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Don’t ever, ever, ever take a Merchant Capital Advance. Not only are they scummy, but if you even so much as hint at getting one, you’ll get calls from more and more “brokers” promising the world for months and it will deter you from being able to do any actual work.
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Identity theft is a problem - keep your credit frozen. I didn’t, and this seems to have led to someone trying (possibly successfully) to get loans or something against our business using our personal information.
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Never agree to any kind of financial transaction that involves personal liability of any kind. Corporate/LLC or nothing.
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Some people just suck. Even a preliminary background check outside of the usual checking services could save your bacon - my business partner hired a “friend” he’d “known for years”. Ended up walking out, but not before robbing us (criminal trial pending) and had been filing frivolous lawsuits for everything from sexual harassment with the EEOC (which we won) to absurd ramblings with no real complaint (but still needing our lawyers to respond). Turns out he did the same to the next guy he worked for too. A quick check of the state court system showed a pretty clear pattern of stupid shit, and I absolutely would have vetoed their hiring if only I’d looked there first instead of taking business partners word.
4a. Avoid hiring friends and/or family if at all possible. Friends especially. If things ever go pear-shaped with the business, that friendship is gone.
4b. Spending a few bucks on HR - even an external HR service or using a payroll providers HR service - totally worth it.
- Get as much insurance against everything you can think of as possible, and then try to find out if there is anything else you can get insurance for.
I’m in Telecoms.
Currently doing somewhere in the vicinity of -$50k/month, vs about ~+$130k/month in mid-2022.
The stark difference is due to a combination of factors:
A deal that went wrong (sold customers to a competitor, and they’re forcing us to litigate because they violated the terms of the sale contract).
A pivot away from an in-demand but highly problematic service (when it works, it’s great and profitable… when it breaks, it’s catastrophic and causes massive headaches, and we suffered some reputational blows).
Expanding the other parts of the business (which costs money while we bring them to the point of sustainability).
We have built an entirely new CRM/BMS/POS platform for ourselves and our customers - our old one was showing its age and limitations pretty badly. It created a small amount of conflict because the old system belongs to the partner, and he still thinks it’s the best thing since sliced bread (I - and our customers - disagree).
We’ve been slowly migrating customers to the new platform, and there are plans to license it out as an all-in-one solution for telecom resellers and retailers.
The only problem is project creep - it started out as an incredibly small thing, basically to track activations of SIM cards, but its grown substantially to cover just about every product & service we have available, and we’re thinking of new features to add pretty much every other day.
We took on our first debt ever, with good intentions, but I quickly realized it was a mistake and put a hold on what we needed the debt for because I couldn’t see a clear path to profitability for those particular endeavours.
My business partner has a little bit “given up”, and sometimes getting him to do what is needed is a challenge - sometimes it feels like he’ll do anything but - I’m actively seeking new partner(s) to buy him out.
The new system requires far less babysitting - so we found we were becoming a bit overstaffed. Unfortunately we did wind up terminating the employees who had the most complaints from customers for not doing their jobs, which was definitely my least favourite part about owning a business.
Am I worried? Of course - even the idea of spending more than I make horrifies me. But I built this thing from scratch before, and I could do it again if I had to.
Being a bit older also gives me some credibility in the field, which is helpful, and I’m pretty confident the new systems and getting rid of shit that wasn’t reliable will help us (me) win out in the end.