies want no part of it until it is a proven product or service. That’s also why they team up with other Fortune 500 companies to produce events, create new products and conduct research—because it spreads the risk around and increases the chances for success when you have multiple people with various skill sets working on a problem or opportunity.
Use this strategy to your advantage. Instead of a publicist, accountant, attorney and chef starting four separate businesses—such as a PR firm, accounting firm, law office and restaurant—those same four professionals could join forces and start one company. For example, if they launched a catering business, the publicist could work on marketing, PR and sales; the accountant could manage the businesses’ finances; the attorney could handle contracts and other legal matters; and the chef could prepare the food. When problems arise, there would be four smart people to figure out a solution rather than one person jumping through hoops alone.
And there would be four times the resources and networks to tap into to grow and position the business for long term success. Sure, they might each only own 25 percent of the company but 25 percent of a million dollars is much better than 100 percent of $50,000. Nationally, businesses that have multiple people working in them earn seven times more revenue than businesses operated by solo entrepreneurs.
I know it feels good to the ego to say, “I did all of this myself,” but you may find in these tough times that you’ll have a better quality of life, solve problems faster and make more money if you engage in cooperative economics by collaborating with other entrepreneurs.
Felicia Joy is a nationally recognized entrepreneur who created $50 million in value for the various organizations and companies she served in corporate America before launching her business enterprise. She is the author of Hybrid Entrepreneurship: How the Middle Class Can Beat the Slow Economy, Earn Extra Income and Reclaim the American Dream and a regular contributor on CNN. Follow her @feliciajoy.