Business is filled with risk, and that can either give you a tremendous reward or crushing loss. Many entrepreneurs are ready to invest their entire lives’ savings into getting a company off the ground, but this can backfire when they choose the wrong industry or the wrong time. How exactly do you know when the best time to launch a startup is?
There are a few ways you can gauge. Keep both the practical and logistic factors in mind as you develop your business model to determine when you should go full steam ahead with your idea.
When You Know What You Stand to Lose
An all-or-nothing mentality might seem like a key ingredient in the recipe for a killer startup success story, but this isn’t the case for the majority of people. People who are willing to gamble everything stands to lose it and this loss often happens much faster than they realize.
Imagine you quit your steady job and invest all your savings into getting a company off the ground, only to find yourself in crippling debt with an unsustainable revenue stream a year later.
You can close the business, but you may still owe money on loans, to employees/contractors and even to investors. It’s beneficial to work with a professional accountant who can help you get concrete figures regarding your company.
Not only can they help project how much you really need to succeed, but they can also forecast what you stand to lose and provide preventative strategies.
When You Have a Backup Plan
There will always be excuses not to pursue your startup, but there are also plenty of reasons why it’s better to wait than act out of impulsivity. It could be months or even years before your company is profitable to sustain you full-time; how do you plan to pay your bills and move progressively toward the future in the interim?
You should also consider what type of job you’ll work if things don’t fare the way you want. This could be staying at your current job or transitioning into a new field.
When You Aren’t Blinded by Money
If you’re only launching a brand to get yourself out of debt or strike it rich, you should reevaluate your current money management skills. No one goes into entrepreneurship because they don’t want to make money, but you can’t let the off-chance of generating a large sum of money blind you to the real losses, risks, and investments that are required of you now. Ask yourself how you handle a budget now. Can you properly operate a business if it does take off?
How would you turn a moderate earning into even more? Do you have debt under control? If not, look into solutions like credit card consolidation, loan forgiveness, and refinancing student loans with a private lender to reduce your monthly expenses.
When You Know Your Market
The economy is always changing, and that goes even more so for specific industries. If you only gauge your launch time of the nation’s economy, you could miss out on a ripe opportunity to fill a demand.
You could alternatively do too limited research and not recognize the impact of outside circumstances on your target audience’s ability to patronize your business.
If you’re launching a B2B company, consider the prospective growth of the field, how it’s delivery and market may change, and how you can get ahead of the curve. Considering the big and small pictures are how you decide the best time for your startup to take off.