The E-Myth: Is being an Entrepreneur what you imagined?

[Pesso]

Hey Square Readers,

Welcome to another round of the Square Readers Book Club! Today we’re starting our next book, The E-Myth Revisited by Michael E. Gerber!

Thanks @ChocoRee for letting us know that there's also a podcast episode by the author called ‘Beyond The E-Myth’ Framework Explained with Michael E. Gerber, that goes into a lot of the high level concepts of the book.

This book is all about the E-Myth, how it leads to business closures, and how to overcome it. 

The E-Myth, or Entrepreneur Myth, is the idea that in our society entrepreneurship and starting a business is seen as this glory-filled, magical, noble thing. That running a business leads to nothing but freedom, happiness, and profit. It’s the idea that anyone who loves or is good at doing something, can and should open their own business. That it’s easy. But in reality, none of that is necessarily true, and that mindset is what leads to the majority of businesses failing. 

The author writes, of someone starting a business, “The business that was supposed to free him from the limitations of working for somebody else actually enslaves him. Suddenly the job he knew how to do so well becomes one job he knows how to do plus a dozen others he doesn’t know how to do at all… The work that was born out of love becomes a chore, among a welter of other less familiar and less pleasant chores… [Everyone] experiences exactly the same thing. First, exhilaration; second, terror; third, exhaustion; and, finally, despair. A terrible sense of loss—not only the loss of what was closest to them, their special relationship with their work, but the loss of purpose, the loss of self.”

As we start reading the book, let’s kick off our conversations with a baseline of how you perceived entrepreneurship before opening your business, and what the reality of it has been like for you.

So let’s talk:

• What inspired you to first open your business?
• Has owning and running your business been like you imagined? What’s the same and what’s different?
• What are the biggest challenges you’ve faced when running your business?

For some extra fun, share a selfie of you with the book here in the comments! 

Don’t forget to:

• View and Subscribe to all threads about this book
• RSVP to our Live Discussion 

Happy reading,

Pesso

[martinlumsden]

I started my first business in 2008 when I took over a closed music recording studio. I'd been working in Financial Services until that time (and remained in transition for a couple more years) but had become demotivated and disillusioned. My interest had always been creative industries and when the chance came up to resurrect a defunct business it seemed the perfect opportunity.

I had actually tried to implement some principles from The E-Myth in my previous role as co-director of a small Independent Financial Adviser firm but didn't have enough influence (or determination?) to get the execution right. I then attempted to use the book as a guide in the initial stages of launching my new business but perhaps enthusiasm and excitement got in the way of actual business structuring. 

I was maybe fortunate that I was trying something completely new rather than directly transferring a role as an employee to the same one as an entrepreneurial business owner, however many of the issues I have faced come up in the book. I love the freedom but have also struggled financially and have taken very little legitimate time off from in the last 15 years. Financially it has only been very recently that I find myself on a more secure footing and it is tough moving from regulated hours and regular income to structuring your own timetable and often living with only short term income and cashflow.

I certainly don't regret it though and wouldn't go back.  I'm looking forward to seeing what ideas I can implement in my business, particularly in what is essentially a "one man" enterprise. I don't currently have staff and the service I provide is based on personal attributes rather than a conceptual service.

[Pesso]

Thank you so much for sharing, @martinlumsden , and welcome to the Book Club & the Seller Community!

I love that you took the leap from Financial to Creative, and bringing a closed business back to life is such a great way to do it. 

Which E-Myth principles did you try to implement? 

That's a really good point that you have a different situation from the E-Myth in that you're not starting doing the work before opening the business, but jumping into all new things. That could definitely help with what the business describes as setting up your own Franchise Prototype Model, where you're creating the processes and systems from scratch -- as long as you're taking the time and effort to do it. We'll talk about all of that next week!

It can definitely be a tricky transition from employee to owner. The lack of structure and consistency (especially in cash) is really tough for a lot of folks. 

Ah yes, I know those kinds of businesses very well from my own experience doing them. It's so much pressure to be a one man show, especially when the business is based all around you personally. The book definitely goes into that Technician type business, and early Phase, and recommends setting things up to separate yourself from the product. Is hiring someone and making the business less reliant all on your something that you've been exploring or thinking about?

