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In today’s business climate, serial entrepreneurship is becoming way more common than it was just 5 years ago. However, the difficulties with handling more than one business or with starting afresh repeatedly haven’t waned at all.
To some, serial Entrepreneurship is a child of necessity, but to another group, it is the only reasonable satisfaction for their ever dreaming hearts and idea-generating minds. Many have risen and many have died on this mountain.
If you do find yourself like me in the second category of people, this article is meant to give some guidance as to how to navigate the tricky plane of managing a new business idea. This article contains insights from myself and James Khuri, CEO of Khuri Enterprises and Holdings, a friend and one of the most successful veteran serial entrepreneurs I know. James has business interests in Real Estate and E-Commerce and has started 9 distinct successful businesses.
Related: 5 Success Tips for the Serial Entrepreneur Entering a New Industry
Decide if it is for you
“Some business ideas are so attractive, violent, and beautiful at the same time that they cannot be ignored. You dream about it, see its relevance in everything, and imagine it fully birthed. However, in the words of James Khuri, “Not every business idea is for you to start and run. The world may need that idea, but you don’t need that drama.”
Not every business is the right fit; your ability to discover a need and generate a viable business idea is commendable but not always an indicator that you should start a whole new endeavor or that you should run it if you choose to start it.
The will power and grit required to start a new business is massive, and you already know that from your previous businesses, but what you may not know is that the reason you have been able to succeed so far is your passion for and knowledge of the business you are presently succeeding at.
Khuri co-founded Beautiful Minds, a social enterprise that focuses on empowering younger and aspiring entrepreneurs with Marco Antonio Letona and Noah Schaa a few years ago. The early mechanics of starting the business instantly made him turn it over to them. The company has since grown in leaps and bounds.
Serial entrepreneurship rises and falls on management
A wise man once said, “How you do one thing is how you do everything.” There are sections of people who claim to be serial entrepreneurs who are just unskilled in the art of business and believe that the next one would be “the one.”
However, I tend to take serial entrepreneurs seriously if their present business is pristine and the management is working properly. What proper management structure does for you is that it enables you to gradually take your feet off the pedal and watch your business cruise.
If you really want to cultivate another idea and start another business, the first step is to put your present house in order. Build firm structures around the right team, put in the work to get your business running like clockwork, and this way, you will free your mind to develop other ventures further.
When this is done, you would need to do the same thing with your new business. If you are to maintain your creative liberty and entrepreneurial nous, you need solid structures to uphold your businesses; people, systems, and platforms.
The need for novelty
“A new business can be dead weight or a breath of fresh air, it can help you rediscover that excitement of starting afresh, or it can be a millstone around your neck after the excitement wears off.” – James Khuri
A diversified business portfolio can be intriguing, or it can just be plain heavy. I often advise entrepreneurs struggling with the “distraction” of a new business idea to ensure that the new idea is feasible, profitable, and novel before devoting any iota of time towards developing it.
There is no need to going into an industry to compete with the other existing businesses there, especially if you already have other businesses to worry about. Over 20 years ago, when James first got into Real Estate, he took the highly unpopular and novel route of investing solely in medical buildings. That single decision made him massive profits years later when his company started dabbling successfully in Apartment buildings.
Related: 3 Tips for Starting a Company in an Unfamiliar Industry
The entrance into a new industry is much more crucial for a serial entrepreneur than for a regular entrepreneur. A regular entrepreneur is in it for the long haul and can afford to take his time to dig in, but a serial entrepreneur suffers more for every failure and time wasted because his other ventures suffer.
In simple terms, as a serial entrepreneur, you have to desperately seek a unique angle to enter a market, a novel path that stands you out. As your new business takes root, you can gradually begin pivoting to other areas of the industry.
What about the money?
How do you intend to finance your new business? If your new business idea is an addendum of sorts to your old one, then you can consider financing the new endeavor as an offshoot of the old. However, you need to make sure you do not promote what James hilariously refers to as “entrepreneurial teenage pregnancy.”
This means that not every business is financially stable enough to “have a child” in a manner of speaking. Like with humans, you need to make sure that the old business is mature first of all and able to stand on its own two feet. Pointers that this has occurred are when your business can run with little to no supervision and when your profit margins are still healthy after relevant recurrent expenses and your units are.
The second option I often advocate is self-funding, and by “self,” I mean everyone you know who can give you grants and support. Granted, this is not always easy or possible for every entrepreneur, but it does take a lot of the load off. Banks and investors are a common route that many entrepreneurs take but must be threaded extremely cautiously.
Related: 5 Traits That Distinguish Serial Entrepreneurs
Taking Investment money or bank loans as a serial entrepreneur doesn’t just put your new business in jeopardy should it fail or stumble. It also puts you and, by extension, your other businesses in jeopardy. However, with the right plan, and the right management, a great entrepreneur can make it work.
The plan must therefore be to spend more time analyzing your idea, seeking professional input, and testing it out before you risk it all. As a fellow serial entrepreneur, I applaud your willingness to chop down tree after tree, but at least spend more time sharpening your ax.