Should I start my own business?

Since starting my own business back in 2006, its something that I get asked every few months by someone:

“Should I start my own business?”

It’s always a tricky question to answer because there are so many different types of business. I also get asked what’s the best bit about running your own business, and having been an employee and now an employer, that I can answer more clearly.

So whats the best bits about having your own business?

  • You get to make decisions that will affect your future and the direction of your business
  • You can change direction quickly and explore new ventures without having to ask permission from anyone
  • You can work flexible hours
  • You get to choose where you work from, particularly if you run a business where you can work from anywhere with a laptop. We occasionally run one of my businesses from a local coffee shop!

Ground Coffee Shop - January 2016

  • You can balance work and personal commitments much more easily
  • You can choose the way your business will operate, and follow your ethics

Decisions, decisions, decisions!

One thing that it is important to stress is that running your own business involves so many decisions every day that if you are an on-the-fence sort of person, this is going to be difficult!

You will make plenty of decisions that in hindsight were not the best decisions, and the most important thing is that you learn from the not so great decisions so as to not repeat the mistakes.

There are down-sides to having your own business though….

  • Those flexible working hours can easily slip into an all-consuming number of hours. You need a wife / husband or significant other to keep you in check. Its always good to have someone who says “you need to be home for dinner by 5:30”, otherwise it will be 10pm and you will still be working on “just one last thing!”
  • The money management can be stressful, particularly when it comes to sorting out your accounts at the end of the year.
  • You will get a ridiculous amount of paper arriving in the post. Its a complete chore to read it, so make sure you have a large recycling bin.
  • Banks are still operating on procedures from the last century and are a nightmare. It doesn’t matter what bank you choose, they still require you to go in and visit in person, and use several forests worth of paper to set up a bank account.

Things you need to know at the start

  • HMRC and government departments don’t work on normal calendar years like the rest of society, they work on a ridiculous Financial Year model, where their new year (and thus yours) starts on the first Monday in April each year and ends at a day on or after the 31st March the following year. There is added complexity that your financial year is different again with it beginning from the month that you started your company.
  • You need to file annual company accounts with Companies House once per year
  • You need to file a different version of the same accounts with HMRC once per year. (You would think that submitting them once would do, but no, that would be much too sensible and easy for a government department!)
  • You need to also file a personal tax return with HMRC once per year

Sole trader or limited company?

So, if you have decided that you should start a business, the next question is whether you should go self-employed or start a limited company. I think that there is an easy way to decide this.

Do you have expensive personal assets like a car, house (with a mortgage) etc. that you don’t want to risk loosing?

If your answer to this is yes, then you should consider setting up a limited company. For some of my companies I have used https://www.rapidformations.co.uk – they have an online form that you use to add all your details and it costs about £15 and takes a couple of hours. Once you have set up a limited company it costs about £15 per year (that you pay to Companies House) to keep it registered.

If your answer is no, then you are probably better being a sole-trader. This makes your accounts much simpler, and you have less “with my company owner hat on” juggling to do. You ARE the company. One very important thing is that you have a completely separate business bank account for your business transactions. Don’t just use your current account, as at the end of the financial year this will make your life exceptionally complex.

Your biggest challenge is…..

The biggest obstacle you face in running a successful business is the ridiculously over-complex processes and hoops that the government makes you jump through. There are deadline dates, and if you miss them, the fines can sink a small business very quickly.

Keep a digital calendar, with reminders and always add the important dates in to it:

  • The date you started the company, and make it like a birthday where it repeats annually
  • When you get told when you have to submit your annual return by Companies House, put it in your calendar with an annual reminder for a week before. If you can complete it before they have to chase you thats always a good thing

Annual Accounts can be done very, very simply

You can complete your annual accounts really easily, using an excel spreadsheet. The best way is to use Companies House. http:/www.companieshouse.gov.uk – you have to keep your limited company details up to date once per year on there anyway.

