Setting up a Small Business

On January 1st 2020, I began to set up my business, BIM Guru. As a first time small business owner, there were a lot of important lessons I learnt along the way (some which I was prepared for, some not). I decided to share some of my experiences and tips to others looking to make the leap!


Overview


Please note that all opinions and experiences in this article are my own; do your research if you are setting up a small business as well. For those with little time to read this article, the key things I needed to set up my small business were as follows:


- Planning

- Money

- Protection

- Time

- Conviction


I'll break down each of these aspects and how they related to my setup process, as well as considerations I think any small business owner should consider in relation to these.



1. Planning - Know before you go

So you've decided to set up a business, congrats - the easiest step is done! The first thing you should do from here is form a robust business plan. If you don't want to write it out straight away that's OK (I did); at the very least form it in your mind! Even if you have clients beckoning you towards kicking off, doing so without a plan is a sure recipe for failure.


I found a lot of great resources available out there for helping to form my business plan, in particular from www.business.gov.au (which provides a free template and guide). Take the time to engage with such resources to make sure you fully plan your business - set aside a period of time where you specifically do not deal with clients (I am taking 2 months).


Spend some time creating, establishing and registering a brand which you and your clients will believe in. For me, the choice was clear to me before I began - I wanted to connect my educational identity (Aussie BIM Guru) to my business via derivation of it's name. Take some time to develop a logo (even if a prototype), as this will influence your branding, marketing and document templates. Make sure your website domain and business name are available and that there aren't too many similar ones in your marketplace. One hit I took was accepting that my '.com' domain was not available, but my '.com.au' domain was (the '.com' domain's owner appeared to be inactive). If you are selling branded products, highly consider trademarking your business name early on.



2. Money - Financing your operations

I think that the biggest trap for anyone setting up a business is to not do so with significant capital riding behind it. Yes, you can take out loans to finance a business, however this can be a major risk should your venture not pan out how you expected.


I was speaking to another small business owner the other day, and we agreed that you should set yourself up with enough financial backing to launch and maintain operations for at least 1 year - nearly every service locks you into 1+ year subscription windows these days anyway!


Don't forget that you still need to finance your personal life; it can be all too easy to get tunnel vision and sideline other financial factors like rent, food and non-essentials. I suggest keeping a business related forecast as well as a business/personal hybrid one so you can keep track of your break-evens and goals between these two sides of your life. If you operate as a sole trader, this is particularly important.



3. Protection - Don your armour

One of the most common things I see missing from other small businesses is this; insurance, accounting and legal support. I can understand why people take this risk - it is expensive! The consequences of flying without a safety net threaten to be far more expensive however.


I suggest shopping around when it comes to insurance; the good old rule of at least 3 competitive quotes (from sources well aware they are in competition) does wonders. As well as this, read your policies with a fine-tooth comb before entering into them. Do your research; find out how much and what you need to be covered for. If you work with cloud based services, don't forget your Cyber Liability insurance (PI is not enough anymore). Having worked for many large scale corporate firms, I understand the value of having a lawyer on your side. If you're putting together contracts to work with your clients, it is crucial to have a lawyer review your baseline contract. As well as this, shop around for lawyers also; the best lawyer for your business is one who understands your services and the risks/complexities involved in their provision. Prices will vary wildly!



4. Time - Don't build Rome in a day

Planning and money tie directly to one of the things you'll need most - patience! Some things took quite a lot of time to get moving for my business, in particular finding and choosing insurance and a lawyer. A major component of your planning process should be scheduling how long each 'phase' of your setup process is meant to take; I broke mine into manageable weekly chunks.


Of the 2 months I've spent setting up my business actively, my time has been roughly utilised at 75% I'd say. I know that once my business is moving, time is something I wont have a lot of anymore; so it's nice to take a bit of it off before this happens. See this period as an experiment in time management; a skill which you will need to master in your professional work.


Use your downtime productively - establish a good sleeping routine, remain active in your professional networks, rediscover your exercise regimen and go out of your way to see others (maybe they could become potential clients).

5. Conviction - Believe in what you do

Not everyone you meet will support your business. I can personally attest that friends will scoff, competition will try to scare you away and unsuccessful business owners will displace their bitterness onto you. Ignore them - believe in your business and you will ultimately succeed.


When I look at the most successful business owners in today's day and age, the one thing they all have in common is their unwavering conviction. Everyone's a critic, but not many people are a success! In addition to self-belief, surround yourself with those who believe in you as well. No man is an army, so a bit of emotional reinforcement goes a long way in the times where your conviction might falter. I can attest that my partner has been an absolute rock for me in this phase of my life - both a sounding board for my ideas and a top fan cheering me on from the sidelines. If you have a partner, talk through your business plans with them; they will likely need to sacrifice a lot of their time with you for it to succeed - it's a balancing act.



Conclusion

I hope these factors and my insights/experiences help others in deciding whether they want to make a similar leap (or how they can adjust their trajectory if they already have).


There are many additional challenging factors yet to come for me and my business, and I look forward to facing them!


See you all soon in the market.


- Gavin Crump @BIM Guru

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