3 Ways To Overcome The Fear Of Starting A Business

So, you’ve had this idea of starting a business for a while now. You know, the one you keep daydreaming about at work? You start to get excited thinking about the possibilities, but then you second-guess yourself, wondering if you’ve really got what it takes to be an entrepreneur.

Let me start off by saying that this is a totally normal feeling, and it’s an even harder decision to make when you’ve already got a great thing going with a stable job, a regular paycheck, and some sweet health benefits. Logically, the smart move is to stay put, but deep down, there’s this little voice telling you that you’re meant for something more.

Just because you have fears about starting a business, whether it’s a lack of experience, financial insecurity, worries about what friends and family would say if the business fails, or something else entirely, it doesn’t mean you’re not meant to be an entrepreneur. If anything, it shows that you’re taking the whole idea seriously. But rather than continuing to let these fears keep you from chasing your dreams, why not do something to see if they’re actually legit?

Related: A Lot Of People Want To Start A Business But Don’t – Why?

So, if you find yourself daydreaming about starting your own business but are paralyzed by fear of the unknown, you’re not alone. But it’s time to finally do something about it. To help you figure out whether your idea is worth pursuing, I have three things for you to try that have helped many of my clients who were in this same situation. Doing these should help give you the confidence to move forward with your idea or stop thinking about it.

Do Some Market Research

The core purpose of any business is to solve a problem for people, so my first recommendation is to get crystal clear on who your ideal customer is and why they may want what you would be selling. Start by asking yourself questions like: What are their needs, wants, and pain points? What keeps them up at night? What solutions are they searching for?

To find these answers, you’ll need to do some digging. Look at current trends in your industry and read up on market reports. But don’t stop there – get out there and actually talk to people who might be buyers of your product or service. Strike up conversations, ask questions, and really listen to their responses. The goal is to gain an understanding of your target audience. You might be surprised by the number of new entrepreneurs who won’t do this because they are afraid of telling someone their business idea but are comfortable with taking out a huge loan on a business because they think people want their product or service. Sometimes it works out, but sometimes it doesn’t.

To illustrate this point, a report by CB Insights revealed that 42% of startups fail due to a lack of market need for their product or service.¹ Furthermore, a study by the Harvard Business Review found that 75% of venture-backed startups fail, often due to a lack of understanding of customer needs. These statistics underscore the importance of conducting thorough market research to validate your business idea and ensure that there is an actual demand for your products or services.

Once you have a solid grasp on your ideal customer, it’s time to ask yourself the million-dollar question: Will your business idea fill a genuine need or solve a pressing problem for them? This is where you’ll need to be brutally honest with yourself. It’s easy to fall in love with your own idea, but the beauty of doing market research and talking to potential customers is that it helps eliminate that nagging fear that nobody wants what you’re selling. By having conversations with your target audience and getting their feedback, you’re validating your business idea in the real world. You’re not just relying on your gut instinct or a hunch – you’re basing your decisions on actual data and insights from the people who matter most (the people who are in the market for your products or services).

And if you discover that your initial idea doesn’t quite hit the mark? That’s okay! In fact, it’s better to find out now, before you’ve invested a ton of time and resources into something that might not fly. Use that feedback to refine your idea, pivot your approach, or even come up with a brand-new idea.

Run the Numbers

One of the most common fears aspiring entrepreneurs face is leaving a steady paycheck and starting a business that might not generate enough income to sustain itself or provide a comfortable living. This is where financial projections come into play. However, before diving into the process, there are three points to keep in mind:

1. As a first-time entrepreneur, you probably haven’t created financial projections before, and that’s okay.
2. Even projections prepared by experts will be wrong. There are far too many factors to consider when starting a business, and financial projections are simply best guesses of what will happen.
3. Entrepreneurs tend to be overly optimistic, and when you’re deeply involved in your business idea, it can be challenging to maintain objectivity.

Despite these challenges, creating financial projections is still necessary. According to a study by U.S. Bank, 82% of small businesses fail due to poor cash flow management.² By preparing these projections, you’ll gain valuable insights into your business’s potential profitability, allowing you to make better-informed decisions about pricing, expenses, and growth strategies. Additionally, you’ll be able to create a detailed budget, forecast your cash flow, and determine the amount of savings you’ll need to sustain yourself and your business during the startup phase. This information will help you decide when to leave your job and how to manage your finances during the transition.

