Starting a new business venture can be overwhelming. It’s like venturing into unknown waters. Most small business owners, fuelled to succeed, have to jump through hoops in a landscape that promises gains, alongside intimidating uncertainties.
We’ve created this article to help answer one simple question – just what are the risks and rewards that new business owners will encounter?
What are the risks of entrepreneurship?
There are quite a few risks for small business owners as they enter their new ventures. From financial risk to issues such as stress, there can be so much to think about. Lets have a quick look at some key issues:
Financial risk
New business owners will need to invest personal finances into the new business. Financial risk will arise here due to the uncertainty of early-days cash flow, alongside potential issues in loss and securing new funding. It can lead to enormous personal strain.
Market risk
New business owners will also face difficulty in predicting demand and ensuring they meet their customer’s needs. They need to stay relevant, but market shifts and competition can all threaten growth.
Regulatory and legal risk
One of the largest challenges to ensuring that all legal compliances are met. Legal risk can involve things such as business fines, potential lawsuits, and more – all of which can pose financial threats to your new business.
Reputation risk
It’s essential to maintain a positive public image. If reputation falls, and customers experience poor standards, the business will fail. A damaged reputation will lead to a loss of sales and increased difficulty in attracting any new investors.
Time and stress risk
As a new business owner, you will need to invest a lot of time. This means long hours, multitasking, and being under consistent pressure. Stress can affect personal well-being, and can lead to an early burnout.
Failure risk
There is always a risk of failure in business. Resources can be lost, self confidence can be damaged, and more. Overcoming failure is a must-need for new entrepreneurs.
Scaling risk
Finally, as a business grows, there will be challenges in maintaining quality – and often, challenges in securing additional funding. Combating this is essential
What are the rewards of entrepreneurship?
While a new business will have many risks, it will also offer rewards – which is why you want to start a business in the first place! Some of the most successful owners are those that have persisted over the longest period of time. Think Mark Zuckerberg – sticking to his plans made him one of the most financially successful people in America.
Let’s explore some of the rewards of entrepreneurship.
Personal fulfilment
New business owners will often find a lot of personal fulfilment in turning their ideas and passions into reality. There is an enormous sense of accomplishment that comes with succeeding in business.
Flexibility and autonomy
New business owners will have the freedom to set their own schedules and work environment. This can help with setting the stage for a good work-life balance, and allow you to tailor the business to your own personal needs.
Leadership experience
Running a business provides valuable leadership opportunities. New owners will develop skills like team-management and more, which can be incredibly satisfying – and transferable to other areas!
Control over direction
New business owners are also able to shape their business’ vision and ideals. This direction will let them innovate and succeed in gaining their personal aspirations.
Recognition and legacy
Building a successful business can lead to recognition from peers – whether they’re within the industry; they’re old friends; or they’re from across the world! You can easily leave a legacy by contributing to the economy.
Innovation and creativity
New businesses require positive creating thinking. You will be able to be as creative as you want to be; managing new products, new services, and more!
Job creation
You will also play a huge role in creating employment opportunities. By hiring new employees, you are contributing to local economies and ensuring the livelihoods of those individuals are improved.
Get started with our forecasting software so that you can plan your business' future
Plan your business with Brixx
How can Brixx help entrepreneurs with their business?
Getting started is often the hardest thing to do when it comes down to creating a new business venture. Whether it’s thinking about the planning, or the finances, or even what the next steps might be, there are often so many blockers that most can’t overcome!
Brxx is here to help you on your journey. It easily simplifies the process of forecasting for small businesses. It can create projects, project income, and more. There are so many tools and features that can help you.
Our friendly and easy-to-use financial forecasting software is there to help handle all complex financial aspects. Get started for free today and feel confident about your finances.
