Listen to the Conversation with Elaine Pofeldt

The increase in the number of people starting their own businesses in the United States has surged. And so far, the entrepreneurial boom has proved to be more durable than early skeptics expected. Starting and growing a business can be challenging, but it also provides many rewards.

In her book, The Million Dollar One-Person Business, Elaine Pofeldt outlined the pathways to joining the entrepreneurial movement. Now in her new book, Tiny Business, Big Money: Strategies for Creating a High-Revenue Microbusiness, she offers the steps toward the next entrepreneurial venture – a microbusiness. Elaine is an independent journalist who specializes in small business and entrepreneurship. Her work has appeared on CNBC, and in Fortune, Money, Forbes, and many other publications.

Pofeldt believes that many people are becoming entrepreneurs because they were in work situations that weren’t ideal for them, that weren’t healthy for them. During the pandemic, people who couldn’t cope with the discomfort any more, started to experiment with the idea of launching a small business. Working from home provided the privacy and opportunity to try. Many realized they like working for themselves and that they were good at it.

Making the transition from a non-employee business, one with no payroll, to a microbusiness, one with employees, comes with new challenges. There is a big change in mindset that is required when you’re managing a team because you have to convey the purpose of the business, said Pofeldt. How you want things done, how you want customers to be served. That can be difficult for people who have been solopreneurs.

Knowing when to grow a business can be frightening for many, but as Pofeldt notes, that point usually comes when you start noticing slippage in the business; you’re not able to make deadlines or you get sick for one day and the whole things starts falling apart. That’s usually a sign that you’re maxed out and don’t have enough backup in place.

Before taking the leap, Pofeldt cautions business owners to make a financial analysis to be sure the company can support employees. “You have to make payroll, that’s a legal requirement,” she said. “You can’t just not pay people because you’re short on cash. You have to make sure you have the cash flow to support paying each employee consistently.”

Pofeldt’s best advice for success? Don’t be afraid to trust automation. Analyze how you are spending your time during the week. Create a sheet and put down what you do every hour of the day and take a look at where you are spending tasks that could be done with technology, an outsourced service, or somebody else.

Listen to the Conversation with Elaine Pofeldt