Since starting Training Industry, I’ve been fortunate to have met many exceptional people in the process of starting a training company. Some have been successful corporate executives, others from distinguished careers in the military and yet others from successful stints as training professionals. All are good development grounds for entrepreneurs and offer excellent credentials for credibility with prospective clients, but background does not always guarantee a successful company.
Some plan to launch their business as a consulting or coaching practice where training will be a component of their service offering. Others say they intend to form a pure-play training company that offers customized services or courses to suit client needs. Both will work, but again, there’s no guarantee as to what the clients will buy.
The other piece of advice I provide begins with “Entrepreneurs beware!” It’s easy to get into the business, but it’s a challenge to stay. Launching a training company is not for the meek and mild. Sadly, many very talented people who start training ventures neglect to lay the proper foundation before hanging out their shingles, or they fail to follow some basic tenents once the business is up and running. And they often pay a heavy price for these omissions.
1. Capitalize Your Business
This is rule number one, the absolute most important thing you must do when starting your training company: Make sure you have the proper amount of cash to make it through the sales cycle. I recommend you have at least six months of working capital on hand to get through the ebb and flow of cash management. It is frequently said that the number one failure of start-up businesses is not having the proper level of cash for the business they are in. Training is no different.
2. Create a Supply Chain
Recognize that the training industry is very large and complex with multiple levels of buyers and suppliers. A common mistake is to think that your only clients are the end customers of your services. Many tier 4 suppliers sell into tier 3, 2 or 1 suppliers. There is plenty of business to be had by training consultants who sell through another, larger training supplier that has an established channel to the end customer. Find the right supply chain for your business, and don’t limit your opportunities to selling direct.
3. Limit Non-Binding Partnerships
The life of an entrepreneur can be a lonely existence, especially if one hasn’t yet attracted customers or hired employees. Start-up entrepreneurs often seek relationships with others who are non-threatening and help them feel they are not in this business alone. Be careful. These relationships can become a distraction if they are not, or won’t become, contractually binding partnerships. Relationships should be about growing your business, not making you feel good. If you are going to form some kind of partnership, do it with people who have the same objective: making money for YOU. Minimize relationships that don’t pay your bills.
4. Speak Your Customer’s Language
Many people who enter the training business speak their own lingo, expecting the buyer of those services to understand. Some try to impress by using industry-based language. But remember that buyers of training products and services are not always training professionals. In fact, more than two-thirds of the value of training purchased is done by non-training professionals. So communicate your offerings and your value proposition into words that your customer understands.
5. Network with Buyers
Many well intended individuals advise that you should get to know as many people as possible. They are partly correct. Yes, networking is important, but getting to know the RIGHT people is the goal you should strive for. I often find start-up entrepreneurs attending meetings and conferences that have no buyers. Why are they there? Make sure the events you attend have the people you need to meet. Also, develop and execute an aggressive plan to meet potential buyers of your services. Don’t attend events that are full of the same people as you – places where others are looking to start a business or land a job. They don’t buy from you. Success comes from getting to know as many people as possible who buy your kind of products and services.
6. Publish, Publish and Publish some more
Buyers of training products and services are proficient at researching potential suppliers. They use internet search engines and look for things that thought leaders have done in the past. One of the best marketing strategies for any new (or mature) training company is to leverage their knowledge. Show the market that you are the expert in your field. Publish articles, blogs and case studies – anything that documents your expertise. Your ability to articulate concepts and thought leadership in writing is a great example of who you are and what you can do for prospective clients.
7. Articulate your Value
Once you have created a product, you must articulate its value to the client. A value proposition is not why you think you’re special, but why your client should think you’re special. Take your time to define it succinctly and convincingly, and then test the message with others to see if it works. But remember: If you can’t adequately explain your value proposition, you can be sure your client will not understand.
8. Productize Your Offerings
Most training start-ups struggle to accurately define their capabilities and services. They promise the customer they can do anything the customer wants. But clients buy specific products and services, not a nebulous claim of proficiency. If your main business is a service, then productive that service. Model it, and graphically show it. Anyone can claim they do custom course development, but to differentiate yourself, you must define and name the proprietary process for your course development more clearly and effectively than others. For example, Accenture has productive strategic alignment under the name Business Interlock, while Intrepid Learning Services productive its assessment service as JARS. You can do it, too.
9. Be Fully Committed
If you want to be a successful training entrepreneur, you must act the part. You must put both feet in the water. Hesitancy manifests as passive behavior. I’ve seen too many training entrepreneurs fail because they passively approach day-to-day activities. Starting a business isn’t a fast process; it can be a grind. Success comes by working through the failures on an even keel and not getting too high on early successes nor too low on early failures. Commitment means not accepting failure. We’ve all heard that success comes to those who work hard. I believe success comes to those who are committed to success.
10. Possess the Right Credentials
If you are starting a new training business, it helps immensely to demonstrate that you possess the knowledge, education or validation that proves you know more about the subject than others. A valid credential may be an advanced university degree, industry-recognized certification, professional license or something else that comes from an independent third party. Experience is also important. It quantifies the time you have invested in certain situations, although it doesn’t qualify your expertise at that skill. Leverage your credentials with experience to differentiate yourself as a thought leader.