It’s also important to keep in mind that 58% of small businesses started with less than $25,000, and one-third of successful small businesses started with less than $5,000, according to a survey from Kabbage.³ This means that many successful businesses have started with modest financial resources, and you don’t necessarily need a large sum of money to get your venture off the ground.

To ensure that your financial projections are as realistic as possible, seeking a second opinion from someone with relevant experience and expertise is highly recommended. This could be a business mentor or an accountant who can help you refine your numbers. By sharing your projections, you can gain a fresh perspective, and they can provide valuable insights into industry benchmarks, pricing strategies, and financial best practices that you may not have considered. This knowledge can help you adjust your projections and make more realistic assumptions about your business’s potential.

Sharing your financial projections with others can be intimidating, especially if you’re new to entrepreneurship. However, you’ll build confidence in your numbers and overall business strategy by seeking feedback and validation. Remember, these individuals are there to support and guide you, not to judge or criticize your efforts.

Start Small and Test Your Idea

Last, starting small and testing your idea is a powerful way to overcome the fear of starting a business. Taking a lean approach to launching your business makes a lot of sense, especially if you are worried about the financial risk of leaving your job or the uncertainty of your entrepreneurial skills.

In fact, a survey by Fundera found that about 60% of entrepreneurs start their businesses as home-based operations.⁴ This statistic highlights the prevalence and viability of starting small, as many successful businesses have begun in the founder’s home. Additionally, a study by SCORE revealed that 66% of small business owners reported that they started their business with personal savings.⁵ This underscores the importance of starting small and testing your idea before investing significant financial resources.

By starting small, you can validate your business idea without risking a significant amount of money or leaving the security of your current job. This allows you to test the market demand for your product or service and refine your offering based on customer feedback, all while maintaining a steady income.

I get that testing your idea will be easier for some types of businesses than others. For example, if you’re considering starting a digital marketing agency, you could begin by offering your services to a few clients on a freelance basis while still working your day job. On the other hand, if you’re planning to launch a physical product, starting small might involve creating a prototype. While this process may require more time and resources compared to service-based businesses, it’s still a better approach than investing in full-scale production right away.

Regardless of your business type, starting small gives you the opportunity to learn valuable lessons quickly and adapt your business model as needed. This flexibility is especially important in the early stages of your business while you figure out what works and what doesn’t. You’ll be able to make mistakes on a smaller scale and learn from them without jeopardizing your entire venture. I would argue that starting a business can be the ultimate MBA, and as you achieve small successes and overcome challenges, you’ll gradually build confidence in your real-world abilities as an entrepreneur.

Wrapping Up

Starting a business is a significant decision that comes with a fair share of risks and uncertainties. However, I think it’s also important to recognize the cost of letting your entrepreneurial dreams remain just that – dreams. Fear can be a powerful deterrent, preventing you from taking the necessary steps to turn your vision into reality. But ask yourself this: if in 10 years you are still at your job, will you look back with regret, wondering what could have been if you had taken action?

If you find yourself trapped in the cycle of daydreaming about starting a business without making progress, consider using one or more of these strategies. Ultimately, the only way to determine if your fears are justified is to confront them directly and take deliberate steps toward building the life and business you’ve always envisioned.

Is there a specific fear that’s keeping you from taking the leap into entrepreneurship? Or, perhaps you’ve started a business by overcoming a fear that had been holding you back. If so, what techniques or mindset shifts proved most effective in helping you break through those barriers? Let me know in the comments – your story could be the encouragement someone else needs to take action.

Sources

1. https://www.cbinsights.com/research/report/startup-failure-reasons-top/ ︎
2. https://spend.usbank.com/blog/closing-strong-year-end-cash-flow-strategies-monitoring-and-the-role-of-spend-management-platforms ︎
3. https://www.prweb.com/releases/kabbage-data-reveals-one-third-of-successful-small-businesses-started-with-less-than-5-000-833313291.html ︎
4. https://www.fundera.com/resources/home-based-business-statistics ︎
5. https://www.score.org/headline/entrepreneurs-rely-personal-savings-second-jobs-fund-critical-first-year ︎