WHAT'S IN THIS CHAPTER
-What are the elements of a successful business? In this chapter we profile four successful, inspiring businesses, learning what drove them to start up, the challenges they faced along the way and the key lessons they learnt.
Still a good time to start up...
If you have picked up this guide and are reading this page, the chances are that you are thinking about starting your own business. And, despite whichever direction the prevailing economic wind is blowing in, you are not alone. Until the recession in 2008, more and more people were feeling the entrepreneurial urge. More than 200,000 new businesses registered for VAT (value-added tax) in 2007, according to the latest government statistics in November 2008 - a rise of 23,700 over 2006.
Although the 2008 figures won't be available until late 2009, indications are that there will be only a small decline in VAT registrations, despite de-registrations - those companies going out of business - expected to increase significantly, according to the Department of Business, Enterprise and Regulatory Reform. This is because many people who have lost their job are starting up on their own.
Despite the downturn, small- and medium-sized businesses remain a key driver of the UK economy. The days of hundreds of large companies employing thousands of staff are no more. The number of aspiring entrepreneurs starting small businesses has surged in recent years, and their companies now make up 99.9% of the total businesses in the UK, and are responsible for almost half of the UK's workforce.
Starting a business in a recession - pros and cons
Reasons not to start in a recession
1. People are spending less money
2. It will be harder to raise money
3. It feels risky at a time when everyone is scared of risk
Despite the downturn, small- and medium-sized businesses remain a key driver of the economy
Reasons not to start in a recession
1. It is cheaper to start now than at any other time
2. So it needs less cash to start than at any other time
3. Your opportunity cost is small
4. People and businesses still consider some new options
5. Creative non-cash deals easier to do e.g. partnerships
6. Easier to hire great staff/consultants
7. Your positive energy amid a sea of depression will stand out
8. Cheap acquisitions
Technology has advanced to such a stage, it's now possible to start a global business from a laptop, forcing the entrepreneurial doors wide open to everyone from teenagers to the retired and those who quite sensibly want to dip their toes in the water (or at least on eBay) before taking the plunge. There's also a greater range of finance available to help make your entrepreneurial dreams a reality than ever before. Even though some of the key sources of finance, such as banks and equity investors (which take a stake in your company in exchange for finance) have been badly hit by the credit crunch, and are investing less in new businesses, money is still available. So if your idea is good enough - and presented in the right way - people will want to invest in you. (For a detailed discussion of finance options, see Chapter 4). What's more, if you can gain investment in tougher economic times, it's tantamount to a rubber stamp of success.
There has also never been so much help and information for people who are thinking about striking out on their own, and the government has never been so geared to encourage enterprise. The National Enterprise Academy, which will open its doors in September 2009, will deliver the UK's first full-time accredited courses in Enterprise and Entrepreneurship. It is the brainchild of Dragon's Den entrepreneur Peter Jones and its aim is to give students - aged from 16 to 18 - the skills, experience and support to learn how to set up and run successful and innovative businesses, or to become enterprising employees, helping to grow existing businesses - skills that can be used across any business sector, and skills for life.
--This text refers to an out of print or unavailable edition of this title.