Being an entrepreneur isn’t for everyone.
It often takes years of hard work, long hours, and no recognition to become successful. A lot of entrepreneurs give up, or fail for other reasons, like running out of money.
Statistics show that over 50% of all businesses fail after five years in the United States.
40% of startup failures are due to a bad fit, followed closely at 38% from lack of time and involvement.
I’ve been open about my past failures as an entrepreneur before.
Running your own business and being in control of how you spend your time is amazing. I couldn’t imagine doing anything else.
But it’s also really hard.
You’re not going to succeed all the time.
You may fail three times in a row. But that fourth time could be your shining success.
My first company failed miserably, and my second failed and left me over $1 million in debt at age 21.
If I had given up then, I’d still be paying that back.
But I kept on creating products and solving problems.
To me, there was no other option. I couldn’t imagine doing anything else with my life.
If multiple failures without any guarantee of success scares you, it’s probably a sign you’re not cut out to be an entrepreneur.
Here are 7 other indications it’s time to call it quits on starting your own business.
You like to stay in your comfort zone
As an entrepreneur, no two days are the same.
One day you could be by yourself all day writing, designing, or coding your product.
The next day you could be fielding sales calls, interviewing personnel, or being a guest on a podcast.
If you’re an introvert like me, the first day seems a bit more appealing.
But you need to put yourself out there and be okay with being uncomfortable.
Let me ask you this: When was the last time you did something that scared you?
It may sound cheesy. But if you can’t remember the last time you took a risk, then maybe being an entrepreneur isn’t for you.
Vera Wang took a big risk starting her fashion business.
It was definitely out of her comfort zone.
The former figure skater didn’t qualify for the 1968 U.S. Olympic team. She knew she had to reinvent herself and pivot her career to something else.
She was already working at Ralph Lauren, but it wasn’t until 1989 that she discovered her true passion.
She was preparing for her wedding and didn’t like any of the dresses she looked at. She thought there should be more modern and fashion-forward options.
So she made her own.
She sketched it and hired a seamstress to make it for her for $10,000.
That was a big risk but it paid off. Now, Vera Wang is known worldwide for her innovative bridal style.
None of that would have been possible had she never taken a chance on making her first dress.
You think it’s a path to quick money
I can’t imagine a slower way to make money than being an entrepreneur.
You could work for years without ever seeing a dime.
This is exactly what happened to me with my first three businesses: Advice Monkey (failure), a web hosting company (failure), and Crazy Egg (eventual success).
The infographic below depicts a typical path to success for a startup.
What it doesn’t show is that this process happens over months or years.
The time it takes to make a profit from your startup is all-consuming.
You work more than an eight-hour day, leaving little time for other income-generating opportunities, like another job.
Plenty of successful entrepreneurs have been able to work on their businesses while still holding down a full-time job, like Jason Quey.
He started a clothing business at 22 years old and made over $200,000 in the first year while still having a regular full-time job.
That’s pretty impressive.
But it’s not the norm.
While it’s possible to start a blog or business that generates money fairly quickly, most do not generate anything for a year or more.
You need to be starting your business with the mindset that you’ll still be working on it five years from now.
As Jeff Haden says, “As a business owner, you earn the right today to stay in business tomorrow.”
Nothing is guaranteed in the future. You can’t treat your business like a get-rich-quick scheme. It just won’t work.
You’re a procrastinator
If you can’t manage your time effectively, you’re bound to fail as an entrepreneur.
When you work for yourself, there’s no boss looking over your shoulder or monitoring your time card to make sure you’re working hard.
If you’re not working hard at your own business, why are you even doing it?
If you’re working hard but feeling like you’re not getting anywhere, you need to take a step back and prioritize your tasks.
Your tasks can only fall into one of four categories.
Urgent and important
These are things that just can’t wait.
Whether it’s a quote for a new client, returning a voicemail, or hitting a publication deadline for your blog, you need to make sure it happens.
Important but not urgent
This is a task that is important but the world won’t end if you don’t do it right now.
That could be returning some routine emails or updating your social media accounts.
Urgent and not important
An urgent task that’s not important could be something like renewing your business license or ordering new supplies for the office.
You can easily delegate these tasks to someone else.
Not urgent and not important
Don’t even waste your time with these tasks! Get rid of them.
An example of a task like this could be exploring a new business idea. It doesn’t mean it’s a bad thing to do, but it won’t help your current business.
Leave it on the back burner until you have the proper time to devote to it.
Research has proven that multitasking isn’t effective.
People’s lack of focus costs the global economy an estimated $450 billion annually!
On average, people spend only just over a minute on a task before getting distracted.
Even more surprisingly, it can take more than 25 minutes for them to get back on track with their work after a distraction.
The statistics about the effects of multitasking on the brain are even worse.
Multitasking can lower your IQ by 15 points!
That’s a temporary effect, but still shocking.
People who multitask also take an average of 50% longer to complete a task, and make 50% more errors than people who focus on only one task at a time.
If that’s not enough to scare you into giving your work your full attention, I don’t know what will.
You don’t know how to create a marketing strategy
This is a tough one.
Learning marketing takes a long time.
When I started Advice Monkey, I hired a marketing agency to grow the business. I spent all my money on hiring them, but they failed to get any results.
I had no choice other than to learn marketing myself.
That business ended up failing anyway, but the lessons I learned have allowed me to become who I am today.
When you’re starting out, you need to wear all the hats.
You’re the CEO, the chief financial officer, the customer service agent, the janitor, and the marketing department all rolled into one.
Sounds fun, right?
You can have a truly amazing product but without the right marketing, no one will ever know about it.
You need to spend time investing in learning how to market your business.
I’ve written about marketing in detail, but here are the main things you need to include in your strategy.
