Often, when we decide to go into business for ourselves, we don’t ask ourselves what type of business we want. I’m not talking about the services you plan to offer or the industry you plan to operate within. Rather, I’m talking about the size and scope of the business
There are three main types of businesses and it’s crucial you decide what you’re designing before you begin:
2. Small Business
3. Entrepreneurial Empire
Let’s look at each of these in more detail to help you decide which one is the best fit for you.
Sometimes this is referred to as being a solo professional, a freelancer, or an independent contractor. In this type of business you’re basically designing your own job. In recent years, many people have criticized this type of business saying it’s not really a business. I disagree. It’s a perfectly legitimate form of business. It’s also the one chosen most frequently by service professionals when they’re getting started.
If there’s something you’re good at, enjoy doing, and your goal is simply more freedom and flexibility than working for someone else provides, this can be a good choice.
As a solo professional, you know you’ll be doing the work and that’s okay. You just want to be able to call the shots, and choose when, how, and with whom you work.
You are clear you have no desire to manage a big team of people, and you’d like to keep your business small, at least in terms of moving parts. It certainly doesn’t mean your business has to stay small in terms of income.
A small business is more than just you doing your thing. As the business owner, you are running the show, and while you may be doing some of the work, you also have employees, or independent contractors, doing the work, too.
A small business requires organization and structure. Other people are depending on you. It means you must not only be good at what you do, you must also be a good manager and leader.
This is the type of business Michael Gerber talks about his book, “The E-Myth.” It’s an enterprise where as the business owner you should be spending more time working on the business than in it.
A small business requires systems and collaboration. This is definitely not an individual endeavor, it’s a team approach and you are the team leader.
The third type of business is typically born out of a big idea or invention. It requires out-of-the-box thinking. It’s often revolutionary. It usually requires seed capital—potentially even outside investors.
The empire owner must be a true leader. She’s not afraid to take risks and step into uncharted territory.
This type of business owner thinks big. She’s not afraid to invest time and money into her big idea because she believes in it.
An empire can take time to build. It’s not for the weak at heart. It’s for the determined, the strong, and the tenacious.
Choosing the Best Fit For You
As a business owner, there is no one right path you must take. None of these types of businesses are better than the others. The key is choosing the one that’s the best fit for you.
The choices you make as you’re designing your business, and your day-to-day decisions in the business are all driven by the type of business you’re building. If you’re unclear about what you’re creating you won’t know what to say “yes” to and what to say “no” to.
The key is to do what makes you happy and supports the lifestyle you want to create. And to know that at any time you can make the decision to step into a different type of business if your goals change.