Buy-In: Is That Always the First Step Towards Success?Monday, January 28, 2013 Mary Anne Velasco
In the business world, it is often said that entrepreneurs need to get buy-in, before their idea will fly. This is true, but not necessarily in the sense that many business owners think. Without any buy-in, a business will not succeed. However, many small businesses do not need partners to financially buy into the company.
● Financial Buy-In is Often Not Needed
One of the greatest struggles entrepreneurs face is raising capital. Some raise their capital by taking out loans, but this is not the right solution for everyone. Those who do not have good credit or do not wish to bear all of the risk of founding a business themselves often seek out investors. If one is to raise capital by partnering with investors, then a financial buy-in is necessary.
However, many companies have been started and grown without the financial buy-in of others. Many businesses have begun with just a few thousand dollars – or even less. With a little creativity, entrepreneurs can often find ways to greatly reduce their start-up costs. This often requires starting small and slowly growing a company, but this is exactly what Bill Parsons, the founder of GoDaddy.com and other companies, recommends. Bob Parsons' advice to budding entrepreneurs is to, “Start small, stay focused.” Bob Parsons gives this advice and has numerous success stories to support his advice.
● Buying Into Your Own Business
Although financial buy-in is often not needed, people need to buy-in to your vision for the business. This buy-in must begin with yourself: You must believe in the vision. There are two aspects to this belief. You must believe in the company and in yourself.
Buying into a company is much more than simply having a dream. This is what separates entrepreneurs from dreamers. Many people have grand dreams of working for themselves or in their dream jobs, but successful entrepreneurs focus this vision and believe in it. An example makes this clear. A dream is to one day own a restaurant. A focused vision that can be bought into is next year owning a coffee shop to serve people in the hospital district. People, including yourself, can buy into this vision, because there are tangible aspects to it.
You must also believe in yourself. Anyone who has experience founding a business knows that it is extremely difficult. The work required to succeed as a business founder is hard, and there will be discouraging times. Before beginning, you must believe that you have the skills, knowledge and determination it takes to make the vision succeed.
● Getting Employees to Buy-In
If your business idea includes employees, then they must also buy into the vision. Without the support of people beneath you, the idea will fail. If your employees do not care about their work, then their lack of performance will deter customers. Your own energy, which you will not have any to spare, will be needed to overcome their shortcomings.
There are several ways entrepreneurs can encourage employees to buy into the business. The most important is screening employees carefully during the interview process, hiring only the ones that are excited about the vision for the company. Business owners must take however much time is necessary to find the right employees. For, hiring the wrong employee to solve an immediate crisis can have long-term detrimental effects on a business. In addition to this, entrepreneurs can:
- Build relationships with their employees
- Showing employees how they are making a difference in people’s lives
- Treating employees fairly and well
- Giving the employees and incentive to see the business succeed
● Getting Customers to Buy Into the Company
Without customers, no business can succeed in the long term. These are the final people’s buy-in that a business needs to succeed. In addition to providing meeting a need by providing a good product or service at a fair price, the CEO of Go Daddy has some advice on getting customers to buy into a company. Bob Parsons has four tips for business owners [https://www.godaddy.com/]:
- Make it clear why customers ought to buy this product or service instead of a competitor’s
- Back-up the product or service with a guarantee or return policy
- Make the purchasing process easy by providing many ways to pay for and receive the goods or services
- Overall, go to extensive lengths to take care of customers
These are the steps Mr. Parsons has taken to found three multi-million dollar companies, and they can help your business succeed as well.
So, is buy-in the first step toward success? If one is thinking only of a financial buy-in, then the answer is no. There are creative solutions to overcome a lack of capital. If buy-in means getting people, including yourself, employees and customers, to believe in the company, then the answer is a resounding, “Yes!” Without it, no business will succeed.