Five Mindset Mistakes Entrepreneurs Must Avoid!Chia-Li Chien
It’s all in the mind.
Chia-Li Chien | April 5 2011
Why are you in business? There are three general categories we have heard from thousands of entrepreneurs. Entrepreneurs are in business because of 1) their passion 2) desire for flexibility and 3) according to our poll, 67% of entrepreneurs are in business because they want to make more money and become financially independent.
However, according to the Small Business Administration, less than 5% of small businesses have more than $1 million in annual revenue. Very few actually build any wealth or value from their businesses either. There are so many factors can make or break a business. Ultimately, it’s all in the mind of the entrepreneur.
Eric Sbarge started the Peaceful Dragon with his wife Debra in 1997. Their mission is “to enhance the lives of our students and members of our community by teaching traditional and authentic Chinese health and martial arts, and supporting the marriage of Eastern and Western approaches to health and well-being.” Sbarge was a high school teacher when he first started running his business on a part-time basis, until the revenue became enough to support the family. During the first ten years, Eric did not take much salary from the business. He then took a leap of faith in 2004 to work with an industry marketing expert, and in 2006 worked with me toward value creation. Today The Peaceful Dragon ranks in the top 1% in its industry and was featured in Martial Arts Professional Magazine April 2008.
“It’s all in your mind,” says Sbarge, sharing the five mindset mistakes he feels entrepreneurs must avoid:
- Not having a millionaire entity mindset. Many people want to be a millionaire and many want their businesses want to break through the million-dollar revenue mark. Yet not many people want to build their entity as a millionaire. Your business equity value is not the same as your revenue. Unless you intentionally build your business to fair market value of a million dollars, it will never happen.
- Not having a mentor from your own industry. An entrepreneurial mentor is a person who has successfully been through the start-up and exit phases of a business. This person can help can guide you through the years it takes to become a success. Sbarge has been working with an industry mentor since 2004.
- Having no consistent marketing process. Most B2C businesses rely on both on-line and traditional advertising. But most don’t have a plan or process and consistently stick with it. Sbarge developed his own marketing process internally and set an annual budget and performance monitoring of all marketing activities. He has marketed consistently for many years.
- Not having a mentor outside of your industry. The best entrepreneurs learn from the best entrepreneurs. What we learn from each other is not something you can learn from an MBA program. A mentor who is successful in business is equipped in ways an academic program can’t replicate, such as real life experience. Sbarge has two mentors outside his industry.
- Not building any value from your business. In addition to growing his business consistently, Sbarge has carefully built additional value inside and outside the business. They own their own building and just acquired property to build a retreat center. Growing in revenue alone is not enough to create necessary value from business.
You don’t have to do everything alone! The value of having the right mentors or advisors will greatly enhance the value of your business. It’s really all in your mind – “Do you want your business to be a millionaire?”