What Kind of Business Should You Start?
Ask yourself these key questions to figure out the right business for you.
I am not going to lie to you. Starting any business takes a lot of time, effort, money and commitment. When you are working hard and dedicating time and effort to starting a company, you want to make sure it is the right kind of business for you.
Some people's personalities make them a great candidate for the education industry, a quick-service restaurant or nail salon. But with so many options, it can be tough to know what kind of business to pursue with your hard-earned money and valuable time.
I know a little bit about this. My current business, Code Wiz, is my eleventh business! I tried many different models and industries before I found the right fit for my personality, strengths and interests.
I would love it if you didn't have to start ten businesses before finding your right fit. Here are six questions to ask yourself before you pick the right business for you.
What are you passionate about?
I have always been passionate about making an impact on the next generation. It gets me excited and motivates me. Teaching kids how to code and unleash their creativity is incredibly rewarding and is a great fit for me.
What are you passionate about? What's the thing that you are always thinking about? What makes you happy? Let's say you love doing puzzles. I am not saying you should start a puzzle company, but a job that involves problem solving could be a perfect match for you.
Similarly, if you don't love talking to people, then starting a consulting company would not be a good fit for you. Assess what excites you and what doesn't.
What are the current business models and industry trends?
I'm not saying that you should start a business just because it is trendy. But paying attention to the popularity of an industry is a great way to see if your business would be feasible.
For example, I would not recommend that you start a DVD rental shop in 2021. Make sure that the business you're investing in will still exist, and be needed, in ten years.
Assess your skills and abilities
Self-awareness is a real superpower. Knowing what you're good at and what you're not can make all the difference in your success. Are you detail-oriented, or do details make you break out in hives?
I have always been mediocre when it comes to spreadsheets; if I started a bookkeeping business, it would be disastrous. But I love being silly and coming up with creative marketing ideas, so working with kids and taking on the marketing for my business was an ideal fit for me.
How much money do you have to invest, and how much are you willing to invest?
Let's say you have $100,000 to invest, and no more. A Mcdonald's restaurant would not be a good fit for you because it requires a lot of money. It's important to know what businesses are practical options for you. In Africa, they would say, "You need to cut your cloth according to your size."
Beyond how much money you have to invest in your business, another great angle to consider is how much income you personally need.
If you are trying to replace a seven-figure income, a single-unit business in the education industry won't be a good fit, but investing as a multi-unit franchisee across a variety of brands could be. Whereas if you are just looking for enough money to travel full time in Bali, you may not need a business that generates as much money.
How involved do you want to be in the business?
Do you want to just hire a manager and walk away? Or do you love the idea of actively being a part of your business?
Some business models (like my company's) require more active ownership because they involve getting to know clients on a personal level, but some B2B businesses or highly systemized personal-service type brands could be a better fit if you are looking to hire a full-time manager and be a more absent owner.
I personally believe that businesses (especially new ones) benefit from having the owner take a more active, full-time role. I have seen the most success come from the businesses that have an involved owner for the first several years.
What is your biggest ROI?
What do you view as the biggest return on your investment in your business? Time with family? Flexibility with your work schedule? Leaving a legacy?
Money has never been my biggest motivator. Instead, I have always seen my ROI as the ability to spend time with my family, being my own boss and leaving a legacy for my kids. I want my daughter to see thousands of Code Wiz locations teaching kids to code and be able to say, "Yeah, my mom built that!"
After reviewing these questions, I hope you find some clarity on your values, priorities and motivation to better narrow down the right business for you. Owning a business is incredibly rewarding, and it is the most rewarding to own a business that is a great fit for your personality and skill set.
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