What’s the hardest part about starting a new business? What’s that break through moment where you know that you’re on to something?
There are many ways this discussion can go. I wanted to narrow it down to one key point. This post is for every single rookie to the game.
When do you know that you’re business had some legs to stand on?
The first time you make a few dollars.
I remember when I first started Studenomics in late-2008. I put up a bunch of articles and I worked long hours to spread the word. I didn’t know what I was doing at all. Studenomics was just a hobby for me. It was a way I could help other young people manage their money better. I just wanted to help others. I also wanted to write about money since this was my favorite topic at the moment.
I never really saw it as a business idea or anything like that. Then one day an advertiser emailed me to buy a text link. I was shocked. I charged $20 per month to put the text link up. I was thrilled to have money coming in. I could finally afford a cup of coffee.
Someone was actually willing to pay me to write about personal finance. Amazing!
Why are the first few dollars so important in starting a new biz?
Tangible proof.
You can have all of the theory in the world at your disposal. It doesn’t mean anything until you get some tangible proof. Your theory also doesn’t mean anything until you start applying it. Whether you want to start freelancing or a physical business, the first few dollars you earn are the tangible proof that you’re onto something.
When I took the Earn1k course with Ramit Sethi, he stressed the importance of finding your first three paying clients with your business idea. Your first paying clients/dollars you earn provide you with all the tangible proof that you need to see if you can get your new biz off the ground. Until you get to this point you’re just day dreaming with your new biz.
Shows that there’s a market.
You can have a great idea. Your mother and girlfriend may agree that it’s the best idea in the whole wide world. The reality is that this idea is worthless until you prove that there’s a market for it.
The best way to determine if there’s a market for your product revolves around generating some money.
If you can’t make any money off your “great idea,” then there’s really no market for it in most cases. Making your first few bucks proves that there’s a market for your business offering.
A psychological boost.
It can be discouraging to work on a business and not see any results for your effort. Even if you believe in your new business offering, those around could start losing support when they notice that there’s no growth.
Making those first few dollars will give you the motivation that you need to keep on moving forward. It will also inspire those around to hold their faith in your idea. We all need a psychological boost sometimes.
Brings your idea from hobby to potential business.
There’s a big difference between a hobby and a business. That difference is money. A hobby is something that you do for fun. A business is something that’s supposed to earn you money. When you start making money from your hobby, you can proudly know that you’re turn a passion into a business. A hobby is great. A business is even better.
What was the greatest moment in your new business? When did you realize that you might be able to get your new project off the ground?