It was post-lunch, and I was sitting on my couch trying to find my productive energy, with the air-conditioning on during a particularly hot summer day. Sitting opposite me was a friend of mine. We had come together to discuss our next big project.
However our conversation managed to balloon beyond our initial subject limitation and we were jumping from topic to topic, with each new issue opening up something else. As the afternoon progressed it became clear that we weren’t going to reach any specific conclusions that day, although the discussion was certainly helpful. As he pointed out, decisions made now will impact where you will be in six months.
The start of a new year is a particularly important time as most people start new projects, or begin new phases in the development of their business. In our case we’ve reached transition points, where we face a huge array of opportunities. He and I don’t face the same decisions on all levels since our personal lives are different, as are the stages of development of our businesses.
Since we share projects, some of the decisions we make must be made together, and when that happens, we need an extra level of clarity because what we do impacts not just ourselves. It’s easy to change things when it’s only you in charge, but when you are in a partnership, each shift requires involvement of your partner, or you risk creating confusion and even conflict.
Many of the new opportunities open to us, such as the live event, are projects that we have very little experience with. We’ve attended live events before of course, but never hosted one ourselves, hence we’re wary of what we don’t know that we need to know and prepare for. Making the decision process even more complicated are the existing projects we have, which could be optimized and expanded, if we choose to follow that path. To put it simply, this isn’t a simple decision. There are many interrelated issues, conditions and decisions that have an impact on other decisions.
Normally I pick one major project and focus most of my “new creation” energy there, while working to keep the regular processes, like blog articles and email content flowing as usual, but this time it’s challenging because all my new opportunities really are new.
The rest of my decision making for the next six months is still a work in progress. This is of course not the first time I’ve faced this kind of “problem” and it’s a very common one for entrepreneurs. Even as you become more stable, develop cash flow and determine what projects are worth pursuing and what should be scrapped or avoided, it doesn’t make the decision making process any easier.
In fact it usually becomes even more complicated, since success tends to open doors to new opportunities, and you always have the opportunity to improve on what’s already working. So how can you find the answer to the too many opportunities problem, especially when you reach major transition points in your business life?
Financial Return Vs. Personal Satisfaction
There’s an interesting thing that happens as your business grows. All early decisions are pretty much focused entirely on establishing cash flow. I know for sure if you’re getting started right now with your online business, your first goal is to generate money.
Momentum at the start-up stage is all about first surviving, then establishing cash flow to stabilize what’s working by bringing on more resources, in particular more people to help. Once cash is stable and you have at least a base level of regular income coming in, your decision making process actually becomes easier in some respects, since you don’t need money quite as desperately.
Instead you’re looking to keep things moving along smoothly, keep the growth curve trending up by using your cash to open up the floodgates on what’s already working. Once you pass through this stage, you can finally breathe a little, confident that your business is running reasonably well without risk of falling apart.
If you’ve built a money making machine business and have systems and people running things for you, your own workload will drop at this point as well, freeing you up to make decisions on where to go next. It’s at this point that your decision making process changes. This is a good time to engage a small business coach or consultant to help drive the growth as well. It’s no longer just about the cash, instead you choose projects based on what you want to do.
Of course financial objectives are still important, but the feeling of desperation subsides, and you can go somewhat where your heart wants to take you, as well as your wallet. This is a wonderful position to be in, but don’t be under any illusion that it’s easier, it’s actually more complicated because you have considerably more options to choose from.
The downside risk is usually less, depending of course on what level of investment is required of you in new projects, but if you’re a boot-strapping kind of entrepreneur, or building online businesses, the risk is low. The biggest loss you might have is the time it takes to get a new project off the ground.
You could lose money too if your new project doesn’t work, but unless you’re spending significant amounts on advertising or software development, which are not the kind projects I currently focus on, then you really have very little to worry about beyond that sense of disappointment when something doesn’t take off like you hope it would.
The real potential danger in this decision making process is opportunity cost . Making a decision to focus on one project means you can’t work on another. If the potential upside on a successful project is hundreds of thousands or even millions of dollars, then choosing one opportunity over another means you could be “risking millions”, though the difference between losing millions compared to just not making millions because you choose a lame duck project is quite different.
It’s still a relatively safe place to be making decisions from. So that’s basically where he and I find ourselves now. We have plenty of opportunities to make money by starting new projects and optimizing current ones, possibly even selling assets, but cementing what to pursue while a tantalizing choice, is still a difficult one because we forgo one opportunity by choosing another.
We also have to be sure to balance what we want to put energy into with the potential to profit from it carefully. The holy grail is a project that is fun to work on, satisfying on a personal level, and is the most or one of the most profitable.
Identifying which opportunities match this criteria is actually very difficult because of the amount of unknowns and the nature of uncharted territory.
Choose The Simplest Path
The best advice I can offer you, which is the same advice I follow, is to seek the simplest path to the lowest hanging fruit, which represents both a financial and personal reward you are happy with. By this I mean, choose the opportunities that are simple in nature, which you are clear about how to begin, that you are excited to do, and the numbers are satisfying, if things go well.
This process helps save you time, and is going to be different depending on what stage your business is at. As I stated before, the level of momentum, your resources (including staff), and cash flow currently flowing in your business, dictates how much freedom you have to choose projects based on money versus fun. Consider this when deciding what’s important to you and offers the quickest return on investment.
In my experience, having one major project going at once, which you work on to completion before starting another, is a successful formula. This gives you clarity of purpose and more importantly, tells you what you definitely shouldn’t be doing (anything that’s not related to that specific project).
In your case you likely have a skill, or talent, or perhaps you’ve built up something to a point where it could be leveraged for more, and you’re reasonably clear on how to start the process, or are at least prepared to put in the time to learn how to make it a profitable venture, which represents a lowest hanging fruit opportunity.
It’s not always a cut and dry decision, and you may need to seek input from your peers, or a coach or mentor, or as I like to do – mull it over for a while so you get a really good feel for how much you want to do something – just not too long! It also helps to write out your opportunities on a piece of paper and rank them based on criteria like how much money you could make, how much fun it would be, how quickly you could earn a return and how much is your potential loss.
Sometimes having this information written down and then put into a graph results in a very obvious winner – the numbers don’t lie if you’re being honest with yourself. The most important point is, once you’ve made a decision, focus all your energy on that and ignore everything else. If you want to guarantee failure or at best, a very slow path to success, keep distracting yourself with new opportunities.