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Hello Longmont!
I am a dad, carpenter, writer, and retired software engineer who has been living in Longmont since 2005. I used a few simple but powerful life principles to become wealthy enough to retire at age 30, and went on to start a blog called Mr. Money Mustache that has now reached over 30 million people in the past nine years. Now it’s time to take these ideas to the streets of Longmont, so send in your questions about money and life!
Dear MMM,
This has been a very unique summer and year which left many people with lots of time in self-isolation to come up with a new business idea or build a cool new knick knack to sell, etc.
At the same time we're seeing businesses on Main Street going out of business and many would say this is a really bad time to start a new business. For people in our community who have that new business idea or the hot next product to sell, how can they do this without going into debt?
Business schools always teach that it takes money to make money, what are your thoughts on that and how can people in our community start their own business or sell their new product without going into debt?
-James Lissy
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First of all, I’m a big fan of your own new column about gardening here in the Leader, and thanks for your question.
When it comes to starting a business, there is never really a bad time - as long as you get started in the right way. And that way is to do it incrementally, focusing on sales and profits first, rather than the usual approach which is to immediately go into debt and/or lock in a fixed cost like leasing a retail space, before you even get started.
This approach is simple but also very powerful, as it helps you refine your skills in serving customers, iron out the kinks and even change fields entirely if you realize a business model is not quite right for you. All with far less stress and more chance of success because you won’t run into cashflow problems.
One quick example from real life:
A talented chef in England wanted to start his own restaurant. But instead of renting a $3000 per month space immediately, he inquired with an existing restaurant, which happened to be closed on Mondays, if he could rent their patio space for a special one-night event. They said they would be willing, for just $200.
Next, he designed a menu and printed flyers and advertised it for free using his own Facebook, Twitter and Instagram accounts - selling tickets online for a fine five-course dinner. He was able to sell out the event in advance.
Only at this point, he locked in the rental, bought the ingredients, hired some help, and hosted the event.
It was a big success, with glowing feedback from his guests, who went on to recommend it to their friends. So he tried it again, and it worked again. It became a recurring weekly event which was very popular.
At this point, with a growing base of raving fans and thousands of dollars of profits saved, he was ready to consider taking the next step and renting his own space. Or perhaps converting an old vehicle or trailer into a food truck.
This example comes from a free event called Pop Up Business School which I helped to host here in Longmont in 2017 and 2018, and it now runs in several countries as well thanks to the amazing group that started it. They teach this better approach to business in very enjoyable detail, you can learn more about their work at https://www.popupbusinessschool.co.uk/
