The high cost of entrepreneurship

So you are ready to start your own business! It’s a time that is both exciting and possibly nerve-racking. But there are so many reasons to do it, right? To be your own boss. To set your own hours. To realise your dream. And most of all, to provide the kind of financial reward and security that working for someone else can rarely offer. And you are re right, of course, in principle. Successfully starting, running and ultimately exiting a business can deliver on all of these promises.
However, before jumping into the waters of entrepreneurship, there are other sides of the coin you should be prepared for as well. Upon setting out on your new venture, gone will be the safety net you may well have become accustomed to: the regular salary. If you are funding the business yourself, you will hardly be able to pay yourself a salary. And if you are seeking outside funding, the last thing investors want to see in the “use of proceeds” table is a comfortable salary for you.
Without outside employment, you now also have to consider things like health insurance. The cost of being self-insured is becoming increasingly higher. Once your company may qualify for a small business group rate, it helps. But remember, you are the company. If you have the company pay your insurance, it is still you paying for your insurance. Every dirham or dime spent, is less money you have to work with in growing your business.

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