How Entrepreneurs (And the Community) Can Adapt After Closing Their Business
When COVID hit, we rallied around resources to help our local business folk, but what resources are available to help them through closing—and, more importantly, to get them back in the entrepreneurial game? We tapped Mountain BizWorks to answer our hard questions—what does closing a business actually look and feel like?—and our more optimistic ones, like what support systems are available for those ready to try again (that’s where their new Lean Relaunch program comes in).
Q: What are the realities of closing a business? How do we as a community support our local entrepreneurs as they go through the transition of closing a business?
Mountain BizWorks: When businesses close, either by choice or by external forces, the process is either a measured and calculated response or a dramatic, damage inflicting abandonment of the business and relationships connected to it. We call it either “landing the plane or crashing the plane.” We support entrepreneurs with landing the plane by coaching them through the four phases and connecting them with trusted resources in the community that may be needed during the full transition of landing the plane.
There are typically four stages in landing the plane:
- Decision – Making the difficult choice or accepting the reality that you must close your business and then moving into action.
- Closing – Laying off staff, delivering a public announcement, ending key business relationships, financial planning, and execution of plan.
- Grief – Processing grief and anger, restoration of self, and developing a healthy internal narrative and acceptance of what happened.
- Future – Self-reflection and musing on business lessons learned, re-establishing core values, recasting personal vision and finding inspiration and curiosity, developing a future narrative that is brighter and bigger than the past and present, seeking out opportunity that aligns with re-casted vision and new, more experienced self.
If the business closing is abrupt and caused by outside forces, as it was with COVID-19, the immediate reality is that revenues turn to a trickle or stop on a dime, while expenses continue to flow for months and can even increase. Cash flow becomes critical. Once viable and relevant businesses can get into trouble very quickly if a crisis management plan or access to financial resources is not in place before the crisis hits.
The four stages described above are the reality.
Q: What resources are available for entrepreneurs to try another venture?
MBW: Mountain BizWorks assists entrepreneurs at every stage of their business ownership, from ideation to succession planning. Perhaps the most valuable resource we provide is our diverse network of other small business owners and community stakeholders, many of whom have experienced their own setbacks and have valuable lessons to share. Our Foundations course can provide the arena for an entrepreneur to play with the viability of different ideas and use collective wisdom from their cohort to develop a business plan. The Business Coaching program provides a more individually-tailored experience, matching clients and coaches based on the intersection of business goals and expertise. More than 50 small business experts comprise our coaching team and offer a wide range of knowledge and skills to support entrepreneurs across a variety of needs.
We recently developed Lean Relaunch, a 4-week program designed to help entrepreneurs develop lean and adaptive strategies through customer discovery, scenario planning, cash flow projections, and organizational leadership and communication. The first pilot program is scheduled to begin July 15, 2020 and will be led by Jeffrey Scott of Metamorphic Consulting, and lead facilitator of MBW’s ScaleUp Program. “It’s essentially a crisis management program that will help entrepreneurs deal with any new surprises that the market deals them,” says Kareen Boncales, Entrepreneurship Program Manager at Mountain BizWorks.
Beyond the value of peer-to-peer learning, Mountain BizWorks can also provide material support via small business lending. Unlike traditional banks and lending institutions, Mountain BizWorks regularly makes micro-loans (between $500-50,000) and works with start-up businesses (less than two years in operation). Our lending team is knowledgeable about local markets and adequately assessing risk. With more than 30 years working in the Western North Carolina region and a widely experienced team, Mountain BizWorks is a proven supporter of hard-working entrepreneurs and driver of the local economy.
Q: How often is this a pattern with the entrepreneurs with which Mountain BizWorks engages?
MBW: This is a pattern that most entrepreneurs will go through if they are trying to solve big problems worth solving. The key is to help early stage entrepreneurs understand that failure is not a bad thing nor a permanent thing, but a series of experiments to learn from. I don’t know anyone that learned to walk in their first exploratory year of life that didn’t fall down repeatedly. Over and over and getting right back up again to keep trying until they got it right. There is no difference in entrepreneurship. We take calculated risks in order to gain outsized rewards and make an impact in the world.
The key is to help early stage entrepreneurs understand that failure is not a bad thing nor a permanent thing, but a series of experiments to learn from.
“Often, I am one of those steadfast entrepreneurs that has landed and crashed multiple planes, rebuilt planes while flying and even soared. I am still flying planes and will likely land a few more. Hopefully I won’t crash any more. I have gained a number of good scars from these entrepreneurial pursuits and I believe this is what it is to be an intrepid entrepreneur,” says Jeffrey Scott of Metamorphic Consulting and Lead Facilitator of ScaleUp.
Teddy Roosevelt does a good job describing it in his famous quote on daring greatly (you can replace man with other pronouns).
“It is not the critic who counts; not the man who points out how the strong man stumbles, or where the doer of deeds could have done them better. The credit belongs to the man who is actually in the arena, whose face is marred by dust and sweat and blood; who strives valiantly; who errs, who comes short again and again, because there is no effort without error and shortcoming; but who does actually strive to do the deeds; who knows great enthusiasms, the great devotions; who spends himself in a worthy cause; who at the best knows in the end the triumph of high achievement, and who at the worst, if he fails, at least fails while daring greatly, so that his place shall never be with those cold and timid souls who neither know victory nor defeat.”
Q: In the broadest sense, how do entrepreneurs “get back on the horse,” so to speak? When they get knocked down, how do they get back up?
MBW: It’s important to give yourself the necessary amount of time to process what you’ve gone through.
“For some people, getting back on the horse may take longer, depending on what else is with you on that horse, like a cart with a family. But most importantly during this phase, pay attention to the story or the narrative that you’re creating and telling yourself and how much of that is negative self-talk. That’s why support from mentors and peers, others who’ve experienced falling off the horse and gotten back on, is so important to help you understand the full arc of the narrative,” says Scott.
Once you’ve gone through that grieving process, curiosity is the signal that you’re ready to get back on the horse. Curiosity leads to searching for answers and a willingness to step into a place of uncertainty. As an entrepreneur, you have to find out how to spark that curiosity that will inspire you to seek out new opportunities. And then you need to take the lessons you learned from your past business venture, recast your vision, re-establish your core values, and then tap into a good support network. This is where Mountain BizWorks can really help. Our programs emphasize peer-to-peer learning, where you share ideas, feedback and support with other entrepreneurs who are on the same stage of the entrepreneurial journey.
Our Foundations Business Planning program can help you explore the viability of a business idea and then develop a plan for implementation.
Our Lean Relaunch program, which focuses on the key concepts of Customer Discovery, Scenario Planning, Cash Flow Projections, and Organizational Leadership and Communication, will help you develop crisis management skills and tools that will ready you for the next crisis, because there’s always going to be another crisis, but no matter the shape it comes in, you’ll have the adaptability and readiness to survive and thrive.
Then there’s the matter of getting funding. “When it comes to our lending services, Mountain BizWorks uses a holistic approach in determining someone’s loan readiness. We focus on developing that client relationship to understand that what’s behind a client’s negative credit history may not necessarily be a reflection of where they are now in their capital readiness. Unlike large traditional banks, we have more flexibility in working with clients and customizing the business solution based on their needs,” says Boncales.