I have been practicing law for over 25 years and the attitude I have seen that most disturbs me is that running your business is a chore that the business owner should not have to do. I have seen this attitude gaining ground over the last few years among a group of young entrepreneurs calling themselves ‘digital nomads’.
This is one of the
biggest mistakes you can make!
When you start a
business you are going to have to do a lot of things that may have
nothing to do with what you consider is your business. You are going
to need to keep a good set of books so that you know how much money
you are making, what are your costs, who owes you money, who do you
owe money to, how much do you have to pay in taxes, etc. You should
sit down and understand what is the best type of business entity for
you to use to operate your business. You should try to understand the
risks you are going to face. Can someone sue you? For what? Who might
that be? Will it be your clients, yours suppliers, your partners,
your family, total strangers? Will you have to sue them? What type of
contracts are you going to need? How can you manage all that risk so
that you do not lose everything you are working for?
If these are
questions you do not want to think about, I advise you to do one of
1. Do not start a
business and instead go to work for someone who is willing to do all
that stuff, or
2. Find a partner
who will handle all that dreary ‘non-sense’ for you. (And if you
choose to pursue this option be prepared to have your partner remove
you at some point from the business since you will most likely be
You see all that
annoying stuff is your job as a business owner. It is what you are
supposed to do. If you do not do it who will?
Take for example a
plumber. You may think that the job of a plumber is to fix people’s
plumbing. Hopefully the plumber knows better. If he is working for
himself, that is if he is operating a business, his job is to do all
that annoying stuff to make sure he does not get into trouble while
fixing people’s plumbing, and so that he can make the most money he
If all he does is
fixes people’s plumbing, no matter how good a plumber he may be, it
is just a matter of time before he goes out of business. The real
money to be made in operating a plumbing business is not in doing the
plumbing. The real money is in managing the business. That is why
successful business people make more money than employees!
If you do not want
to manage your business, then go work for someone else who does. Do
not begrudge them the profit they make managing the business. You do
not deserve the money that is made by the business person who is
doing all the crap that you do not want to do. Not only do you not
deserve the profits from the business, you might very well be happier
not having to deal with the problems that come with owning and
operating a business.
Let us go back to
our plumber. Obviously he became a plumber because he liked that
trade, and he thought he would make money doing it. But the truth of
the matter is that the hardest part of operating a plumbing business
is not the plumbing work… it is everything else. If he is running
everything else and does not have the time to do all the plumbing
work he can hire another plumber to help him out from time to time.
In fact as the business grows he may end up doing no plumbing at all
and hiring plumbers to do the work as employees. Who is going to make
the most money? The plumbers he hires or him – the guy who owns and
operates the business? If he is doing a good job operating his
business it is going to be him.
So when I talk to
potential clients who resist doing simple things like setting up a
proper accounting system, I am forced to ask them, “Why are you
going into business?”
To make money?
Obviously not. If you do not want to operate your business with a
basic accounting system you have no interest in money. That is what
accounting is all about; managing the money of the business. If you
do not want to do that, then go work for someone else. I suspect you
will make more money working for a competent business owner than
trying to operate your own business.
The same thing goes
for setting up the proper business entity, preparing the proper
contracts between you and your partners, clients, suppliers, etc. If
this is all too much of a bother for you then being in business is
too much of a bother for you. That is what operating a business is
I know there are
some people who for one reason or another cannot work for other
people, and cannot do all the tedious work of operating a business.
What should such people do? I advise them to look hard in the mirror
and accept the two problems they have:
1. You cannot work
for other people.
2. You cannot
operate a business on your own.
In both of these
cases I would advise seeking psychological counseling of some kind,
especially for problem number 1. Perhaps you can find out why you
cannot work for other people, identify the cause and find a solution.
Although psychologists are the usual go-to profession for solving
such problems, perhaps there are other people you can turn to:
family, friends, business associates, business mentors, business
consultants and coaches, etc. Just understand these later people may
not have the training or the interest in helping you solve your
problem. If and when you are able to solve this problem you may find
it much easier to resolve other business related issues.
As for problem
number 2, in additional to resolving your psychological issues you
may be able to find someone who is both trustworthy and competent
enough to manage the business while allowing you to do whatever it is
that you believe you are doing that adds value to the business. Most
of the time this is done by bringing the person in as a partner, or
it might also work if you hire someone to manage your business and
pay them enough to make it in their interest to do so honestly.
Beware! As I
mentioned above the person who manages the business is the real
business owner. If you delegate all the responsibilities of operating
the business without fully understanding what those responsibilities
are then eventually you will become redundant. It is always easier to
find someone to do the work than it is to find someone to manage the
business. If you are ‘in business’ that is YOUR JOB! If you
completely abandon that part of your responsibility whoever is doing
it will end up being the owner.
Owning and operating
a business is one of the hardest things anyone can do. The idea that
you can be successful at that without training, experience or even
interest in learning how to do so is ridiculous. Don’t do it!