How To Start a Business as Mission (BAM)

1. Determine if You Have the Time and Skills to be an Entrepreneur

Entrepreneurs are able to first see a need and then design products/services to meet this need. Starting a business usually requires between 40-60 hours a week, so they must be high-energy and passionate about the business. An entrepreneur must be able to quickly gather information and take decisions and must be able to tolerate a high degree of uncertainty. They must be able to plan, but also to quickly change directions, and use a high degree of creativity. Entrepreneurs are also able to solve issues with limited resources. Many small businesses are started by two to three friends with a similar vision but complementary talents. Business teams can be very successful but expectations for time, effort, cash and work contributed by each partner need to be clearly written out.

2. Determine if This is the Right Time to be an Entrepreneur

Starting a business takes a lot of hard work, and is high risk and high stress. Each entrepreneur needs to determine if family or other commitments will allow him/her to start the business at this point in time. Generally, home businesses take 6-12 months to become profitable and small businesses 2-3 years to become profitable. The entrepreneur needs to determine if he/she has enough personal savings to cover the family's needs during the start-up phase.

3. Identify how Business and Ministry Overlap

If ministry objectives cannot be achieved through the everyday activities of the business, the business will fail. The Bible is clear that man cannot serve two masters and this applies to business and ministry.

If you do not believe that the business is your ministry, you should not start a business.

4. Brainstorm Business Ideas

Begin by creating a list of what you are passionate about. This could include hobbies, sports, products, or industries. Then create a list of what you are good at and what you have experience doing. Review and rank these interests from what you do best (or have the most experienced) to what you are less interested (or experienced).

Many people think you need to create a new product/service but most businesses are started to improve on an existing service or to fill a gap. Create a list of unmet needs in the community. What is your community lacking? What product/service could be better? What trends are you seeing in your community? Write down every idea you have, no matter how silly or big it is. Then review the list and rank from easy to hard to solve.

Now, compare the two ranked lists. Starting at the top, are there areas of overlap between the two? Can you see where your passion, skills and the community's needs overlap? Circle the top 3-5 ideas. Take the top ranked business and ask trusted family members and friends for their opinion on which business you would be best suited to start and operate.

What are you passionate about? What does the community need? Come up with 3-5 ideas.

5. Investigate Business Ideas

Take your top ideas and begin researching if similar products/services exist in your community. Who is offering them? What is the pricing? Who is buying the product/service? How much and how often are they buying? Is it easy to switch to a competitor? Why would anyone switch to your product? What makes you different? Ask these same questions to your target customer. Create a short description of the market for each product. If there are no competitors or alternatives, is there really a need for this product? How can you tell?

The ideal market is large, with some competition but not crowded. Keep in mind it can be hard to compete on price, especially against larger, established businesses. After reviewing the competition, rank the business ideas based on market attractiveness.

"Character is the most important attribute"

6. Find a Mentor

Successful entrepreneurs often cite experienced mentors as their most important resource. The best mentors have business experience, know the local conditions and can be direct and honest with the entrepreneur. Character is the most important attribute when looking for a mentor. You can find mentors using family connections, a pastor or other community leader. When asking for help, you need to be clear about how often you would like to meet with the mentor, the length of the commitment and how the mentor can help you. Sometimes you may need to approach several people to find one who has the time to help you.

7. Write a Plan

A business plan is critical because it helps the entrepreneur to think through the business model, understand the finances and will help raise start-up funds. Business plans provide a target, but entrepreneurs understand that markets change, businesses change and so plans are updated on a regular basis. Investors want to see that the entrepreneur understands the local market, competition, and target customer. They also want to see that the business model including pricing, promotions, and hiring have been thought through. Finally, investors want to see financial projections and to understand how the entrepreneur has developed the sales projections. Well written plans often include "best case" and "worst case" financial projections.

8. Raise Funds

Generally banks do not loan money to start-ups without the entrepreneur pledging an asset such as a car, land or home and small businesses are often funded through the 3F's: family, friends and fools. Most investors, including the 3F's, want to see proof that your business idea will work. One option is to fund the initial start-up via savings and then grow the business using the profits until the idea is proven. When determining your capital needs, do not forget to include working capital, the money needed to pay bills before customers have purchased your goods.

9. Secure the Legal Permits

Confirm that your business model does not violate any laws. Then register your business with the appropriate government agencies to ensure you are following all the local rules for tax, manpower, reporting, etc.

10. Begin Marketing Your Business

Marketing includes having a product which is in demand at the price customers are willing to pay and where customers know to buy it. Location is very important for some businesses such as: cafes, schools, clothing shops and car washes. Many entrepreneurs under-price their products with the idea they can raise prices quickly as demand grows, but this strategy rarely works. Use social media, word of mouth, family and friends to launch and promote the business

11. Document the System for Running Your Business

Most entrepreneurs start a business with the dream of eventually turning the everyday management over to the staff and starting a new business, ministry or spending more time with family. However, if the business has no policies or procedures, the staff will not know how to operate the business and the entrepreneur will never be able to reduce his/her hours. Standard procedures keep customers happy and by treating customers well you ensure they continue to be customers for many years.

12. Hire and Train Employees

Hiring the right people, at the right time is essential to success. Many small businesses are staffed with part-time labor until the business is large enough to support full-time workers. As a Kingdom business, it is critical that the staff agree to abide by Christian ethics, even if they are not believers. Investing the time in training your staff is initially very time consuming, but over time it will pay dividends as they learn to implement the system.

13. Launch the Business

Starting a business is a long process and the launch is an opportunity for you to publically thank God for providing the idea, resources and ability to open a business. Inviting the public to join in this thank you ceremony is a great way to communicate your values to your staff and the community.

14. Manage the Business

Always be prepared for difficulties and try to think through solutions before problems arise. Develop and review sales and financial targets on a monthly basis and ask your employees to help develop ways to improve the business. Finally, ensure that policies, procedures, and controls are being followed to reduce the risk of business failure.

How To...