Local Entrepreneurs Impart Advice
Ideation to Creation
(above) photo by Lanewood Studio
Miguel Morales
Entrepreneur, Co-Owner, 1885 Grill, Tremont Tavern, The FEED co. Table & Tavern, Parkway Pourhouse
What characteristic is most important for an entrepreneur to possess?
As an entrepreneur, you have to have a “make it happen” attitude. It’s this mindset that enables you to think on your feet and prepares you to handle all the obstacles you are confronted with.
What’s the biggest challenge new businesses face?
After developing the idea, the challenge then becomes how to kickstart the idea and turn your dream into a reality. When starting a new business, it can be difficult to find answers to all your questions and determine the first steps to take. I recommend visiting Chattanooga’s Business Development Center and signing up for orientation. This program allows you access to Chattanooga area professionals that not only know what you need but will help you obtain all the necessary items. After orientation, you have a checklist of contacts to call and you know what order to start.
What advice would you give to someone seeking capital for their new concept?
Before you go to any financial institution, you need to know exactly how much money you need and how much the business has the opportunity to earn. This will help you know if the money you are asking for makes sense and if it’s feasible to pay back the loan. Create a comprehensive business plan, design conceptual drawings, prepare your profit/loss documents, and know your facts. Don’t just tell your financial institution how much money you need; explain why you need the capital and what it will be used for. The more you can show the reality of your business, the faster you can see your dreams come to life.
(above) photo courtesy of Kush Shah/by Krystal Woods Photography
Kush Shah
Co-Founder, DosBros Fresh Mexican Grill
What advice would you give someone who had an idea but didn’t know what to do next?
First, never be afraid of asking questions – no matter how silly you think they are. I had an idea to open DosBros Fresh Mexican Grill in Cleveland, Tennessee, where previously Moe’s Southwestern Grill had shut down. After researching, I took a calculated risk and it paid off. Don’t be afraid to gamble and take a calculated leap of faith.
What is the best way to do market research on your new idea or product?
The internet is the best tool available today. I started spending hours reading about different brands, learning from the reviews that customers left. I also started traveling to these restaurants and spending hours inside trying to figure out what customers enjoy and what makes them so successful. By the time I started designing DosBros, I had already visited and tried over 100 burrito restaurants and knew exactly how I was going to design my brand and recipes. Make sure you use all the resources available to you before making a big investment.
How do you know when you’re ready to jump in?
Trust your gut feeling. When you cannot think about anything else and your idea does not let you sleep, then it’s time. It’s essential to do calculations and projections, but you can’t solely rely on them. Remember the best lessons are learned from the mistakes that we make or the failures that we face, so make sure you don’t miss the train.
Shelley Prevost
General Partner, The JumpFund
What advice would you give someone who had an idea but didn’t know what to do next?
Start small, but act immediately. Test your assumptions. If you’re building a product, get a group of people together and learn what you can about the problem you’re trying to solve. If you’re offering a service, offer something on a trial basis or as a pilot to collect feedback. You can also do early ad testing on social media for low cost. When you finally nail down that your idea has legs, then you can grow it into a viable business.
What is the best way to do market research?
You can’t do market research until you put something out there, so put something out there. I would also suggest not relying on friends and family for market research, who might automatically approve. Get to people outside of your sphere. In the consumer space, that’s usually done by creating “dark ads” on social media and letting the data lead you. The data won’t lie. Either people are interested and click on your ad, or they don’t.
How do you know when you’re ready to jump in?
It’s a lot like marriage or having a baby, you’re never really ready. There’s a point in time when you make a decision – you say either ‘Yes’ or ‘No’ – and you start executing. To say ‘Yes’ is to be on a roller coaster ride of figuring it out from that day forward. There’s no magic to it; it’s really that simple.
Jack Silberman
Partner, Reliance Human Capital Management
What advice would you give someone who is in the process of creating a new concept?
We started a company to attack a very old industry in a new way, so for us it was about being bold, creative, and willing to outwork our competition. One of our core business principles has always been to own up to mistakes and pivot when something isn’t working. Some of our early ideas about our team structure didn’t work out well, and we shifted our focus and our approach to capitalize on what we found successful.
How do you know when you’re ready to jump in and launch your concept?
We knew we were ready to launch a new concept when we realized no one in the industry offered what our clients desired. We believed strongly that our concept was what the market was demanding, but didn’t have the support or tools to act on that. We don’t determine what the market demands, our clients do. Sometimes there are no other options than to leave and strike out on your own.
How do you keep your overhead costs low? What are strategies for running a lean startup?