Looking forward to hearing your thoughts and hopefully this read through with the Book Club can help you get through some trickiness! Thanks again for joining and keep an eye out every Monday for the next discussion threads-

[martinlumsden]

Glad to be a part of the conversation and looking forward to reading the book again.

I definitely remember attempting to arrange my time and allocated tasks with the idea of some being Entrepreneurial, some being managerial and some technical.  I also tried thinking about how the business might be fitted in to a variation of the organisational strategy.

One of the things I'm interested to review this time going through the book is the differentiators between a freelancer and an entrepreneur.  Much of the work I do is literally work that I do and it is my personal skill set that I am "selling".  However I am sure that in the context of working on the business, not in it there must be tasks and roles that could be reallocated or delegated.  I also have a developing media production company which may be a better focus for this particular way of looking at building a successful business.

[Pesso]

Well we're so glad to have ya here, @martinlumsden !

Ooh I really like those tips! I'm a big fan of scheduling the things that I want to do (I put my meals and workouts and and fun activities in my calendar, because if it's not there it doesn't exist) so I like that plan of setting aside time for each type of task. 

That sounds like a great thing to focus on, and I like that distinction. What does that mean to you?
To me it sounds like a freelancer would essentially be a solo employee, while an entrepreneur would be building a full business and balancing the 3 roles. There for sure would be some business managing as a freelancer, but not as much.

Great way to frame the learning and framework of the book of the "work on not in." Do you want to reallocate and delegate? I know plenty of folks who understand that that's how to grow the business but are fine enough with the way things are and don't necessarily want to change even if it could lead to improvements and better balance. Where are you at with that?

Very cool that you're also working on another business -- I think you could definitely apply learnings to both of them. Looking forward to hearing more about this production company!

Thanks again for jumping back in and sharing so much. I'm looking forward to more great chats and hearing more of your thoughts as we go.

[CareyJo]

I just replied in a different thread about using time blocks and how to create one.  I did it for decades until I got to the point that I had it under control.  Sometimes I still use it.  It's always good to have some structure so you don't lose yourself.

[phillipsrw]

The freedom of working for myself was a driving force to owning a business. From my experience I would manage the enthusiasm one has from the start, its sounds crazy to say but you need to maintain motivation and energy, get a plan together, but don't spend all your time over thinking it, and pace yourself so you don't burn as it can be a hard slog to profitability. As for challenges, these are numerous and continual, but that's running a busines the majority of challenges can be overcome theres always help out there. Most importantly enjoy the journey. 

[Pesso]

Thanks for sharing, @phillipsrw !

That's such a good point! Planning can be helpful, but over-planning can also be draining and make things less fun and exciting. It's definitely like a marathon, and the only way to make it through to have energy and motivation from start all the way through to the finish line. 

What have been some of the biggest challenges you have personally faced?

[mksavage]

@phillipsrw Love the advice of pacing yourself. One of the clearest memories I have from opening our brick-and-mortar cafe is walking up the stairs to my house after opening day, a previously undefined level of exhausted, and realizing I had to wake up in 6 hours and do it all over again, haha. We had pushed SO hard to open that I honestly hadn't thought much about what Day 2 would look like, or Day 3, Day 4, Day 97, Day 743. If you do it right, and luck is on your side, it's a marathon, not a sprint. But, it's hard to remember that in the moment when you're pushing so hard.

[isabelle]

Soooo here for the X-Files giphy! 

Also curious to hear replies about this topic/book 📚 

[Pesso]

I thought you might, @isabelle !

[TCSlaguna]

What inspired you to first open your business?

• The owner opened the store after experiencing loss in her family. The store was a way to help others in their own path towards healing and self-growth. 

Has owning and running your business been like you imagined? What’s the same and what’s different?

• I thought we'd have a personal jet by now.... But in all honesty, I didn't realize how much we'd have to be a jack of all trades. One day running reports in Excel, another fixing a ceiling fan or electrical. But it's an amazing adventure, and we try to enjoy every moment of it. 

What are the biggest challenges you’ve faced when running your business?

