Some months ago I met two young ladies who were working on a plan for a new business. They had a database that they wanted their customers to access through their web site for a fee. We reviewed their specific requirements carefully and realized that the cost of the custom software was going to be in the six figure range - which stopped the project.
Many small businesses are boot-strapped via credit-card financing. There's not much wrong with the idea - actually it's in some ways one of the most beneficial limitations that young entrepreneurs face. When trying to grow a business the last thing you need is massive debt for any period of time. We all know that credit cards come with staggering interest rates. It makes good business sense to limit each business step you take so that the implementation cost fits into your credit card and, here's the important part: immediately generates revenue that will quickly pay off the credit card and start to fill your savings account.
Some customers are in a different situation: some managers in large corporations have said things like "money is not a problem." They have been given a budget that they think is huge - so they're ready to spend heavily to get exactly what they want.
Unfortunately, for those of us who have lots of money and also for those of us who don't: The stumbling block that we all tend to fall into is our perception of wants vs. needs. We often feel that we can't move forward unless everything we want is perfectly in place - but is everything we want really immediately necessary?
Fortunately, there is a way to find out: Simply prioritize. Which of my wants are most important for this week? Which ones can wait until next week? The perception in our minds is always, "What can I live without," but that is absolutely not the question at hand. The real issue is "What is the minimum that I absolutely need today so that I can make more money than I made yesterday?"
Of course, to be able to do this you need a good idea of what you can do today with the tools you already have. Here's the good part: Open Source software provides you with many of the tools that you need to get started. They're not perfectly matched to your requirements but they already exist and they can work for you - but only if you take the time to investigate seriously.
If you don't have any experience with Open Source software, you don't realize that there's quite a bit you can do with very little investment. So, the first thing you should do is go ahead and play with some inexpensive options and find out how much you can accomplish with them. You will certainly be surprised.
It can sometimes be frustrating to be faced with a huge project and not know how to move forward. This is a common experience. The solution is simply to try not to do everything in one shot. Just take your time, play with the software, find out what you can do and try to do it one step at a time.
Surprisingly, it helps if you don't try to accomplish much of anything at all. Invent some small projects to start you off - something very basic - like trying to use the tools you have to make a list of your favorite books or music CD's. The exercise might be pointless but it will give you a chance to learn about the tools you are playing with and what you can do with them.
Once you've learned a few things about a new tool (such as Joomla or Drupal,) you can go back and look at your business plan:
- Of all the steps in this plan, which ones can I accomplish right now without developing any new software?
- Is there some way that I can put together a partial solution that will be able to generate revenue?
- How can I adjust my long-term plan so that I can integrate these new opportunities?
You remember the two young ladies that I mentioned earlier? Recently, I found a guy in Germany who has created an Open Source component for Joomla. It can do some of what they need. He's charging under about $50 for the source code. One person who purchased it reported that it did not work for him but was quickly fixed. This software would not do everything called for in the young ladies' long-term business plan - but it would get things started and $50 is much less expensive than $100,000. Some of the remaining $99,950 would still have to be spent - but most of it would go into future project phases that would be paid for through profits from the initial phase. This is the ideal way to build a company.
Open Source software does not start out as a perfect solution - but it can be adapted to become a perfect solution. It really is a solid foundation on which you can build your revenue streams and, from there, whatever you want to build.