  • Keep a spreadsheet with this minimal information:
    Record all the money you get IN on one sheet,
  • Record all money OUT on another separate sheet in the same spreadsheet
  • On a third sheet of the spreadsheet, in one row, record the balance of your bank account at the start of your financial year
  • Add money in to this amount, then take away money out, the result should be the amount currently in your bank account. If it isn’t, then you have missed something!

Final small pieces of advice!

  • Don’t be afraid to say no, its better to turn down work and disappoint one potential customer than to over-stretch yourself and disappoint two customers by not delivering
  • If you don’t have it, don’t spend it. You cannot go bankrupt if you don’t owe people money
  • Don’t be afraid to say no, its better to turn down work and disappoint one potential customer than to over-stretch yourself and disappoint two customers by not delivering.
  • Get help from experts – find a local business group and go along and ask lots of questions!
  • Try to use as little paper as you can, paper accumulates and at the end of the year you will find your kitchen table completely swamped with a paper nightmare. The easiest way to achieve this is to not buy a printer, store everything digitally (take photos of receipts that you have added to your spreadsheet).
  • Invest in your business. If you are running an IT business, and you have some money, don’t go and tie yourself in to a lengthy BMW monthly contract for a nice new car that looks flash, get the best IT equipment you can afford. If your computer doesn’t turn on in 3-5 seconds, you need to get better equipment, you will be using this a lot, and if it is slow then everything takes a long time!

Get help getting started

Find a company like Venture Mosaic that helps business getting started with their branding, materials and web presence as well as .

Essential viewing for web developers

Every now and again I come across some amazing videos on YouTube that I think are relevant to all web developers. One author (video blogger? – not sure what they are called) who is particularly brilliant is Tom Scott. He wonderfully articulates how web technologies and their exploits happen, and how to ensure that you don’t fall in to the same traps as many systems/sites out there.

One of Tom’s most brilliant videos is his explanation of how a self-re-tweeting tweet worked and how to ensure that you don’t have the same issues on your text boxes when writing their contents back out to the screen.

Essential viewing videos for development teams:

Tom Scott – Cracking Websites with Cross Site Scripting – Computerphile

Tom Scott – Hacking Websites with SQL Injection – Computerphile

Dr Mike Pound – Advanced SQL Injection

Tom Scott – Cross Site Request Forgery – Computerphile

Tom Scott – How Not To Store Passwords

Tom Scott – Hashing Algorithms and Security

 

If you are a developer, and have any suggestions of videos that should be added to this list, please add a comment with the URL!

Starting a business – liberation from the illusion

Elon Musk

The Monk Moment – Many great entrepreneurs have had a moment when they have lost everything. Monks create this situation intentionally through “Vairagya” when they give up all money and possessions. Many entrepreneurs end up in the same situation unintentionally. smile emoticon

Elon Musk lost $180M and was in debt in 2008. Seven years later, he’s worth $13 billion, but he’d be ready to risk it all again. Steve Jobs lost his entire Apple fortune by 1994, betting it on NeXT and Pixar. In 1995 everything turned around, he sold NeXT to Apple, Pixar to Disney and he passed away an icon. Walt Disney mortgaged away his entire fortune in the 1950s to build Disneyland, against everyone’s advice. He too went from giving up everything to becoming a legend. Each bet everything material they had on something invisible – their purpose and vision.

Monks call the state that comes after giving up everything “Moksha” which means liberation from the illusion. We’re not alive until we know what we’d die for.

I’m not saying great entrepreneurs are monks, but they do have ‘monk moments’ when they lose everything.

Many of the greatest entrepreneurs unintentionally find themselves in this state by betting everything on their dream. Maybe you’re in this place right now. It is a place of pure power. When you have nothing to lose, you have infinite potential.

