PayPal Stories Archive

 

As a Millennial small business owner, and friend of several others like myself, I’ve realized how hard it is to become financially healthy. You can only control certain aspects of running a business, and the rest is left to how the customer reacts. There are times of high growth, times where revenues are flat, and those not so great months that we can only learn from.

 

While all of us have to focus on sales at first, that full-time job usually gets passed to a sales representative as we grow. For example, I started WorkplaceTrends.com last year and was in charge of not only conducting all the research and producing content, but also selling membership. Then, after it was acquired, my focus has become more on relationship building, while letting our sales representative close deals. This made the most sense because I’m not a natural born sales person, and my strength lies in platform building and relationship management. Financial health is linked to the relationships you have with your customers and in our situation, it’s about annual membership and renewals of those memberships.

 

Some of the struggles we as Millennial small business owners face, include access to capital, securing a loyal customer base, and various fees including taxes, legal and overhead. We never learned how to run a business in school so we have to assemble mentors and advisors, as well as learn as we go. Getting access to capital can be very challenging, especially because only a small percentage of founders receive venture funding. Most of the funding comes from the entrepreneur and their family, which can be a huge burden on your health since you don’t want to let them down and put your relationships on the line. Then, when you actually raise money, you have to watch your burn rate as you start investing it in your business, which can be stressful because when you run out of it, your business is dead. When you receive funding, only spend money when it’s absolutely necessary, and don’t blow it on high rent, meals and marketing.

 

Securing a loyal customer base is key to financial health. If customers aren’t receiving enough of a return on an investment, they may leave, and your company will suffer. To keep your base strong, I recommend that you have multiple touch points with customers over the year, including emails, events, and catch-up calls. Starting a business comes at a high cost, and while technology has enabled all of us to start a business for less, there is still a cost on top of your time commitment. To save on legal and accounting fees, it’s helpful to ask your friends and family if they know of anyone who could help. Maintaining strong relationships with your lawyers and accountants can also help your bottom line.

 

Finally, it’s important to remember that all businesses will undoubtedly go through ups and downs. Inevitably, at some point in your business’s lifecycle, you may hit a bump in the road and face a spike or decline in sales. Instead of panicking, change your strategy. Consider finding new ways to service current customers and attract new prospects, automating part of the business, and cutting back on your expenses. Running a business involves a lot of learning and sometimes pivoting or changing strategy -- but don’t get discouraged! Managing through ups and downs are an inherent part of being a business owner.