Small Business Myths
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Small Biz Camp-Fire Stories
"You'll have more time for yourself and your family. Who needs a biz plan? Uncle Sam hands out startup grants, right?"
Story time is over as we explode the 10 most common small-biz myths and give you the facts you'll need to make smart startup decisions.
Next Slide: Generous Uncle SamMore From SmallBusiness:
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Myth 1
"The government has grants for startups."
The Real Story: The feds do not have any programs that lend money directly to businesses. Be skeptical of companies claiming they can help you get government money. You may find grants at the state level, but must meet very specific eligibility requirements.
Next Slide: Ole' MoneybagsMore From SmallBusiness:
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Myth #2
"The SBA loans money to small businesses."
The Real Story: The SBA does not lend money to businesses. As an independent agency of the executive branch of the federal government, the SBA is the guarantor of three different loan programs that directly benefit small-biz owners. Find out more.
Next Slide: Nothing VenturedMore From SmallBusiness:
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Myth #3
"Venture capitalists loan money to startups."
The Real Story: A great business idea is not enough to entice venture funding. VCs want companies that can show a detailed strategy in their biz plans, with strong growth potential and management teams, delivering a product with wide appeal.
Next Slide: Time Enough at LastMore From SmallBusiness:
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Myth #4
"I'll have more time to do what I want."
The Real Story: When you start your own business, time is the one thing you will sorely lack! To be successful, you have to embrace the concept that being an entrepreneur is a lifestyle, not a job. Prepare for immense demands on your time.
Next Slide: Just the Tax, Ma'amMore From SmallBusiness:
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Myth #5
"I'll be able to write everything off."
The Real Story: Not unless you want to get audited. The business expenses you incur should be clearly connected to the business you're running. For a write-off to count, ask yourself this question: "Is this an expense I would incur if I were not in business?"
Next Slide: "Cha-Ching!"More From SmallBusiness:
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Myth #6
"I can pay myself whatever I want."
The Real Story: If you take too large a portion of the money coming in, what will you have left to pay your expenses, like marketing and operations? Cash flow is key. Be prepared to not take any money out of your biz for one to two years.
Next Slide: If I Build It...More From SmallBusiness:
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Myth #7
"If I create a Web site, I'll get traffic."
The Real Story: Web traffic is based on several factors, all of which must be in place in order for the various search engines to find your site, and to attract the kind of customers you want to reach. Focus on search engine optimization. Find out more.
Next Slide: Not so FastMore From SmallBusiness:
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Myth #8
"I'll be profitable in six months, because I'm an expert at what I do."
The Real Story: Even if you're a pro at what you do, most new businesses don't see a profit for two to three years. It takes time -- and lots of reinvestment into the company -- before most new startups are on steady ground.
Next Slide: It Sells ItselfMore From SmallBusiness:
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Myth #9
"I don't need a marketing plan. This product/service sells itself."
The Real Story: Even if you think your product is the best thing since sliced bread, without a marketing plan or budget, you will fail. Marketing is an investment in your business. If you're doing it right, it pays for itself.
Next Slide: "Plan, Shman!"More From SmallBusiness:
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Myth #10
"If I'm not getting funding, I don't need a biz plan."
The Real Story: A business plan is the absolute first thing you need to work on. It gives you perspective and uncovers things you didn't even know you needed to know, which in turn helps you come up with solutions to potential startup problems.
Next Slide: More Startup AdviceMore From SmallBusiness:
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