Semi-Bi-Annually-Sesquicentinial Business Update

I just posted about re-discovering this old blog. Now I want to give an update on the business.

We celebrated our 5th year in business this past Summer. We made it past the dreaded "BIG PERCENTAGE NUMBER of businesses fail within 5 years" pitfall. Have you seen stats on businesses that cease to exist between 5-10 years? Kinda scary too.

We own our Google rankings for our market, all organic search rankings, no paid ads.

We have competition, and are doing well.

We won two awards this year in a local "Best of Little Rock" poll for music studio and birthday party location.

We have 10 teachers, 1 employee, a instrument repair shops and my wife is in the process of leaving her part time job (kept for health benefits) to help run the business full time. (Now that's scary!)

We incorporated this year (self employment taxes ate our lunch for 2010) and hope to see tax benefits from that.

I still clean the bathrooms and am amazed how clean the women's room stays day after day while us filthy beasts (men) are able to destroy the bathroom day after day. (goal for 2012 - hire a cleaning service).

I still love what I do, play guitar a lot and am able to spend quality time with the family.

Life is good!

That's all I've got right now. Bounce a few ideas off me for articles and I'll see what I can do.

Lost Blog Alert ...

Time flies!

This blog is a side project to discuss my thoughts on small business, specifically, running/owning your own business.

Have you heard the phrase "out of sight, out of mind"? That's what happened here.

This fun "side project" was overlooked for a while as I focused on the business. Then it was forgotten. I did remember from time to time, especially when I find gum in the men's urinals.

This morning, I received an email from an old website that tracked this blog. It was like finding a $5 dollar bill in last years winter coat. SCORE! I can't believe two years have passed since my last post.

If anyone stumbles across this blog, I can't guarantee there will be a steady stream of posts going forward. But I will drop one from time to time!

Second opinion on starting your small business

So, the other day, I wrote about my first opinion on starting your own business, namely, being passionate about what you want to do.

Today, I'll let you know what I believe to be a crucial element to success when starting a small business...

You need to have your financial affairs in order and have sufficient capital to start and sustain your business until the revenue kicks in.

As you know, I took a buyout offer from at&t that provided a nice lump sum payment to leave the company in 2005. However, at that time, we were in a situation where both our vehicles were paid off, as was our house. Yep, no car payments and no house payments.

This is one of the reasons my wife agreed to letting me live my start-up dreams. Had we a house note and/or a car payment or two, I myself would have likely passed on the buyout offer.

After all, it would not seem likely that we could pay a mortgage note and a lease note on a retail space, as well as a car note or two, along with double utilities, double insurance, sign costs, advertising and all the other various expenditures. I'm sure some have scrapped by on that dual road, but I don't think I would have risked my wife and kids financial well being to do so.

Now, I'll agree that I did have what some would call a "silver spoon" by not having a car note or house note when I started my business. Without either, the buyout money was more than enough to give me $40k of start-up capital and have a nice fat savings account to live on while the business grew.

However, I still had to manage my start-up budget with lease requirements (first/last months rent and security deposit), signage, utilities and deposits, insurance, advertising, furnishings, office equipment, music gear, etc., etc., etc.

There were several opportunities where I could have spent too much on getting better PC's for the studio ($500 more each), more expensive paint/carpet, furniture from Dillard's rather than Ashley's, a crazy big LED sign rather than a plain lettered sign and so forth. By being responsible in my initial build out, I had the funds to keep me debt free for 12 months, before I would have to hit the savings account.

(BTW - I became profitable 3 months after opening, beating my business plan by 4 months)

Now, if you are looking at a home-based small business, you have instant savings in that you will not have a second lease payment, less fuel costs by not having to drive to-from work, maybe some utility savings, insurance, as well as some tax write offs for your home office. This is more manageable than having a brick and mortar business.

If your business requires a retail/warehouse location, my advice is to have minimal to zero debt (credit cards especially). I know, easier said than done, right?

