The Complete New-Business Survival Guide

Inc.'s catalog of the best books, agencies, networking groups and information sources for the self-educating CEO.

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New-Business

Survival Guide

Where can you learn about locating capital, finding the best advisers, controlling cash flow, or doing on-the-cheap market research? Here's help: Inc's catalog of the best books, agencies, networking groups, and unique information sources for the self-educating CEO

Times have changed. Planning is in. The much-mythologized, hip-shooting gunslinger-entrepreneur is dead. Homework -- among start-up founders -- is back.

But apparently, not the right kind of homework.

In an oft-cited National Federation of Independent Business study of 2,994 new companies, 43% of founders reported they had seriously considered their start-up for a long time before things finally came together -- they'd studied, reflected, and planned. And yet, the 1990 study discovered, the "planners" as a group proved no more likely to survive the first three years than the business owners who weren't given either to planning or to cautious decision making (namely, the "a-good-opportunity-came-along-and-I-jumped" crowd).

So why don't the conscientious students get an edge? Because too often and all too understandably, they begin their homework without knowing what it is they don't know. The process of creating and managing a company is to the neophyte founder so bewildering and so opaque that instinct can't possibly reveal where his or her knowledge has gaps. Instinct propels founders toward the obvious: where to locate, how to find money, what's a good format for the business plan. Indeed, most would-be CEOs still spend too much time perfecting each mousetrap before considering whether anybody might really want to buy it.

Identifying what you don't know, then, is the first crucial step in starting a company. Here's more evidence: In "The Truth About Start-ups" ([Article link], April 1991), Inc. revisited the 27 companies profiled in the Anatomy of a Start-up series from 1988 through 1990. The CEOs we tracked over time found they had underestimated a lot of things, including the time and effort needed to test an idea; the industry experience required; the intelligence of the competition; the sales cycle (the time it would take for the customer to actually purchase); the time involved in being the boss; and the emotional cost of going it alone. They discovered knowledge gaps and skill gaps they'd never anticipated. And, because they had to fill those gaps to survive, they discovered the pressing need to learn how to learn.

The rigorously selected resources in this catalog -- the people, organizations, books, pamphlets, and tapes -- will, we hope, help.

The books we recommend reading first (see "The Big Picture," page 2) will give you a view of the start-up process as an organic whole, plus glimpses of company-operations specifics. From Peter Drucker, Paul Hawken, and friends you'll gain an awareness of what you don't know about running a company. Also, you'll find thoughtful approaches to another, less tactical set of questions -- ones that speak to your deep-seated dreams, personal goals, ethics, and ideals. What are my measures of success? What kind of company do I want? How big and how fast should I grow it? Can I have a life, too? Should I have a partner?

None of those questions is easy to answer. And as soon as you've answered them, you'll be confronted with more. So turn to our catalog for a guide to the best sources of help. Bounce your concerns off outside advisers; read about bootstrap market research; get ideas for starting, and paying, your work force. We've made the best Inc. reprints available, too -- assembled for each category of need.

"Once you have learned to plan," writes Hawken in Growing a Business, "you have to plan to learn." Let the homework -- the inspiring, problem-solving, dream-saving, right kind of homework -- begin.

THE BIG PICTURE

What these six books below amount to is the best short syllabus available on new-business creation -- the ideal start-up overview.

The primary texts are Timmons and Hawken. Try reading them together, or reread Hawken while you're working your way through New Venture Creation. The two authors touch on many of the same topics and sentiments, with very different styles. Hawken, for example, eloquently advocates the need for finding the start-up process and pacing that are right for you. Timmons does the same thing (Chapter 17, specifically) in workbook fashion, by using case studies that offer specific examples of how to learn as you go along. Their company examples tend to be complementary, too (Hawken heavy on California and consumer businesses, Timmons citing more manufacturers). Timmons's book weighs in at 700 pages; you can skip some of his exercises and still get a lot out of it, as it's so rich with resources. At 250 pages, Growing a Business appears lighter, but first-time entrepreneurs will find themselves reading some paragraphs two and three times before turning the page.

Like Hawken, Drucker has a concise way of wording things in The Practice of Management; of his many books, this is the one to begin with. It's a must-read before you write a business plan, says one CEO, as well as a "timeless" reference book. It was published decades before anything else on this list, yet chapters such as "What Is Our Business -- and What Should It Be?" deliver a very modern message about the importance of staying close to the customer. Fundamental start-up questions are handled in chapters such as ~"What Is a Business?" and "The Small, the Large, the Growing Business." CEOs who are further along in the company-building process may get more out of this book than Growing a Business.

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