I decided to write about the subject after a long reflection on my own mistakes and hits belong the last four years of entrepreneurship.I planned, risked and followed myself several roads, in the search of making real my dream of lifting an enterprise from the only goods that I was arranging in the time: a trolley of popcorn and some ideas about it.
When you're starting a business for the first-time, the most common obstacles are the lack of capital to leverage growth and the inability to manage resources. Then I think its necessary to improve the know how about the focused idea and learn how to invest properly. Usually the initial capital is not sufficient to support the path errors, due to its recovery. Consultancies help, but still the mistakes are frequent due to inexperience. Making mistakes is part of the game and is one of the main tools for learning. The problem is which mistakes in the initial phase of a business very often it means the death (temporary or definitive) of the project.
There were times when I thought of throwing in the towel too, but unyielding desire to transform my dream into reality gave me strength to continue.
I noticed that one of the most common mistakes in investing capital has to do with the inherent optimism of the entrepreneur. He believes wholeheartedly that he will get the results and invest based on their expected rather than on their needs. I´m not saying it´s wrong, but dangerous when capital is scarce.
For example, a factoring of meshes that is receiving many requests, resolves to do a financing for the purchase of several machines and to increase his hall. So, the partners think, they will be able to go to the search of more clients and to grow 5 times in one year. But the clients do not appear in the expected quantity, or a competing fort enters in play. The difficulties appear in paying the debts that were calculated on basis of the expectation optimist, and to honor them the working capital is used. Without working capital, the suppliers' payment is compromised, or the most ironic - same thing that appears a great request, there will not be how to accept it since for so much it would be necessary to do a great purchase of materials to the sight with receiving for the service, for example, in up to 60 days.
Investing according to need means working within the capacity of the materials and labor available, and then take the next step. The growth is based on the company's current reality and the expectation serves as motivation to go forward regardless of any obstacles.
Objectively analyze the market, the investment plan and goals, enabling them to a professional management without losing the entrepreneurial spirit is the current focus of my personal improvement to eliminate the mistakes made previously.
So if you are thinking of investing high – is it to provide a market demand or to provide your expectations?