Entrepreneurs must take risks5 min read . Updated: 31 Jan 2011, 11:20 PM IST
Entrepreneurs must take risks
Entrepreneurs must take risks
My 12-year-old has often tried to launch little businesses, but he becomes frustrated when he fails. He tried making and selling wallets. Then he tried selling his artwork. He also set up a lawn-mowing service, but his mom and dad were his only customers. I want him to continue to pursue his ideas, but I don’t know how to help him succeed. Any suggestions? -Debbie Mitchell, Texas
First of all, your son shouldn’t be disheartened—with all his restless activity, he is off to a good start. Indeed, he has achieved the first step, which is just to turn up and try. And he is showing good instincts. One of my golden rules for myself and the Virgin Group. In any business you decide to launch, your product or service should enhance customers’ lives. His lawn-mowing service certainly passes the test.
Tell him not to be discouraged. Entrepreneurs must take risks when starting new ventures, and most enterprises do not work the first time around. Now he needs to take the second step, which is to learn from his mistakes and ensure he does not repeat them on his next try.
My own initial schoolboy attempts at setting up businesses were about as successful as your son’s. As a teenager I tried my hand at a few ventures, hoping to earn money and kick-start my business career. Two stand out because of the suddenness of their demise. When I was 13 years old, I tried to grow Christmas trees in a field near my home in Sussex, England, with the help of my best friend, Nik Powell, who later became my business partner. We thought they would grow quickly and would be ready for harvest less than two years later. Over the spring break we planted 400 seedlings, then went back to boarding school and waited for our fortune to grow. We had worked out that if the trees grew to 6ft tall, we could sell them for £2 each, generating £800 in profit from our initial £5 investment. But when we returned home that summer, we found that rabbits had eaten all the saplings and our plans were ruined.
My next venture involved breeding budgerigars (a small Australian parrot), as I knew that they bred quickly and I could sell them year round. I calculated how much they would cost to buy, what their food cost and how much I could sell them for, then persuaded my father to build a huge aviary. The birds multiplied, and soon everyone in the village had at least two. I returned to school after the holidays, leaving my parents with the task of feeding and tending to my growing stock of birds.
One day I received a letter from my mother in which she explained that rats had gotten into the cage and eaten all my birds. It was only years later that she admitted she had left the cage open, as she was fed up with cleaning out the cage! Those stories may be comical but, looking back, it’s clear I did learn a lot from those experiences. When I started up Student magazine at 16, I knew which pitfalls to look out for. Before we started production, I made sure we had sold enough advertisements to cover our paper and printing costs. Though we were a shoestring operation (our office phone was a nearby phone booth) I was secure in the knowledge that any magazine sales would go towards paying my staff—maybe even making a profit!
So it is important that your son keeps trying. He is on the right track with the lawn-mowing business. It is a service many people want and are happy to pay for.
Together, the two of you should take a second look at a few key factors and see if a tweak or two might kick-start Mitchell’s Gardening Services (or any venture started up by a child):
•Is the pricing right? Are you charging too much? What do other kids charge? How about landscaping companies?
•If you are unsure what to charge, you might try the radical approach: Offer to mow people’s lawns for free and tell them that if they are happy with your work, they can pay whatever amount they think is appropriate. You never know—you may end up making more money than you expected.
•Is the equipment up-to-date? Maybe you need to invest in a better lawnmower to help your son woo customers—perhaps people in your neighbourhood want the option of composting the clippings, or they want leaves mulched. It is amazing how a loan from one’s family will focus an entrepreneur’s mind.
•Do some research to find your most likely customers. If Mr Smith next door has just hurt his knee skiing, he might love to have someone do his mowing. Are there other people nearby who might need help, for any reason? Elderly neighbours, or a couple with a new baby, or someone about to go on vacation?
•Can you broaden the services you offer? Some people like to mow lawns themselves—could you also offer to weed gardens, clean cars or remove trash? If your son demonstrates that he is reliable and works hard, people may sign up for more than one service.
•Offer to donate some of your proceeds to a local charity. That may help you persuade people to try out your services, since you will also be doing some good for the community.
Finally, here’s a tip that has always helped me: Look for some element of fun to sell your services. Learn a song, tell a few jokes and, above all, smile while you work. It is amazing what you can achieve with a little humour.
BY NYT SYNDICATE
© 2011 Richard Branson
Richard Branson is the founder of the Virgin Group and companies such as Virgin Atlantic, Virgin America, Virgin Mobile and Virgin Active. He maintains a blog at www.virgin.com/richard-branson/blog. You can follow him on Twitter at twitter.com/richardbranson
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