They say that one of the best ways to learn is by making mistakes. I’ve seen this first hand with my own kids. It’s called natural consequences. Judge me if you’d like, but I’ve let my kids “fail” and make mistakes on purpose so that they learn from it and don’t make the same mistakes again. It would be nice if this worked 100% of the time but it doesn’t. There have been so many times my daughter has forgotten her coat or gloves for school. She comes home and complains about being cold, yet she does it again. Why is that? Well for one, she’s 6, so part of it is age. But I think another reason is that she is so focused on the present.
Oftentimes we forget to plan or look toward the future which results in us making mistakes or poor decisions. My daughter is very much a child who is caught up in the moment and she doesn’t look ahead, which means she forgets things like her coat, homework, water bottle or gloves. Don’t worry, there are a lot of times that I step in and help her remember as a good parent should, but I do let her fail some days so she can learn the natural consequences of not bringing things to school. How would she learn from her mistakes if I never let her make mistakes at all?
I’d love to tell you about some of my past business failures.. I mean ventures. I’ve always had an entrepreneurial spirit, like I would assume you have since you’re reading this. It’s just in my bones. I’ve spent many hours dreaming, planning, and strategizing – but many entrepreneurs, like myself, make crucial mistakes that cost them their business. If I knew then what I know now I’m sure I would have done things differently. But everyone’s journey into business ownership is different. You could fail 5 times and finally be successful. You could have a multi million dollar business on your first attempt. I think the two most important factors of business success are mindset and due diligence. We’ll dig into those in a bit, but let me take you 12 years back and tell you about one of my first business ideas.
Right after college I had the idea of starting a home inventory business. It was called P3 Inventory. The Ps stood for Personal, Property, and Protection. What I did was come into your house and took a full inventory of your belongings. I took videos, pictures and a detailed written list of all of the items in your house. This information would then be useful if you were to ever have a house fire, tornado, etc come through and destroy your stuff. Turns out this takes DAYS to complete and people didn’t want to pay that much for the service, and it was a terrible hourly rate for me. Also, it was incredibly boring. So I did a few and then decided to move on. I wanted to start another business that was less time consuming and one where I’d make better money. Thankfully I only invested a couple hundred dollars into this business so I really only lost my time. Side note: I never even did my own house and we ended up having a house fire in October of 2017 and a lot of our belongings were destroyed! Ironic, huh?
My next business idea came a few years later when I had young kids. Both me and my husband worked full time jobs and finding childcare was hard! I had a friend that did in-home daycare in her house and thankfully she had availability for our 2 kids, but before we found her we did a lot of searching, visiting, interviewing both centers and in-home daycare options. This took so many hours. I saw that the process was terrible and thought there should be a better way for busy parents to find a good fit for childcare. I created a website called Second Pouch which was essentially a Zillow for in-home daycares. I started with in-home daycares because those were harder to find information for online. The idea was that I would add centers later and essentially have all of the hundreds of options available to parents on an easy to use website. I started with my city but wanted to expand to the whole US. They were able to view the daycares on a map or list, filter by things like hours, pricing, availability of different ages, certifications, etc. Each daycare had their own listing with pictures and all of the detailed information about their location. You could easily figure out if it was going to be a good fit before even making a phone call and know if they had availability. Sounds amazing, right?! If anyone wants to run with that idea again go for it. 🙂
What I failed to realize and failed to do research on was if people would pay for this. Turns out they wouldn’t. I think if I would have stuck with it longer I could have maybe found a way to make it work but I was out of money. My parents loaned me $20K and I ultimately ended up spending over $50K to get that website created and working properly. I spent so much time and money on a business that no one would pay for. That was my crucial mistake on that business – not doing enough due diligence. I did a little research in the beginning and interviewed some childcare providers. They all said they would pay to have a listing, but when the time came where I said they needed to start paying to be on the website, they all backed out. I couldn’t get parents to pay either because then there weren’t enough listings on the site to make it worth their while. It was a little bit of a chicken and the egg problem. I needed buy in of both parties to make it work. Ultimately I decided I had invested enough into the business and I didn’t have proof that continuing would ever make me money. I never made $1 from that website. But I certainly learned a heck of a lot! I learned I needed to do a lot more due diligence before jumping into another business.
My first “successful” business – which for me meant I even made money at all, was an advertising business. When I was pregnant with my third child I decided this whole working for someone else dictating the hours I worked was just not going to work out anymore. I took a big leap of faith and decided to quit and start my own advertising agency called Chosen More. Again, I still didn’t do a lot of due diligence but my mindset was certainly in a good place. From the very beginning I told myself I wasn’t going to fail at this one. My start up costs weren’t too bad so I figured as long as I had a few clients this could work out financially. I hustled and found clients and ended up turning that business into a 6 figure income business after 3 years. The first year was very hard and I did almost quit after a year and go back to Corporate America. But I was able to work from home (I still sent my kids to daycare) with flexible hours. I didn’t have a boss micromanaging me or needing to approve my PTO. Along with my business I ended up creating a course to then teach others how to start their own advertising agency. They paid up front for the course materials and then I supported them along the way. What I didn’t realize at the time was that I had almost built a franchise. This is what I was doing before I became a franchise broker. I had over 20 clients where I was managing their ad accounts and I had my course as additional income.
Even though my third business was finally a success, I still didn’t really even do that much due diligence before getting into it. I could have easily failed at that business as well. When I became more educated about the franchise model I fell in love. When you start a business from scratch, all on your own, there are a lot of ways it can go wrong. It takes so long just to get things going. You have no idea what you’re doing and you always feel like there are a million things to get done or figure out. After year 1 I only had 5 clients. Just deciding simple things like what platform to create my website on or how to get a logo were a challenge. And if you didn’t do your due diligence beforehand, you could end up like me on my first two businesses with no money to show. With a franchise, so many things are done for you. For many franchises, after you’ve completed your initial training you can hit the ground running and start having customers that very first month in business.
In my opinion, due diligence is the most important part of the process when looking at franchises. As franchise brokers we have access to so many things that are very difficult or impossible to find with a Google search. We can see the history of a franchise, territories that are ideal for them to open in, the financial performance of their current franchisees, and so much more. We know what type of candidate they are looking for and who is going to be the best fit for their model. When you work with us, know that we are spending hours researching franchises and making sure that we are presenting the best options possible for your specific needs and wants. There are hundreds of great franchises in many different industries.
Once we introduce you to a few franchises is when the really fun part starts for you. You will do a lot of due diligence and validation calls. You’ll speak with current owners of the system and you’ll be able to get clarity on if that system is going to be a good fit for you. Before you even start your business you should have a good idea of worst case scenarios and best case scenarios. This really takes a lot of the stress out of starting a new business. Sure, it’s no guarantee, but neither is starting your own business. We want our candidates to feel excited and comfortable with their decision to buy a franchise. Or we want you to get clarity that maybe you’re not cut out to run a franchise. It definitely isn’t for everyone. You really do need to have the right mindset to run a franchise. You need to be positive and not a glass half empty type of person. With the right mindset and due diligence checking out, there’s a high success rate. I will always recommend a person go the franchise route rather than creating a business from scratch. Wondering what you’re even buying when you get into a franchise? Take a look at our blog post HERE to get more information on that.
While it wasn’t fun losing time and money with P3 Inventory and Second Pouch, I did learn a lot. I learned the importance of research, planning, having validation conversations and knowing how I was going to monetize my business. There was so much guessing going on and I learned so much about what it takes to run a business. If you’re interested in learning if a franchise would be a good fit for you and what even is available in your territory, please book a call with us HERE.