That is provided you don’t focus on what you’ve lost, but on everything you have to gain. That’s when everything turns around. As Walt Disney said “I don’t make movies to make money. I make money to make movies”.
That’s the paradox of entrepreneurs having a ‘near-death’ experience where they lose it all. Steve Jobs wrote:

“Remembering that I’ll be dead soon is the most important tool I’ve ever encountered to help me make the big choices in life.

Almost everything–all external expectations, all pride, all fear of embarrassment or failure–these things just fall away in the face of death, leaving only what is truly important. Remembering that you are going to die is the best way I know to avoid the trap of thinking you have something to lose. You are already naked. There is no reason not to follow your heart.

No one wants to die. Even people who want to go to heaven don’t want to die to get there. And yet, death is the destination we all share. No one has ever escaped it, and that is how it should be, because death is very likely the single best invention of life. It’s life’s change agent. It clears out the old to make way for the new.”

What mission is so important to you, that you’d be ready to clear out the old and make way for your new?

Starting a business – learn from others

Instagram

18 months & 3 simple, not-so-simple steps to $1 billion…

Today, Instagram sold to Facebook for $1 billion. A week ago, when TIME asked Instagram founder, Kevin Systrom, if he would sell the company, he said “It’s not really on the top of our minds right now.”

Kevin is 27 years old and started Instagram 18 months ago with Mike Krieger, in October 2010. The company has grown with just 4 staff, and today has just 9 in the team. With the $1 billion deal that was announced today, was Kevin just plain lucky, or was there some simple steps that he (and others who have had the same luck) have in common?

Here’s three steps he followed. They may not guarantee you exactly the same success – but they will increase your own good fortune:

1. THING BIG FROM DAY ONE – THEN LEARN FROM OTHERS:

It was while Kevin was studying at Stanford 7 years ago that he had the idea of a photo-sharing site, from his passion for photography. That was before iPhones, and before Facebook. Step one is to cultivate your idea by learning from others. He met Mark Zuckerberg in 2004 and talked about his idea. Mark then offered him a job at Facebook, which had just launched (in hindsight, a cheaper option that the $1 billion he’s just paid to work with Kevin). Kevin turned him down but they stayed in touch. He went to intern at Odeo with Evan Williams, who sold Blogger and Jack Dorsey, who launched Twitter. This is where Kevin got to understand the power of social sharing. Kevin later said “Comparing Instagram to photography is like comparing Twitter to Microsoft Word”.

He then went on to work at Google. All in all, it was a full six years after having the idea of a photo sharing site that he worked with others leading the field: Getting paid for his own education before he launched his own start-up. As Kevin says, “I was given the opportunity to be in the middle of a ton of innovation, and meet some of the smartest people doing the coolest stuff in the world. When I finally did it [myself], it just felt so right.”

Who could you (and should you) be working with today to lay your own foundation?

2. KEEP 100% FOCUSED ON WHAT PROBLEM YOU’RE SOLVING – AND FAIL FIRST:

When Kevin launched Instagram in October 2010, he explained in his first blog what problems Instagram intended to solve. He listed the top three problems users were having:

“My mobile photos look lame.”
“It’s a pain to share to all my friends.”
“Photos take forever to upload.”

How would he know these were the problems? Just by talking to people? No, by getting it wrong the first time. In early 2010 he launched his first attempt “Burbn” as a location-based photo app, using Foursquare. It was a one-man-band, but after a year of hard work it had failed to catch on. It was, however, a failure that allowed him to learn from his users what would work, and to attract interest from like-minded people, including his future co-founder of Instagram, Mike Krieger.

By focusing on these three problems, Instagram launched in October 2010. Kevin relates the first moments of launch: “It was 12:15am, October 6th and we had been working on the app non-stop, day and night for 8 weeks. With a bit of hesitation, I clicked the button that launched “Instagram” live to the Apple app store. We figured we’d have at least 6 hours before anyone discovered the app so we could grab some shut-eye. No problem, we figured. Within a few minutes, they started pouring in… The night of sleep we were hoping for turned into a few meager hours before we rushed into the office to add capacity to the service. Now, only a couple months later, we’re happy to announce that our community consists of more than a million registered users.”