Well, If you have car notes and a house payment, try to knock the car notes out and drive an older car for several years (they last if you take care of them). Use the savings from the car notes to build your start up capital. Start planning your budget and how long it will take you to get to that dollar amount.

Then - work at saving the money - or if possible, take a buyout like I did for a little head start!

I'll talk soon about that first budget. Whatever you come up with, even with some extra thrown in just in case you overlooked anything, go ahead and add another 20% on top of that. Then, you may be getting close to what you will really spend! LOL

Introducing My Business Journal

Disclaimer: This will be the longest post - EVER - on this blog.

This is my story so far.

Hi everyone!

My name is Jason and I am a small business owner. I have been running my music studio, Little Rock Jams, for two years now and loving every minute of it!

Before that, I was in mid-level management at at&t (that is the "new" at&t with lower case letters, not the old AT&T from yesteryear). Actually, I started with Southwestern Bell, which later became SBC, which then became at&t.

I spent 17 years with the company and met many wonderful people and developed great business skills over that time. But I reached a point somewhere along the road where I lost my passion for the job. In looking back, I think my passion was for advancement - you know - climbing the corporate ladder. I came to realize that with each level of management I attained, there would never be that moment where I could say "I've made it". It became clear that I was in a never ending cycle.

Well, eventually I started to loathe the job. Don't get me wrong, I worked with great people, many of whom I call close friends to this day. The pay was outstanding, with big fat bonuses every year. But I felt like I was just a butt in a seat, conference calls day in and day out. Deadlines upon deadline ... Trip after Trip (don't get me started on airport delays and missed flights). Team meetings, email, email, email....

So in 2006, when SBC acquired the old AT&T, the corporation offered a buy-out package to managment employees in order to minimize future surplus numbers. In other words, let's give some buy-out cash for those who want to leave and we'll have to fire fewer people in the end.

Disclaimer - Yep, long post - I told you so!

Before I talk about the money, I have to let you know that I am a musician. I play guitar, bass, some piano and can program a drum machine (LOL - my wife would never let me buy drums to learn). Music was my passion outside of my family. It still is to this day.

I had an idea for a music studio around 2004-2005 that I just knew would work in our market area. I would "try" to talk to my wife about it, but she wouldn't hear it. It was absurd to her that I would leave what she deemed a "pud" job with great pay, bennies, vacation, etc., for the uncertainty of the small business world.

Actually, in her mind, there was a certainty about the small business world - that is - that my business would fail and we would be screwed royally.

I'll talk more about my business, the inspiration and methods in the next post.

Well, cut to 2006 and the buy-out offer. Based on the numbers the company was offering, I realized that I would have enough capital to start a business and live on for two years before I would have to go belly up ... assuming of course that the business did not work.

I came home that March day in 2006 and casually mentioned to the wife that the company offered a buy-out and now would be the time for me to open my business. After all, I had 17 years with the company and I really felt that if I made it to 20+ years, I would be compelled to stay to make my 30 years and the retirement package.

My wife didn't flinch when she looked at the offer. She just said, "Well, if you're going to do it, do it now."

In hindsight, I believe that she probably thought I wouldn't have the balls to do it. This way, she would be the "good guy" by saying I could do it, "thinking" I wouldn't go through with it.

Well, I did and here I am, successful business with 140+ students and 3 teachers, ready to move into our new 4000 square foot facility in two weeks.

So there is my abbreviated story.

With this blog, I plan on sharing my experiences in leaving the safety of the corporate world and setting off on the small business journey.

If you are a small business owner, I hope that I can offer some insights on what made my business successful. I also hope to meet many like minded people to share ideas with.

I also plan on letting you know where I've stumbled in the past (and when I do so again in the future). There are setbacks, as in life, but it is how you handle those setbacks that determines your success or failure.

Thanks for reading the Looooooooooooong post. Keep checking in and I hope you'll like what you read!