Entrepreneurship is an attractive career option for many Canadians — especially millennials. There are approximately 3.5 million entrepreneurs in our country, according to Startup Canada. Increasingly, many of them are immigrants, who now start nearly 40 per cent of all new businesses in Canada.
But at the same time, starting your own business is tough, and the odds of success are slim: about one in five start-ups fail in the first year of operation, and 60 per cent fail within the first three years, according to FundSquire, a global company that provides growth financing to start-ups.
As an entrepreneur myself, I’m frequently asked to dispense advice and tips to people who want to build their own business from scratch — a highly rewarding but demanding undertaking. The following are some of the key lessons I’ve learned along the way.
Make a better product or provide a better service
For people thinking about starting their own business, my advice is to do some research and consider your own experiences purchasing various products and services. There’s an enormous amount of mediocrity in the marketplace, and we’ve all felt the frustration of buying a faulty product or getting poor service. Focus on an area where you think you can do something better. The opportunities are endless. But before you start your own business, you’ve got to work in that field or industry for a few years to learn all the nitty-gritty details about how it operates.
Be prepared to work long hours
The most important bit of advice I give to would-be entrepreneurs and young people striking out on their own is the following: sell your wristwatch and buy an alarm clock. Owning and operating a business means a lot of early mornings, long hours and late nights. You had better forget about 9-to-5 workdays and weekends off, and you’re probably going to have to cut way back on your living expenses. It’s a sacrifice that most people are not willing to make. As the old saying goes: there are many paths to success, but no short cuts.
Be prepared to do all the work
When you’re an entrepreneur, there should be no job or task related to the business that you can’t do. That means everything from taking out the trash to cleaning the glass doors with your company’s shiny new logo engraved on them.
When I started out, I did everything from sales and bookkeeping to machine maintenance and delivering products in my beat-up 1955 Chevy. One time, I was sweeping the tool-shop floor in my oil-stained overalls when a man walked in and asked if I would take him to meet the boss. “You’re speaking to him,” I said.
Put some skin in the game
I was once on a business panel with some other entrepreneurs discussing the topic of starting your own business. A man in the audience stood up and complained that the banks had turned him down for a loan to start his own business. A lot of the people in the crowd agreed, chiming in that the banks were to blame for not giving them the start-up capital they needed. So I asked the man, “How much of your own money were you going to put up?” And he said, “None.” I replied, “Why would the bank lend you some money if you’re not willing to invest in your own business?”
One of the secrets to why the company I started became a global powerhouse in the automotive parts industry was its entrepreneurial work environment. Decision-making was pushed down to the front lines of the business, where the product is made and where contact with the customer is closest. This decentralized structure prevented unnecessary bureaucracy and made the company much more responsive to the needs of customers and employees. No matter how big your company gets, keep it nimble and entrepreneurial.
If you borrow money, make sure you have the ability to pay it back, so you can start over if the business fails. Once your business is up and running, don’t spend more than you bring in. And lastly, always stash away some money for a rainy day. I’ve never yet seen a business with money in the bank go broke.
The rewards of running your own business
Entrepreneurship is a great career option, especially for young people. But as a society, we need to provide real, tangible rewards for our entrepreneurs, the innovators and inventors who drive business growth.
After my lengthy career at Magna, I’m once again starting from scratch with a new private business that focuses on organic agriculture and electric micromobility transportation. Freed from the constraints of working inside a large global corporation, I’m now able to run much faster with far fewer strings attached.
I have the same hunger, drive and desire as when I first started Magna 65 years ago. Most of all, I have one other very important ingredient that I lacked when I first started out: experience. I’m a little wiser and a lot more battle-scarred.