What problem are you solving, and what are you learning by failing, that is setting you up for your own overnight success?

3. CUT OUT ALL THE NOISE:

Kevin explains the difference between Instagram and Burbn: “We actually got an entire version of Burbn done as an iPhone app, but it felt cluttered, and overrun with features. It was really difficult to decide to start from scratch, but we went out on a limb, and basically cut everything in the Burbn app except for its photo, comment, and like capabilities. What remained was Instagram.”

Kevin cut out all the noise. He then launched Instagram just on the Apple App Store (It just came to Android last week) and focused on sharing on Twitter and Facebook (Three platforms that didn’t even exist when he first had the idea). That’s it: Photo, comment, like. No other platforms. No other noise.

Simpler means sharper means easier to cut through the noise. Instagram went from one million users by Dec 2010 to 30 million users today. In 2011, Apple named Instagram the “App of the Year”. Why would Facebook buy it now for $1 billion? Because Mark already knows it will add more value than that to Facebook when it has its upcoming $100 billion IPO.

If you are already thinking big, connecting smart and focused at the problems you are solving – How could you solve them in the fewest number of steps?

A BILLION DOLLAR STORY

It obviously takes more than three simple, not-so-simple steps to get the pieces lined up and timed right for the kind of 18 month run that Kevin has had. But these three show up again and again in today’s stories of hyper-growth, and the ones I will continue to share here on Facebook and at my Fast Forward events.

As an end to this chapter of the Instagram story, here’s how Kevin relates the beginning of his photo-sharing idea. It is at the heart of his journey, as your story should be at the heart of yours:

“When I studied abroad my teacher set what I do now in motion by saying, “Give me that camera of yours.” He took my camera away and gave me a little, plastic camera. I was studying in Florence at the time and he told me that I wasn’t allowed to use my camera for the rest of the class. I had to use this plastic camera with a terrible lens. He said I was too focused on sharpness and “I feel like you’re more artsy than that.””

“He said, “I want you to use this Holga,” this plastic camera with a plastic lens that had this cult following in the ’80s and ’90. I was blown away by what it could do to photos. My photography teacher was totally right. I was too focused on being meticulous with these really beautiful, complex architectural shots. It helps to see the world through a different lens and that’s what we wanted to do with Instagram. We wanted to give everyone the same feeling of discovering the world around you through a different lens.”

It’s ironic that as Instagram hits a $1 billion value, mimicking the feel of these disposable cameras, the biggest producer of them, Kodak, has filed for bankruptcy.

Each wave that crashes is followed by another. The only question is who is already positioning themselves to surf it. Are you up for the ride?

Starting a business – just a tweet away

Billion Dollar TweetHere’s a tweet Travis Kalanick sent in January 2010. The reply from Ryan Graves happened 3 minutes later. That tweet was worth over a billion dollars.

January 2010 was the month Travis was doing a test run with 3 cars in New York for a mobile app that he and his friend, Garrett Camp, had just created.

They had decided it was time to start a company around the app and, needing to find a General Manager to run it, Travis took to Craigslist and Twitter looking for the right person.

Ryan’s reply to Travis came as he was looking for something new. He had some experience at GE, and had worked for Foursquare for a while for free after the company turned him down for a job. He was ready for a new opportunity – and took a chance with this tweet.

Travis replied back, they met, they hit it off, and Ryan joined Travis and Garrett on March 1st as their first hire.

With their new company started, the three of them then invited all their friends to demo the product and they officially launched in San Francisco just 3 months later on May 31st.

That was five years ago.

This week, the team that started with that tweet has built their company, Uber, into a company that is currently valued at over $60 billion (they just announced another funding round of $2 billion this week http://bit.ly/ubers-next-2-billion).

Today, Travis and Ryan are worth over $6 billion, and that tweet from Ryan (who today is Uber’s Head of Global Operations) began a journey which has made him a billionaire today as well.

