216: The importance of having a plan - with Tim Fulton
Meet Tim Fulton
Tim owned and operated several small retail businesses in Miami. He also taught as an adjunct professor and served as the interim director of the Family Business Institute at Florida International University. Tim was a Vistage chair for 16 years, retired from Vistage in December 2018 and currently enjoys chair Emeritus status. In 1992, he started his own small business consulting firm, Small Business Matters. He has an award-winning newsletter and has self-published two different books and co-hosts a popular podcast. He also hosts one of the largest annual events in Atlanta for small business owners.
What are some of the entrepreneurial myths that you're aware of?
There are some myths about entrepreneurship that just tend to pervade no matter what. And so, an example, many of your listeners may be familiar with the book, The E-Myth, one of my favorite books of all time, written by Michael Gerber. We tend to think that most small businesses are started by entrepreneurs, you know, people with great ideas and initiative and drive and vision. Kerber found that it’s not the fact that most small businesses instead are started by, by the term he used was technicians. A technician is someone who has a particular skill and expertise and experience that causes them to then want to start a business around that experience. So that the technician is the chef who opens up the restaurant or the attorney who starts as his or her own law practice. And so that's how most small businesses get started not by the ideal so to speak entrepreneur, but by the technician.
So entrepreneurship is on the decline in the US. Why is that?
One is, health insurance, which is always kind of a hot topic. But when they study that they found that fewer people are starting businesses because they're afraid of losing their health insurance, because maybe they have a pre-existing condition. We've also got an issue around immigration. But the reality is we have more restrictive immigration policies today. About 30% of new business startups can be directly tied to immigrants, people who have just joined this this country. About 30% of new startup activity due to immigration. When we restrict immigration, it just makes sense that we're also restricting small business. The third factor that comes into play is capital. When businesses first get started, many of them need startup capital. And for some, that means going to relatives, family members. For others, it means going to a bank. And ever since the recession in 2008, bank capital has become increasingly difficult to acquire.
Any suggestions for those that do have a business and helping them grow and take it to the next level?
So a couple ideas around growing the business. One is the importance of having a plan. You've got to have a business plan. But the reality is that the SBA has studied this, the Small Business Administration, fewer than 20% of all small businesses have any type of plan. Again, you look at failure rates in small business it's more than 50%. And some judge it to be 75-80% of small businesses fail within five years. I think there's a connection between those two, that if a business does not have some type of plan, business plan in place, they’re at risk of failure.
Can you share with our listeners one of your most successful or favorite networking experiences that you've had?
There was a book that was written, you may be familiar with it. The book is called Netweaving. It takes a very different take that weaving suggests or ask the question, when I meet you for the first time, what can I do to help you? What in this short conversation, what could I learn? That would put me in a position where I could be a benefactor of yours? So maybe it's connecting you with someone within my network? Or maybe it's recommending a book? Or maybe it's inviting you to another event that might be advantageous, but it's just turning the table.
How do you stay in front of and nurture all of these relationships that you've created over time?
It was doing what I think a lot of people do and it was attending different networking events or the Chamber of Commerce, or an industry group in today's world or maybe using LinkedIn to just reach out to people. Rather than going to events. I began hosting my own events. And it started six, seven years ago, I began hosting a conference here in Atlanta. It's called the Small Business Matters conference. And I thought, wouldn't it be neat to have my own conference and I could invite people maybe who've never met, and they'll get a chance to meet people from this group, get to meet people from another group. And I'll bring in some speakers and just have a one-day event where instead of me going to try to find people, people are going to come to this event. And once a month, I host a networking lunch. And I invite people to come to lunch and I bring in a speaker.
What advice would you offer that business professional who's looking to grow their network?
One would be, I would want to be very strategic. I want to try to be as strategic as possible. Am I looking for a certain professional? Am I looking for attorneys? Am I looking for engineers? Am I looking for people older than me? Am I looking for people younger than me? I'd want to be very strategic about what that might look like in terms of growing my network. I'd want clarity around the return on investment. Am I doing this for more sales? Am I doing this to add value to my business? Am I doing this because I just want to enlarge my sphere of influence? But I think I want to be really clear about my rationale, my purpose for expanding the network.
If you could go back to your 20-year-old self, what would you tell yourself to do more of less of or differently with regards to your professional career?
I've been a prolific reader over the last decade. And I think back to my early 20s, that was not the case. And I have found that to be such an integral part of my life now in terms of learning that I would have been more mindful of reading and of learning. That's one. Two so when I was young, I just felt like so much had to be done alone by myself. And I didn't know that there was a vistage group. And if I had I'm not sure I would have joined it, or a peer group just didn't seem natural. Through my 20s, maybe into my early 30s, I began to understand the power of having peers and leveraging those peers. So I think I would have done that earlier. Also, if I were to go back to my early 20s, I would have started taking a month off a sabbatical sooner.
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