by Bruce Pilgrim

Created on: May 24, 2007   Last Updated: May 25, 2007

Can you picture yourself running your own business? Do you ever dream of making a living as a consultant?

It is a common fantasy to dream of quitting the corporate scene, and setting your own course. While it is the dream of many people to start their own businesses, being an entrepreneur is not for everyone. Many small businesses fail, and you really need to understand what you are getting into before risking your assets, your reputation, and your self-confidence.

I am not trying to talk you out of starting a business. By all means, follow your dreams. I just want to throw a bucket of ice cold reality over your head. The following is based on some things I had to learn the hard way in starting my own business. If nothing else, reading this article may save you from making some of the mistakes I've made.

1. Are You Sure You Are Up to This?

Are you highly disciplined, a self-starter?

Are you prepared NOT to get a regular paycheck?

Can you cope with the highs and lows of an income stream? (Especially the lows?)

Running your own business can be a very lonely and very stressful proposition. It can also be wonderfully liberating and satisfying. You'll never work harder in your life, but the potential rewards are so attractive, many people cannot resist taking the plunge. Just make sure you maintain a healthy realism about your capabilities as well as the demand, or rather the market, for your goods or services.

It's really, really, really different than being an employee. In exchange for a ton of freedom, you get a ton of work and will have to handle things you never dreamed of encountering.

2. Got Money?

Maybe you're going to work out of your home, so your plan is to get started on a shoestring and grow the business when you can. That's fine, but you're going to need a computer sufficient to handle the work you hope to have plenty of, and you will also need an Internet connection, and probably a printer, and a fax, and a scanner, and office supplies, and I don't know what all.

All that stuff costs money, and while you can write it off on your business's taxes, you still have to pay for it all up front. You might be able to limp along for awhile on the home office equipment you already have, but sooner than you think, you'll need to upgrade your hardware and software. Be sure to budget enough for upgrades you might need, but don't blow all your capital on the latest whiz-bang computer and software until you have a solid plan to get a return on your investment. (You must have

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