How are you using Facebook, Twitter, LinkedIn and Youtube today?

As a wall of content? As a broadcasting tool?

Or, like Travis and Ryan, as a way to find the resources, connections and opportunities you need when you need them?

Depending on how you use it, social media can make you feel apart from everyone, or one step to anyone.

It can overwhelm you, or empower you.

It can be a time waster, or a time saver.

“Never confuse motion with action.”
~ Benjamin Franklin

What do you need or who can you help today? It may just be a tweet away.

Of course, there is no promise that one connection or one tweet will result in you making a billion dollars or impacting a billion lives.

But there is no promise it won’t either.

Starting a business – Customers not products

User Experience vs Design

Best advice if you’re just starting or growing a business:

Focus at your customer more than your product. Get fixed on your customer experience, and your product will keep changing to serve them best. But fix your product, and customers will find a path that fits them, with or without you.

If you’re waiting on the street corner, wondering where all your customers are, this post is for you.

We’ve moved from the industrial age where it was all about the product and productization to the technological age where it’s all about the customer and customization.

Instead of focusing at product development and production lines (which we learned about and were a part of at school), focus at customer experiences and customization lines.

Your business doesn’t start when you have a product. It starts when you have a customer. So who is your perfect customer? Start from there and ask yourself (and them):

Problem – What’s the problem they need solved?
Promise – What’s the benefit you deliver to them by solving it?
Product – How will you solve it better than others?
Proof – Why should they trust you?

Keep upgrading your answers (and your products) regularly. Because what your customers need, their expectations and how they are being served will keep changing fast. And once you get into flow, you’ll begin to know what they need before them, and they’ll begin pre-buying your next product.

“Get closer than ever to your customer. So close that you tell them what they need well before they realize it themselves.” ~ Steve Jobs

The easiest way to future proof your business is to have customers that love you. The easiest way to fail is to love your idea or product more than you love your customers. So find your soul-market and fall in love all over again.

Security Flaw Puts Millions Of Samsung Galaxy Phones At Risk

If you are a Samsung Galaxy owner, there is yet another worrying announcement – there is a security flaw that lets attackers install malware on to your device or, alternatively, eavesdrop on your phone calls.

Chicago-based security firm NowSecure has published a report that claims the bug lives in the SwiftKey keyboard software (The SDK Version only), which is installed on more than 600 million Samsung devices. It states the bug can allow a remote attacker, which is capable of controlling a user’s network traffic, to execute an arbitrary code on the user’s phone.

Samsung Galaxy Phone

The security flaw concerns the SwiftKey keyboard software, which comes installed by default. More worrying is that there is no option to uninstall the SwiftKey keyboard, if it’s there, it’s there for good.

An unscrupulous individual can secretly install malware on a user’s device, access the camera, microphone and GPS, and listen in on calls and messages, change the way other apps behave and even steal photos and text messages.

NowSecure also claims it notified Samsung on this problem towards the end of last year. Samsung did provide a patch to amend the problem to network operators earlier in 2015 but it’s not known if this patch was made available to many users by the networks.

Potentially affected devices include the Samsung Galaxy Edge, S6, S5, S4 and the S4 mini.

As the software can’t be uninstalled, NowSecure have said the best way to tackle the situation is to avoid unsecured wifi networks, which is really a completely impractical bit of advice for most phone owners.

“We supply Samsung with the core technology that powers the word predictions in their keyboard. It appears that the way this technology was integrated on Samsung devices introduced the security vulnerability.”
– SwiftKey CMO Joe Braidwood.

SwiftKey also confirmed that the problem doesn’t affect the version of the app that can be manually downloaded from the app store.

There are already lists of over half a million infected Android phones that you can connect to and turn on their camera remotely that are available on Tor, so keep an eye on your phone, and if you see the camera light coming on, turn the phone off immediately and report it to your local police.