How to Start a Business Correctly


Experienced entrepreneur at age 27, the American Scott Gerber became an oracle for young people who want to start a business. For him, it is dangerous to be original in the early years.

American Scott Gerber set up his first business at age 20, while studying film at New York University. It was a small producer of videos that he decided to turn into a sophisticated multimedia company to do anything for anyone. Everything you can imagine went wrong. Gerber chose a name for the company so difficult to pronounce that to this day he is ashamed to tell what it was. Business cards were illegible. The first customer never paid, and that default left the business deeply in debt.

The four employees hired were laid off in less than two weeks because there was no money. For lack of a convincing proposal, Gerber lost accounts to a competitor who then subcontracted to do the same services for a lower value. At this point, you should already imagine the end: yes, the deal closed in less than a year. There was $ 700, with which he set up his second and successful venture, called Sizzle It! to produce videos they can surprise consumers in three to five minutes. Early failures experience also allowed Gerber is currently a prestigious expert in entrepreneurship.

Writes columns for vehicles as Entrepreneur, Inc. and Wall Street Journal, founded an NGO called Young Entrepreneur Council to help young people to take over the world and has just launched a very useful book to those who want to start a company, Never Get a Real Job. At 27, his counsel have echoed for two reasons: it is not the kind that hides information and not like half-words. “What I learned and still learning I tell others,” he says in this interview with Small Business & Big Business.

How to properly start a business?

The key is to ensure that your idea is able to generate cash immediately. I would not bet on grandiose sites or any kind of product. If this is your first business, you should avoid complex projects and make the most of entry barriers. It is best to start with services, grow, and then yes virtualization, diversify into new markets.

But it’s easy to find a market that pays off right away?

Is not difficult. The problem is that people want to make money quickly and this causes end up investing in the wrong kind of business. You have to think small and simplify. Instead of investing thousands of dollars in a restaurant, for example, start the house to operate only with an overnight delivery system for your neighbors or a nearby college. Be sure, too, that is not being original. Not original business have been proven, have shown that managed to make money in the past and can be quite profitable. A first-time entrepreneur should not think that has to change the world and do something that is totally new and innovative. When you try to reinvent the wheel is that it runs the risk of giving wrong. It’s not always possible for people to quit their full-time job in order to start a business, but this doesn’t mean you can’t get started by using your spare time. Check out for business knowledge.

There is something common in successful business models?

Great they are those in which you define a job and earn money just before or after running it. I also like the models that you can charge a subscription: it gives a box of consistency. Businesses that allow people to easily recommend and talk about your brand – and perhaps to be paid for it – are interesting. In short, the easier you make your customers buy from you, the better your business model.

You have to like the market where starting a business?

I believe that you should only be in love with their rational ideas. Because if you let passion blind and think that your idea is brilliant, probably will struggle to achieve success. Of course, you have to love what you do, but you should consider whether what you love is actually able to generate value. If so, great. If not, re-evaluate what they could do to modify your model. If still there is no alternative, change your mind completely.

If one realizes that there is nothing to give to a specific need, you should bet on a deal to supply it?

First you need to search for something that does not yet exist. Ultimately, who’s invented a flashlight that can only be loaded and used under the sunlight? Not because there should exist. You have to wonder if there really is a need there. The best way to do this is to ask potential consumers: would you buy it if I created?

What is the best way to get an idea, in fact, the market?

You do it quickly. Today, available on the internet a lot of free services to help anyone start a business. What does not is to get stuck in an endless analysis. You do not make money on plan but to execute your plan. I personally am not in favor of entrepreneurs write a business plan the size of a phone book. So, I created what I call “the start-up plan of a paragraph.”

And what comes to be the plan of a paragraph?

First, write a few sentences what to do, how you differentiate themselves from competitors and how you will reach your customers with the resources you have. These are the key issues on which you have to think and direct your plan. I took three days to research, think and write mine. It was not easy, but on the fourth day I was putting into practice my ideas. The paragraph is only the beginning. Then you need to turn every sentence of it in five possible steps to be performed immediately. Run them and see what worked and what needs to be eliminated or improved. I did it with my current business and realized that my initial assumptions were false. I had not considered just between my clients those with the greatest potential. Go repeating this process and creating new checklists until finally able to prove its premises.

To win the first contract or customer, the entrepreneur should offer the product or service even for free?

I do not recommend never give something for free, unless you really believe that this customer will return a lot and is an important market reference. Close a deal at any cost will take your time and be costly. So do not, show your value. It is best to find out what is going on in a negotiation where you feel at a disadvantage. Find out why the customer is not likely to hire you. And try to mitigate the risk that he prefers you to competitors.

How to find the best suppliers?

People sometimes think that there is a magic button that will tighten and where will come out answers to questions like this. But in reality, it’s simpler than that: go to Google and type in what you are wanting. You will find the most opportunities, information and people you need simply a search engine on the Internet.

What it takes to avoid failure in the early years of a company?

You cannot be a smug face when starting a business. Entrepreneurship in the end is rational and know what is required to be successful – and not just say it will be successful. There are many people who believe you need to build the next Facebook and there are not many people who trust that they can build a profitable small business. Second, you have to realize soon if something is not working and, if it believes it can work, change direction. Third, automate and delegate tasks that are not related to generate income, for example, pay the bills and take care of the accounting. Fourth, constantly check their expectations for sales, marketing and business growth. Finally, try to have mentors, people who know what you do not know.

How did you learn all this, being so young?

I started making money with my first business when he was in college, and then I became a complete moron. Thought could grow at a much higher speed than, in fact, could. After this bad experience, I decided to kill my ego and now my second company has clients such as Procter & Gamble. At the time, failure was terrible. But, deep down, it was the best money I had and I could not find another way to invest in my next attempt. And do not get me wrong. I still learn every day, I make mistakes and I often struggle to find my place in the market. And what I learn I tell others.