New Jersey Entrepreneur

The common expression “Money Changes Everything” may particularly apply to Entrepreneurship. As an Entrepreneur you will experience the changes associated with less money and more money.

In virtually all cases of starting a business you will feel the pain of having less money available to you than you are accustomed -----and in some startups the financial pain of waiting for your business to turn the corner may become quite high. Once the business becomes successful you may experience a surge of income and wealth that you may never have expected. Those associated with the startup of Microsoft and Google have achieved lifestyles that they could never have imagined.

Whether it is too much money or too little money, the difference will impact you and change some, if not virtually all of your relationships. Be prepared to see different reactions by family and friends depending upon which stage you are in. .

At the outset of the business when usually there is no predictable income, little things such as fewer trips out to dinner or giving up the Spring vacation are required, but for some the startup phase may require eating a lot more bologna sandwiches and possibly borrowing from relatives. As you make this change to a scaled down lifestyle, your friends who have paying jobs will still want to go to the ”A” restaurant, but during those startup years they may see you there less often. For some people who understand the challenge you have chosen to undertake, you may see the tab for a couple of dinners quietly picked up as a sign of support, while others may simply stop calling you since they will feel uncomfortable. In fact, you will start changing your behavior as your budget becomes tight. For instance, splitting the bill equally among your dinner companions is very common, but you may be inclined for the first time to ask to just cover your toned down share. Others will take note of this. Money changes everything.

Borrowing from family is a real Pandora?s box as family values with regard to money come to the forefront when you realize they are expecting interest on the loan or some grand payoff in return. You thought it would an interest free loan and that they would not care since they have luxury automobiles in their driveway. You learn otherwise. Borrowing money requires a lot of more planning and discussion than the casual approach of deciding who should leave the tip after a night out. As you seek outside support you will learn about the risk others around you are willing to take and you will become much more aware of the quirks of your family and friends, as well as your own. This may make you and them uncomfortable. Money changes everything.

It is amazing how those you thought would lend you money won?t and those that you thought would never are front and center.. This was never something you had to think about until you became an entrepreneur. Money changes everything.

When I initiated the column Learn From Experience in our Newsletter where entrepreneurs related their experiences in starting a business, almost everyone referred to the support of family during this difficult period---many specifically mentioned how they were forced to borrow money because the time it took for the business to pay off was much longer than they thought.  I interviewed those entrepreneurs whose businesses were successful after five years and now wonder whether the feelings of those entrepreneurs whose business failed are different than those who succeeded when it came to paying back family loans? Are there hard feelings paying back loans to family when they know you are working through a business failure? Was this scenario thought about before taking the loan and the possibility of failure discussed?

The opposite of little money is the abundance of money once a business pays off. A large payoff to an entrepreneur may immediately mean a luxury car, boat or larger home. So success may change you, as well as the people around you. In fact, many of the people who were cheering you on when you were the down and out entrepreneur, may not be that comfortable with the new successful you. This may surprise you, since you thought they were rooting for your success. They themselves may not have predicted their own reaction as they began to see your new toys and watched your move to another town and larger home. I picked up another entrepreneur?s perspective on this issue at a forum and he just simply called it what it is “jealousy”. Be prepared for your success. Money changes Everything.

Jeanne Gray is founder of Enterprising Solutions Inc., a consulting firm specializing in growth strategies for small and entrepreneurial stage businesses. She is also the publisher of NJEntrepreneur.com.  Jeanne may be contacted at jgray@NJEntrepreneur.com or by calling 908-917-9900.