START FAST! | 4 RULES to KILL IT in Biz

When the going gets tough, start your own business. It's one strategy for economic survival in economic downturns. But when the times are this tough all over, will there be anyone out there to buy what you have to sell? Evan Carmichael is an entrepreneurial expert who writes extensively on how to start up a business, and he joins us now to talk about taking the plunge. So now, Evan, this recent economic downturn The downturn, of course, has got everybody pretty worried about things. What have you observed in the entrepreneurial world? Any changes that you've seen?

I've seen a huge spike in entrepreneurship, and it's coming from two main sources. The first are people who've been laid off. They can't find any other work. They start their own business as a means of survival. It's the only thing they can do. The second group are people who have put their life stake into these corporations and thought they had a nice cushy job. For the rest of their lives and realize that it's not as stable as they thought it would be. And now they want to take their own destiny, take life into their own hands, and they started their own business to be the masters of their own fate.

Right, so you're actually seeing that more people are starting businesses at this difficult time than they were, say, previously when the economy was a little more stable?

Huge rise, huge rise in entrepreneurship.

Well, that's good, because as you know, NewsWorld is launching the show, this other show I host, Fortune Hunters, this weekend, and it's all about you know, people starting out businesses, what are the hot trends, how do you do that? And I have to say, you know, we pitched the show at a time when the economy was better, and now that everything's going so difficult, I'm thinking, is this really still a great time to have a show on the air that's about how to start a business? Who the heck's doing it? But you're telling me that's okay.

I think you'll see a nice spike in ratings for the show.

I hope so. Well, are there any advantages for small business people in a downturn, say, as compared to people involved in larger corporations?

Yeah, I think entrepreneurs will do better than most in this coming economy. A couple reasons compared to big corporations. The first is they're more agile. So as a small business owner, you can make a decision right away to reflect whatever changes you've seen in the market, whereas corporations have board meetings and multiple levels of decision-making. They have a lot more infrastructure, so it's harder to get those quick decisions out. So it's a time to be nimble and a time for entrepreneurship.

But it's very difficult right now to borrow any money, and of course one of the biggest reasons small companies go under is they're undercapitalized. They don't have enough money to sort of stick with it until they can make a profit. So isn't it a little more difficult to start a company when you can't borrow as easily?

A big thing for entrepreneurs now is they're starting service-based businesses, so they don't need as much money to start up. There's low overhead, so they're getting the services where it's just their time, as opposed to being able to take out a big loan, which is not available from the banks right now.

All right, so now I understand you have some tips for people who do want to start their own companies. What are those tips?

The first one is start a business with as little money as possible. So don't go spending your life savings, you're draining your bank account to get your company off the ground. Start it with as little money as you can. The second is start that service-based business. So again, it's a lot easier to start a service-based business, go out, find customers, start bringing money in before investing into products. The number one reason why entrepreneurs fail is that they don't— they run out of money. So it's not that they don't have a good idea, it's that they run out of money too quickly. So start that service-based business. The third is be passionate. Love what you do. You gotta love what you do if you're an entrepreneur. There's going to be so many stumbling blocks that you'll face along the way. You have to really love what you do. And the last is really know your market. So don't get into an industry just because you see that it's, it's a hot industry and the trends are going up in that industry. Make sure you really know what that business is all about before you get into it.

Alright, well thank you very much, Evan Carmichael.

No problem, thank you.

Nice to see you.