I often find myself disgusted with our government these days, torn between hating any action it takes (case in point: separating families at the border) and throwing my hands up at the lack of action it takes (i.e. preventing the next mass shooting). Yet my DC roots mean that I can't, even for a moment, look away from the slow motion car crash of today's politics (or dumpster fire. or goat rodeo - you choose your favorite analogy). Given the time I spend digesting political news, it helps to come across those occasional bright spots, those situations when you see the potential for good. Otherwise this citizen and tax payer might completely spiral and lose my mind. If you feel me and need a feel-good government story every so often, read on.
Today's story features alocal arm of the Small Business Administration called the Washington Small Business Development Center. I know you may not have heard about the SBDC, but here's why they're important: the SBDC provides business owners what you might expect - online content, links to resources and the occasional in-person training seminar. However, by far the best thing they provide is their Advisor Service. Depending on where you live, there's an advisor available to support your business, generally with decades of experience working in a relevant area. But, get this: meeting with them is totally FREE! As public servants, SBDC advisors aren't trying to sell anything and they have no hidden agenda. They're just trying to make sure local small businesses succeed, since it's majorly no bueno when they fail (think about the cost of unemployment claims and bankruptcy filings). The SBDC offers the business equivalent of preventative medicine. But surprisingly few of the business owners and entrepreneurs I speak to have heard of them.
I must admit that I walked into my first meeting with my assigned advisor, Steve Burke, with a bit of swagger. I was in those giddy, early days, where I thought I'd just made an amazing and bold decision to start a business and it was going to be so, so great. I was there to talk about my greatness for maybe an hour and then go on my giddy way. But Steve had seen my type before. Optimistic. Excited. A 30-page business plan printed and ready to go. That day, Steve put me through a 4-hour crash course in why I needed to check myself before wrecked myself. It was equal parts intervention, Accounting 101, copy editing and loan officer training, as in here's why no bank really wants to talk to you.
The sad truth is that most businesses fail within the first 5 years: 80% in fact! Of the 20% that make it past the first 5 years, another 80% of those will fail in the next 5 years. Holy crap! So we're talking about only 4% that do hang on for a decade or longer. Even in that rarified group, many are actually 'hobby businesses'. These are businesses that are moderately profitable but completely reliant on the owner. An example might be a career coach or someone selling jewelry online. Without that individual owner, the business won't go on. If I've run the stats correctly, this leaves about 2% of businesses that eventually become 'businesses of value.' These are businesses that could be sold one day. Certainly that's my aspiration: to create a business of value. Who knew they are so incredibly rare.... and hard to build!
Hearing those stats was the exactly the tough love I needed when I needed to hear it. At that point, I could have backed out and run back to my day job, or I could have doubled down on doing this right. From that point in our session, it was all about understanding what it would take to beat the odds and become successful. Steve assigned me some reading, The eMyth (which I ended up reading and re-reading and continue to process) and an overhaul of my business plan and financials. My business plan evolved to 6 tight pages, including the financials that now accurately reflect my plans. The revised business plan convinced my landlord I was a capable tenant and my bank I could handle a partial SBA loan. Not often does homework deliver an immediate payback!
Now, I meet with Steve approximately monthly, continuing to dive into my current challenges and quandaries. Whatever I have going on, I know I've got someone available and in my corner. He's even offered to come tour my site when it's under construction and look for any red flags. That's definitely an offer I would never refuse.
In short, if you own a business or think you might some day, get thee to an advisor ASAP. If you are a rockstar businessperson who's got it figured out, think about becoming an advisor. And everybody else, just enjoy a little knowledge that government can do right now and then. Like a business of value, it's a rare and beautiful thing.
Until next time.... XOXO Susannah