In entrepreneurship, your first year of business can set the tone for the future health of your company — and new business owners face tough odds.
According to the Bureau of Labor Statistics, 20% of small businesses don’t make it past the first year mark, and nearly half of businesses close by their fifth year. In other words, if you want your business to make it in the long run, your first few years of business matter.
Now I want you to imagine you have the opportunity to have a coffee chat with a group of successful entrepreneurs to gain their insight on what to do in your first year of business to set yourself up for success. Sounds like a cool opportunity right? Well, keep reading.
Though I can’t supply the coffee, I did ask successful entrepreneurs what advice they would give new business owners to rock their first year of business — here’s what they had to say.
First Year of Running a Business
1. Work-life balance is up to you.
Being your own boss is the ultimate key to freedom and flexibility, right? Well, not exactly. As an entrepreneur, especially in the early stages of business, you’re wearing a lot of hats and it can be tempting to work all the time. Justin Hayashi, CEO and co-founder of New Engen reflects on the advice he would have given himself in his first year of business:
"If I could give myself advice in my first year of New Engen, I’d urge myself to prioritize balance between work, health, and relationships. Early on I was enamored by the many entrepreneurs who asserted that major sacrifices and long hours are necessary for success.
Every day I woke up early to immediately start working and worked late into the night. I tried to work every possible hour out of fear that the company would fail if I didn’t. At least, that’s what many ‘thought leaders’ led me to believe.
I don’t mean to downplay how much commitment and hard work is necessary in the first year starting a business, but there’s not nearly enough emphasis on the importance of balance for entrepreneurs."
While running a company, taking care of yourself is an important investment in the future of your health and the health of your business. "Balance is what allows you to make critical, clear-eyed decisions," says Hayashi. He continues:
"When you’re heads down and pushing your body and mind to its limits, you can easily lose sight of the forest through the trees. As a leader at a startup, each decision carries significant weight.
Each wrong turn costs time and money – sometimes to a degree you can’t afford. Ultimately, I feel fortunate to have made more right decisions than wrong decisions in that first year, but we could have achieved key milestones faster had I given myself more space and time away from work."
As you get into the groove of entrepreneurship, check in with yourself regularly to spot the signs of burnout, and adjust your routine as needed.
2. Focus on your processes.
As a goal-oriented entrepreneur, you can easily fall into the trap of solely setting your sights on the milestones you’d like to achieve. Tim Salau, Mr. Future of Work and CEO and co-founder of Guide encourages new businesses owners to focus on what’s in front of them. He says:
"Take things one day at a time. When you're building a venture, focus on being present in the moment. You don't have to rush outcomes — keep building and pushing, but be presently aware of what and why you're building.
Rome wasn't built in the day, the same applies for your venture. Understand when to move fast and slow."
Reaching for Big Hairy Audacious Goals (BHAGs) is fantastic, however, small actions and daily decisions are what make BHAGs possible. When you’re building a company from the ground up, your first year creates a foundation that will need to sustain your company as it grows and evolves.
During this critical time, prioritize creating sound, efficient processes that can scale with your company.
3. Build a support squad.
Entrepreneurship can be isolating, especially for solopreneurs. When you don’t have a co-founder or colleagues you can rely on for questions or support, building a strong network becomes even more important.
Megan McNally, founder of FBomb Breakfast Club, emphasizes the power of support for new business owners. She says:
"Build your power squad. Make it a priority to surround yourself with others who’ve been where you are, built what you’re building, and navigated the challenges you’re going to face. And treat those relationships like gold, because you’re going to lean on them a lot."
Whether you join a network for entrepreneurs, or set up standing virtual coffee chats with a group of founders who are at a similar stage in their businesses, making the effort to seek out genuine connections and joining safe spaces where you can ask questions and gain feedback is invaluable.
4. Find what works and stick with it.
When you’re trying to get the word out about your new business, it can be tempting to constantly switch course in search of what will help your brand grow. Nadine Joseph, founder and CEO of Peak and Valley, encourages new entrepreneurs to hone in a sensible marketing strategy and give it time to work. She says:
"In terms of marketing, I encourage new entrepreneurs to find a channel that works and stick with it. I had a bad case of ‘shiny object syndrome’ in my first year of business. I was excited to try every new marketing tactic I found out about.
That led to me diluting my capital amongst too many marketing channels, which is a killer problem to have as a bootstrapped business. Once I doubled down on the one to two marketing channels that worked for Peak and Valley, I was able to see some scalable success. Focus and consistency are key!"
Each level of success you reach unlocks new challenges and learning opportunities. Shontay Lundy, founder of Black Girl Sunscreen offers this advice to new entrepreneurs: "Follow your intuition, and keep an open mind to different strategies."
As an entrepreneur, your ability to pivot and learn new ways of doing things is crucial for the success of your business and ability to lead effectively. Understand that what got you here won’t get you there — your willingness to adopt new strategies and ways of doing things can help your business grow and run more efficiently.