It might seem like a strange and negative viewpoint to start off from but it’s important to know from the outset.
When you know how much you can afford to lose and set that line in the sand it gives you the freedom to take risks, right up until that point without ‘betting the house’ so to speak.
Whilst you might believe that you have the best idea in the world if you can’t accomplish it within your affordable losses budget then you either need to find the resources elsewhere, find a different way to do it or give up and move on.
When we talk about losses it’s not just from a viewpoint of solely money either. With new ventures you also risk reputation, time and relationships.
You need to start out with the whole picture in mind. Are your personal relationships an affordable loss when starting up this business if not you need to build it such that you can devote enough time to them.
Does your business have a strong brand in one category, will starting up in another risk damage to your reputation if it all doesn’t go smoothly (and it rarely goes smoothly) – maybe you need to have a different sub brand launch this product to test it?
With everything you need to stick to your affordable losses ‘budget’ and ensure that you don’t risk more than you can afford to lose!
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