We operate around investing in people. We create a high growth plan for our employees because we know that in order for us to scale, we must have continuous sales. That mentality takes a big investment in human capital, which in turn builds our company.
Jonathan Frost, MBA, CPA
Managing Partner, J.D. Frost & Company, PLLC
What advice would you give someone who is in the process of creating their business plan?
Know the numbers. Ensure that your projections of future income are going to take care of costs. And don’t forget to include how to pay yourself. Far too often, business owners allow their “bootstrap mentality” to encroach upon profits. Generating and maintaining a profit is vital to being a successful and happy business owner.
How do you know when you’re ready to launch your business?
You cannot wait on the perfect time, but if you jump in with a plan in place, you are ready. Have a wise coach to help guide you. No one has the market cornered on good ideas, but a coach can provide valuable insights and speak into needed areas of your life and business.
How do you keep your overhead costs low?
You can do a lot of things to keep your overhead costs low, but that shouldn’t be your main focus. Focus on growing first and overhead costs second. Far too often, business owners are terrified of debt. The ability to properly understand and leverage debt is critical to growing a business. While you certainly want to be wise, I caution business owners to steer clear of a purely “lean” mindset. Similar to an athlete needing fuel to compete at an optimum level, your business needs a healthy diet of capital to thrive. Don’t be foolish, but don’t starve your business when you should be growing.
Matt McGauley
President & CEO, Fidelity Trust Company
What advice would you give someone who is in the process of creating their business plan?
It’s easy to be overly positive when creating a new business plan, especially since you’re typically so excited about your new venture; however, you must be extremely realistic. Do not use your business plan to convince yourself into a business. Try to talk yourself out of going into the new business with your plan, and if your extremely conservative, heavily scrutinized plan still makes sense, then you can go for it!
How do you know when you’re ready to jump in and launch your idea?
I’m ready to jump into a new development when I’m confident in my level of research, my extremely conservative models still point to a profit, and everything else feels right in my gut! It’s equally important to be both educated and confident before you launch.
What is the best way to do market research on your new idea or product?
Being in a specific type of commercial real estate, I look out into the market and take note of what people are demanding. Then I try to identify what elements of successful projects differentiate them from others. My diverse portfolio of property and tenants makes for a great living laboratory. I’m always asking tenants what they like best about their spaces and, more importantly, what could be better. Lastly, I look to larger markets for inspiration. I challenge myself to bring the expensive “big city” look and quality into a price-competitive product in the Chattanooga market.
George Yu
CEO, VARIABLE, INC.
What characteristic is most important for an entrepreneur to possess?
Persistence. I can’t tell you how many times I wanted to give up, but I persisted and fought on.
What’s the biggest challenge entrepreneurs face?
The biggest challenge is truly understanding if the market wants your product or not. I always challenge myself to make sure my product brings value to my customers. Initially, we did this through crowdfunding. For us, it was a great way to test market reaction to a physical product or idea without having to actually manufacture it en masse, and spend all of our time and capital on an idea that may fail.
What advice would you give to someone seeking capital for their new concept?
Network like crazy to find people that believe in you. The networking also does not stop. You have to get investment at each stage of the process. I funded the creation of NODE using my own savings. I then turned to Kickstarter to gather market feedback and traction to convince angel investors to give me the seed funding needed to make NODE a reality. Further funding from investors was based on milestones we achieved.
Jesse Rogers
Managing Partner & COO, Boathouse Rotisserie & Raw Bar, Sugar’s Ribs, SideTrack
What characteristic is most important for an entrepreneur to possess?
Ambition. You don’t meet lazy entrepreneurs, and you don’t meet entrepreneurs who want something for nothing. If they want something, they are willing to work for it. And, once they reach their goal, they set a new higher goal and start working toward it.
What’s the biggest challenge entrepreneurs face?
Currently, it is finding good employees and then training them correctly. This is imperative in any successful business, but even more so if you want to expand. We’re lucky. We have many great, long-term employees that are the backbone of our company and the reason we’re successful. I wish I could clone them! We strive for our employees to be able to earn top pay and benefits for their positions. But once you hire a great staff, it doesn’t stop there. You have to follow a thorough training program to ensure employees have everything they need to be successful. If you skimp on training, you are wasting time, money, and worse, possibly running off employees that had great potential.
What advice would you give to someone seeking capital for their new concept?
You must have a well thought-out business plan with as much detail as possible. Look for the weak points in your plan and think through potential problems. Also, you are not just selling the idea. You have to sell your own value in the business.