• I can't pinpoint the biggest challenge we have faced, but rather we are constantly faced with challenges we are trying to tackle. So I guess the biggest challenge for us is prioritizing things. Will we focus on marketing, product and service development, customer experience, or something else? Then there is the challenge of balancing work-family life and not burning out. Keeping the team's morale up and utilizing each member's skills to the fullest. 

It's an incredible journey. Take it one day at a time. 

[Pesso]

Thanks for sharing, @TCSlaguna !

It really is an interesting life to manage a business! I learned how to fix toilets, lay floors, tear down and set up a drop ceiling, and so much more. I love your attitude of embracing it and enjoying it! 

Such great points! There are always hundreds of tasks to do, and so challenging to decide what to focus the energy and attention on in any given moment.

How do you work to prioritize them? What have been your processes there?

[DinaLRosenberg]

 I have a pretty long and diverse career. Literally all over the map. I figured out quickly that providing value was the #1 thing I had to bring to any position. As I was mostly in sales, I was never "safe"- I was only as good as my last month; did I make my target or not? That's all that mattered. 

I suppose because I went to graduate school for an MBA before I started my first business (which was a birthday party facility & boutique for little girls) I had a pretty solid foundation of knowledge. I didn't get into the birthday business b/c I loved parties.. I got into it because it was something I knew I could do and the numbers made sense.

From there I went into a government job - I thought it was "safe".. that safety lasted 2 years. We had a change of administration and I was quickly replaced by someone the new Mayor wanted. 

That was it for me- I had given up my party business to go into government and it didn't provide the stability I thought I wanted. I realized the only person that I wanted to rely on was myself. 

That's what being in business as an entrepreneur provides me... the knowledge and responsibility that it's all on me. I guess because of my background I understand that running a business isn't a hobby and it isn't all fun and games- it's real work. Because I come from a family tradition of owning a business I knew and expected the work to be never ending. 

I don't see anything I do in my business to be a challenge in the traditional sense- I'm HERE for the challenge. If there weren't challenges and problems to solve, areas to improve, sales to improve.. well- I'd be bored and onto the next. 

[tranguyen]

From the outside looking in (and maybe because I'm traditionally a risk adverse person!), it can be daunting to think that it's all your responsibility to grow and make your business successful, so I really appreciated the way you frame it @DinaLRosenberg ❤️ I'm always learning something from reading your posts!

[Pesso]

Thanks for sharing more of your story, @DinaLRosenberg !

That's such a good point and impetus, a drive for safety and security, that kept steering you in the direction of your own business.

That's really interesting that you developed your party business from a business success perspective, doing the research and numbers and getting into an industry that you saw potential in rather than passion. Was that the same driver in your current business?

I love that perspective of embracing the challenge and enjoying it! There will always be challenges, and if there aren't then it wouldn't be as fun! 

Thanks again-

[BrianaJo]

I've not read any of the book yet. I'm in queue to borrow it from my local library, estimated wait time is 4 weeks. 

But I'm here for the discussions.

What inspired you to first open your business?

Short answer: divine intervention.

Long answer: I've always wanted to own my own business. I've looked into and almost started so many different kinds, but it never really worked out. One day while on a walk with our boys, my husband was approached by some little old insurance ladies on Main Street just to say Hi and oogle my babies. They all got to talking and discovered that my husband Gregory roasts coffee and I had always wanted a coffee shop. Lo & behold the little ladies' landlord owned another building a couple doors down and he was wanting it to be a coffee shop. So the little old insurance ladies told my husband he was opening a coffee shop and they'd let their landlord know. Gregory came home to me, working remotely as a medical coder at the time, and told me he hoped that I was still interested in my own coffee shop because he just got the location. 6 months later we opened and I quit medical coding. We've now been open for 10-11 months. 

Has owning and running your business been like you imagined? What’s the same and what’s different?

It has been exactly like I imagined, maybe even better, but also a little more stressful.

