InSource Executive Shares Foundational Tips for Entrepreneurs

InSource President Jim Nickens was featured in the INDIANA MINORITY BUSINESS MAGAZINE THIRD QUARTER 2017

Formula for Success: Executive Shares Foundational Tips for Entrepreneurs

By Keshia McEntire

IN ORDER FOR NEW BUSINESS VENTURES TO run smoothly, it is essential for entrepreneurs and small-business owners to have well-laid plans and properly allocated funds. Fortunately, experts like Jim Nickens have insight into what can be done to get on the right track.

Nickens spent more than 20 years in the banking industry before joining Indianapolis-based insurance brokerage firm InSource in 2011 as its national sales director. In 2015, he was promoted to president of the company. Nickens is also a member of the Bank Insurance & Securities Association (BISA) Diversity Committee, an initiative that started two years ago as a way to cultivate conversations around inclusion.

Nickens shares tips that will ensure the success of your next business venture.

1. Build a business plan

They say with no risks there is no reward, but successful entrepreneurs know it’s essential to be smart about the risks you take. While it’s easy to jump into the water and hope for the best, Nickens suggests having a clear picture of where you want to be in five years and exactly how you plan to get there.

“The biggest financial mistake that I see business owners making is they do not build a substantial business plan. Starting up your own business is high risk. Unfortunately, if you don’t do the right planning, it becomes even riskier going forward,” said Nickens.

2. Meet with a mentor

Everyone has blind spots. That’s why Nickens says it’s so important to have a trusted advisor look over your plan before you take action. Indiana’s Small Business Administration is a great resource for budding entrepreneurs.

“I absolutely think a mentor should look over their plan before they get started,” Nickens recommended. “A mentor, like one from the Small Business Administration, can review it first and offer a second set of eyes.”

3. Get your credit in shape

Bankruptcies, foreclosures and late or missed payments could scare lenders away from investing in your business. However, there are ways to get your credit score in shape quickly. Though not widely advertised and typically offered by smaller financial institutions, credit-builder loans can help you build your credit score over a short period of time. With this type of loan, the money you borrow is deposited in an inaccessible savings account until the total is repaid. Many individuals’ credit scores often improve by more than 30 points in six months by doing this, putting them in a better position to receive help with capital.

“The first thing you should do is make sure your credit is intact, so when you go to a bank or lending institution you are in the best position to get a loan,” Nickens said.

4. Think like a lender

Your credit score is not the only aspect investors and lenders will examine when considering helping to finance a business — they will want to know how stable your overall financial picture looks and how likely your business venture is to be successful.

“Lenders look for industry experience. You need to make a compelling story that you have the skill set and the knowledge to make your venture successful,” Nickens said. “It’s not just your plan you are getting a loan on — it’s the whole financial picture.”

5. Minorities must be better

According to a Brookings Institution report titled “Minority and women entrepreneurs: Building capital, networks, and skills,” women and minority business owners have less access to external capital and rely more on personal capital when starting new business ventures. Because the median wealth of white households has been reported as 13 times that of Black households and 10 times that of Latino households, minorities often have less access to funding overall. That’s why Nickens feels that, in order to succeed, minority businesses need to hold themselves to a higher standard.

“There are things I would teach a minority business owner that differ from what I would teach a caucasian business owner,” he said. “The biggest thing I would tell minority business owners is that there are no shortcuts. For minorities, the plan has to be better, in my opinion. It has to be well thought out, it has to be properly funded and there has to be a long-term commitment.”

6. Be ready for the long haul

Once you lay the foundation for a successful, thriving business, it’s not time to slow down and enjoy the fruits of your labor. “I see a lot of businesses fail because when they started their venture, they were not prepared to put in two years’ worth of time financially, mentally or spiritually,” Nickens said. “Sometimes they are (exhausted) after three to six months, and most businesses do not turn around in that short of a time frame. Be ready for the long haul.”