A customer persona
How will you know what product to build or how to sell it if you don’t know who you’re selling to?
Think about your ideal customer. This is the person you’re creating this product or service for.
Write down everything you know about them.
Your customer persona should include their age, salary range, what kind of job they have, what their pain points are, and how your product helps them.
Your value proposition
This is the reason your customers buy your product or service.
It’s what makes you unique, innovative, and worth the money they’re spending.
A good value proposition includes the key benefit of your product in a way that isn’t pushy.
A good example is Uber. They focus on being the “easiest way around.”
Uber explains how it works in one sentence: “One tap and a car comes directly to you.”
They never say that taxis or public transit is horrible. They just focus on explaining the service clearly and how it seamlessly fits in with your day.
Personally, I’m a big fan of Uber. I use it to get around whenever I’m traveling instead of renting my own car.
Your marketing and sales goals
You may not know exactly how to market your product right now, but do you know where you’re headed?
Having clear goals for your marketing strategy is very important for the long-term success of your company.
Writing down your goals makes you 50% more likely to reach them.
If you’re creating a new software product, your goal is probably to get as many users as you can.
You need to get specific with your goals.
How many users do you want this quarter? Next quarter? By the end of the year?
Break it all down and track your progress regularly.
You can’t think of any problems to solve
Think about your daily life.
Can you think of one new product idea that would make your life easier or more efficient?
Maybe your idea is an automated dispenser for those thin produce bags at the grocery store that take forever to wiggle open between your fingers.
Or, you could invent a new way to find what you’re looking for in grocery store aisles, like a store app that includes a map of all the aisles instead of having to walk down each one.
Can you tell I don’t like grocery shopping very much?
But in all seriousness, if you can’t think of even one small thing to improve your life, how are you going to improve the lives of others?
Being an entrepreneur means coming up with creative solutions to problems and putting something new out into the world.
Your idea could come from years of experience or out of the blue one day.
But you need to have an idea.
Most startup founders came up with their ideas by working in their industries for a while and seeing problems firsthand.
A close second, at 19%, are founders who invented something they wanted to see in the world.
In third place, at 11%, are founders whose ideas are copies of other businesses but do something different or better than they do.
Whatever category your business falls into, you need to figure out how to attract customers. That means finding out what problem people have and solving it.
If you can’t do that, you’re not an entrepreneur.
You make a lot of plans but don’t take action
A lot of people think making a business plan means they’re starting a business.
This is so wrong.
I could plan out my meals for the week, but unless I actually cook them, will I be eating them? Nope!
Planning means nothing without action.
Many people are afraid of failing if they start a business. A recent study in the European Union found that almost 40% of people considering entrepreneurship are scared of failing.
Financial considerations are definitely understandable. A lot of entrepreneurs go broke before they ever become successful, which was true for me.
Surprisingly, a “fear of losing personal freedom” also made the list of people’s top entrepreneurship fears.
I hate to break it to you but the life of an entrepreneur isn’t a forgiving one.
In the early stages of building your business, you’re especially pressed for time. You won’t be able to spend as much time with family and friends as you’d like.
You might feel like everything you’re doing is for your business because it probably is.
Being an entrepreneur isn’t for the faint of heart, and it’s definitely not for people who are afraid to fail.
You can make the necessary plans to start your business while still taking daily action to get there.
Maybe you need to raise funds for a physical store location.
While you’re doing that, you can still apply for business licenses, research what products you’ll carry, and set up relationships with suppliers.
There are always tasks you can do to push your business forward.
If all you’re doing is making a to-do list instead, those items will never get done.
You get along with everyone
Being an entrepreneur doesn’t make you Mr. Popular.
From having to hire and fire staff to working with business partners, you need to know when to fight for your ideas when others disagree.
A scientific study even found that antisocial teenagers were more likely to become entrepreneurs.
Another study of entrepreneurs who have started more than one business found they have much stronger persuasive abilities than the average person.
Part of being persuasive is convincing other people you’re right when they think you’re wrong.
If you’re the type of person who can’t stand confrontation, being an entrepreneur isn’t for you.
I’m not saying you need to be able to yell at people or use intimidation to get your way. Those are childish tactics that effective leaders don’t use.
You can’t be so concerned about if your employees like you or not that you’re unwilling to deliver tough feedback or do the hard jobs, like having to let someone go.
82% of people don’t trust business leaders to tell them the truth.
That’s crazy!
A good leader will always tell their employees the truth even if it isn’t good news.
It’s your job to captain the ship and ensure your employees feel like they have lifeboats if trouble arises in the company.
Get comfortable with making tough decisions and acting quickly.
Not everyone will like you, but people respect leaders who tell the truth.
Conclusion
Entrepreneurship isn’t for everyone.
The blood, sweat, and tears that go into starting and growing your own business are enough to scare most people away.
You need to make friends with failure and learn how to live outside your comfort zone.
You also need to take action on your ideas and be very efficient at managing your time.
Starting a business can be lonely at first. You might have a co-founder, but it will still feel like the two of you against the world.
That’s how it felt when I started KISSmetrics with Hiten Shah. We were building this great tool together that ultimately became very successful, but at first was really challenging.
Hiten and I both shared the same work ethic. We worked 16-hour days, or more sometimes, to get everything done.
If you’re lucky to have a partner who has the same dedication as you, it can help make the startup journey easier.
If you’re going it alone, it’s hard to remain positive and push through roadblocks.
Even if you do persevere, you will still fail at some point.
It’s inevitable for entrepreneurs.
You have to pick yourself back up, learn from the failure, and keep going.
Not everyone can do that.
If they could, everyone would be an entrepreneur.
Are you an entrepreneur already? What is the best advice you’d give your younger self when just starting out?