I'm a bit of a workaholic and I cannot give any less than my best. Before medical coding I worked at a Fortune 100 corporate cubicle doing warehousing accounting, so all the typical working too much for no recognition, promotion, or bonus, looking out the window at the sun & trees longing for something better, more fulfilling in life. Being an entrepreneur means all my heart, passion, effort, long hours, and stress does come back to me. I'll see the fruits of my labor. It may be hard to see at first, but I know in the long run it will return. That all my work isn't for nothing. It's been better than I imagined because the shop is actually succeeding, as in it brings in enough money to pay for it's own bills. It helps that people love coffee and there isn't another coffee shop like us in the entire city. Every other shop is a second-wave, burnt coffee, sugar focused, drive thru, franchise. But we are a third-wave, specialty coffee, single-origin focused, in-house roastery and sit down shop. We definitely stand out and our customers love us. We haven't even reached 1% of the population so we have plenty of people to still market to. Since there isn't another coffee shop near us, like us and we haven't even been open for a year, it's hard to plan any of the numbers, like what the seasons are like or how the customers take to certain holidays. I'd have to pinpoint the most stressful part is we jumped in with both feet. We quit our jobs to open the shop and it's not making that much money yet to pay ourselves yet. We just don't have the volume of sales I'd like to be at on an average day but every day we're getting closer. 

What are the biggest challenges you’ve faced when running your business?

I think the biggest challenges have actually been any time we hire 3rd party people. Everyone from our architect to draw the design for the city, to the general contractor to build it, to the first accountant I hire to help setup QuickBooks. The architect didn't measure anything himself and used our sketchy drawings to submit to the city. The general contractor didn't install things correctly, or build to our specifications, using whatever materials he chose instead of what we wanted. We're still trying to fix mistakes he made, from bad electrical, misplaced gas lines to leaky pipes. I'm working with a much better accountant and bookkeeper now that is helping me, but our original accountant was telling me to do things like put all our cash sales into Undeposited Funds, like the deposits we were making into the bank she had me categorize them in QuickBooks as Undeposited. It's hard to trust other people with your business because when you put so much effort into your business, it's like your heart out there on your sleeve. It's your baby. There are situations where you can't do it all though and you have to ask for help. Being an entrepreneur means I know every aspect of my business in terms of what we need to achieve and if I can't do it, or don't have the resources to get me where I need to go then I need to either figure it out and learn it for myself or hire it out to people who specialize in that. So my biggest challenge has been not letting the past effect the future. Just because the last part-timer ghosted us, doesn't mean the next one will. 

[CareyJo]

I feel for you!  I'm so sorry that you've been taken by so many contracted people!  I hope you're able to go after them for remediation of their mistakes.  At the very least, some money back.  I hope you can get everything right.

I would also recommend reading Profit First if you haven't already.  I know you're just starting out, but don't wait too long to start paying yourself or it will only get worse.  We've always paid ourselves first.

[BrianaJo]

Thanks, I wouldn't even know where to begin with remediation. I don't have that kind of time and I don't think I'd get enough back to make the effort worth it. I'm chopping it up to first time mistakes. You don't know what you don't know. But now I know. I'll look into Profit First, thanks!

[CareyJo]

It is definitely costly to seek remediation but until they are stopped they will continue to do it to others.  In most states, if you're claiming under $2500 in damages, you can go to small claims court without an attorney and for almost no cost.  At the very least you can place a lien against them through that.  It puts a judgement on their record that they cannot expunge without paying you off.  I both feel and hear your frustration in not wanting to seek it.  However, when it comes to business finances, some is better than none and stopping them from doing it to others is priceless.  You can also file complaints at no cost through the BBB, even if they aren't members of the BBB.  It will flag their business and the BBB will reach out to them to ask questions.  If they have not held up their end of a contract and you have the materials and expectations listed in such contract, you can go to the state attorney general's office and report them for fraud.  There are lots of ways to go after them without spending money.  As far as the CPA that had you falsify your records, they can be reported to the state licensing bureau.  They are like attorneys.  If they do something wrong, they can get disbarred.  If there was any chance that I could get any money back, I'd take an hour to make phone calls.  My business is too important to allow bad people to hurt people.  But that's just me.  Keep your chin up!

[Pesso]

Definitely agree with the Profit First recommendation, @BrianaJo -- thank you @CareyJo !

We read it in book club, so here's the Summary post with links out to all of our discussion posts. Hope it helps!