This week’s Small Biz Chat interview is with author and small business expert Erik Vonk. Every week as @SmallBizLady, I conduct interviews with experts on my Twitter talk show #SmallBizChat. The show takes place every Wed on Twitter from 8-9 pm ET. This is excerpted from my recent interview with Erik Vonk (@ErikVonk in Twitter) who is Founder and CEO of BOTH USA, LLC, (Back Of The House). Which helps transform self-employment into a fully supported “Business of One.” They handle all the small business back office hassles. Be in business for yourself, not by yourself! For more details www.BOTHPro.com. He is also an author (Don’t Get a Job, Get a Life) and is the former President and CEO of Randstad North America.
SmallBizLady: What are key considerations for an aspiring entrepreneur?
Erik Vonk:
1. A reality check
2. Validation of the concept
3. Analysis
4. Preparation
SmallBizLady: After you start your business. What’s the next most important thing to do?
Erik Vonk: Preparation and planning are the key. You need a solid infrastructure and an appropriate support mechanism.
SmallBizLady: You suggest that most Solopreneurs (one-person businesses) set up as an LLC? Why – what are the advantages?
Erik Vonk: An LLC gives you vendor status, liability protection & is a permanent vehicle for compliance and contracting.
SmallBizLady: Why do so many start-up businesses fail within the first year of operation?
Erik Vonk: Let’s say you have started a catering business, a P.R. agency or a furniture import firm. You are an expert in that area. However, you also need to be a master in accounting, taxes, IT, legal matters, etc. to support your business. Of course, that is complicated and you simply do not have time to deal with those things.
SmallBizLady: How should a business owner balance their time between getting the work and doing the work vs. doing paperwork?
Erik Vonk: Now you are hitting on one of the most important challenges: balancing time, energy and resources spent between the “front”, and the “back” of the house. You need to keep the “front” — i.e. marketing, sales and all commercial activities going: that’s what drives the business. Yet, you cannot neglect the “back”! That’s why by the time you start your business, you should have appropriate “back of the house” support.
SmallBizLady: What do you mean by “back of the house”?
Erik Vonk: Every business, large or small, needs a complete and accurate dash board. There is no way you can fly the plane without one. It simply means that your record keeping, financial reporting and daily operations need to be in tip-top shape. It makes the difference between being in control of events — and your destiny —OR being controlled by circumstances, which is a losing proposition. The gauges on the dashboard of the plane will have to be super-accurate, or the plane will crash!
SmallBizLady: How do you suggest that start-up entrepreneurs stay on top of the back of the house operations?
Erik Vonk: Business owners need to be in control and not overwhelmed by non-core duties, so they stay focused on what they do best, and find a way to have operational and administrative hassles that challenge them taken care of by others.
SmallBizLady: How do you suggest securing accountants and legal advisors, and IT specialists who work with small businesses?
Erik Vonk: You can hire virtual assistants or independent contractors, but we suggest having service/vendor contracts with other small business LLCs. But now YOU have to make sure that all these advisors communicate with each other and are on the same page. It’s complicated and can easily become very expensive if you do not find smart, creative solutions! And, you are still taking a lot of time away from the front of your business.
SmallBizLady: How do you think start-up businesses should handle hiring people?
Erik Vonk: Why would you hire people? Neither businesses, nor individuals benefit any longer from employment contracts. I encourage entering into service contracts with “Businesses of One.” Employments contracts are outdated and are too rigid. It is much better to work with each other on a more equitable basis and exchange services for income between business entities.
SmallBizLady: What is the best thing start-up businesses do to ensure success?
Erik Vonk: Start your business and be prepared: Use @Smallbizlady’s rules. Once you are ready, don’t forget that you can be in business for yourself and not by yourself: You can have BOTH!
What advice would you offer a prospective small biz owner – someone employed or recently unemployed?
Erik Vonk: Start right. Incorporate. Form an LLC. Get the support infrastructure. When the first gig comes – You’ll be prepared!
SmallBizLady: How does your company “Back Of The House” support small businesses?
Erik Vonk: BOTH, www.BothPro.com, provides every support function a starting business needs to be successful. With BOTH, entrepreneurs can focus on what they do best, while we take care of the rest. You have one single point of contact and a fully integrated interplay between the legal, financial, banking and operational support mechanisms of the business. To begin, we’ll set you up with an LLC, or if you already have one, we’ll make sure that it is configured in the right way. Then, we’ll set up your back office, a hosted, supported and encrypted IT environment and assign a Personal Advisor to you who will do your billing, bookkeeping and collections, etc. We’ll also arrange personalized health and retirement benefits.
If you found this interview helpful, join us on Wednesdays 8-9pm ET follow @SmallBizChat on Twitter for info.
Melinda Emerson, known to many as “SmallBizLady,” is a Veteran Entrepreneur, Small Business Coach and Social Media Strategist who hosts #SmallBizChat weekly on Twitter for emerging entrepreneurs. Her first book Become Your Own Boss in 12 Months is out in March 2010.
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