Business START-Up or Financial Investment?

By Dr. Carl Balita

This is in response to a question sent to this column asking which one is a better alternative for overseas Filipinos – starting a business or making financial investment.  Given very limited details of her circumstances, my best answer is it depends upon your choice.  But let this column guide you through the decision-making.  In fact, one should have both!  Imagine managing your own business and at the same time growing your investment!  You will live a more prosperous life.

One cannot compare an apple with grapes.  Each has strength and risk but one can certainly engage in both business and investment.  In fact both have one end-in-mind – and that is making money.

Many investments are passive income.  They may generate profit for you without you having to work for it.  It is making money make more money.  From buying stocks to mutual funds, or other financial investments, you have nothing much to do except monitor some dynamics and measure to find out whether your money is making money.  There are companies or brokers who can guide you through it while you are learning how to do it yourself.  The risk is still there but if transaction is legitimate like those being offered by financial institutions like banks, the risk are well managed.  But unless you have big amount in these investments, and can afford to wait longer, I am biased at business start-up.

Last week, I wrote about the guidelines to investment, and let us review before I give you guidelines on how to start your business.  Those who missed that column may see and review it online at www.kabayanweekly.com.

I-nitiate a savings plan. You can’t invest something unless you saved.

N-ever succumb to the “wants.” Limit expenses to your needs.

V-alue every hard-earned money you have.  It is your sweat and blood.

E-xamine your options.  Ask! Research!  THINK and FEEL.

S-elect the best but don’t put all your eggs in one basket. Diversify!

T-ake personal responsibility for your decisions and investments.

My bias for business is for obvious reason that you can always dream big, start small and keep simple.  The business is yours and can grow it into an empire, which you can actually pass on to the next generation.  Your children cannot inherit your degree, license or employment – but certainly your children can inherit your business.  You can earn from the stockmarket but it will be a lifetime struggle to own or even be a majority stockholder of Jollibee.  But you can start a restaurant which you can grow to a brand that will compete with Jollibee.

There are many benefits from being in business – which includes being your own boss.  You will call the shots.  You could be in control.  Business can also be an expression of your creativity and passion in life.  It becomes an extension of your life purpose.  And it is your contribution to this world.

Here are some guides to STARTing a business.

S-eek the DECISION to start from the WHY you want to be in business;

T-hink of a BUSINESS IDEA that will sell and people will buy;

A-ccumulate RESOURCES that you will need to be able to start;

R-each the MARKET to understand it more

T-ry to EXECUTE as you expand the opportunities and calculate the risks

Start with a decision.  Don’t think too much, unless you already have the decision.  Don’t even search for a business idea before making a decision. The certainty of your decision will change the way you think and the course of action you will eventually take.  Some are thinking too much that they are taking forever to make a decision and upon making decision, they have to re-think and go back to zero wasting everything.  Between thinking and deciding, I suggest DECIDE! After making the decision, THINK, PLAN, and ACT with all the details towards your decision.  To simplify your decision making process, you have to be convinced WHY you should be in business.  With a clear answer to the question why, the how will be easier.  The biggest answer to why should overseas Filipinos be in business is – because they will soon be back for good to be reunited with the family and could still be productive as entrepreneur.

After the decision is made, the overseas Filipino should think of a business idea, which leads to a product or service that someone will buy.  Remember, you are only in business if someone buys from you and you are making money out of it.  Where will you get those business ideas?  Remember this TIP: Technology, Ideas, Passion.  Technology gives birth to another technology needed for it.  For example, the mobile phone gave birth to an idea of the case, the selfie stick, powerback, and others.  Look around you and find the technology that may give rise to more technology.  Ideas will come from asking yourself what is it that the people needs and wants? Provide them that and you will realize that there are many business ideas.  Passion is what you do best that you enjoy most doing that people will buy.  If you are good at baking or cooking or anything – that could be something the people will be most willing to buy from you.  Then you are IN BUSINESS.

After finalizing the business idea, you may start accumulating the resources you will need to start the business.  The resources include the 5 Ms which are money (capital), materials (raw materials), machines (equipment), manpower (people and teams), and moment (time).  Then later on come the methods (processes) and models.  Accumulate them and plan along the end-in-mind (plan).  Don’t rush these up, just enjoy within your capability to build them.  At the end of it all, you will still lack something.  Remember, a good entrepreneur will start with what they have (never mindful of their limitations).  They see what they have as good enough to start something.  If you will wait to complete everything you need, it will take forever! (and there is no forever!)

You have to understand the market more.  Specify and focus on your target market and study them thoroughly.  Who are they? What do they want? How do they want it? Where do they buy it? Why do they buy it? When do they buy it? And how much will they buy it?  The closer you get to the full understanding of the market, the more you will be able to win them and win over the competition.  Then look into the competition to make sure you have something better than what they offer.  Then you will WIN!

Then the best part of it is when you EXECUTE and TRY it.  This is where real entrepreneurs are differentiated from other people.  They execute to deliver results.  They don’t want to just sit down to plan and to talk to make a sound.  They want to act on opportunities and seize more opportunities.  They are not afraid to take risks – as they are capable of calculating risk and taking it.  If they fail and, if the failure did not kill them, then they will bounce back and make sure they learned the lessons to make their next try better with their hope for the best.

If after reading this column you feel itching to take action, you are a budding entrepreneur. DECIDE to be one and the rest will follow.