Here are the reasons why business coaching is crucial for start-ups :

• The most of the start-up entrepreneurs are new to the business world therefore they may not know the business principals, legal requirements to do a business, taxation rules etc. I know an entrepreneur who started a service business in 2009. Being a new businessman and coming from a non-business family he was not aware of then prevalent taxation rule – when the revenue crosses 10 lakh in a year the business needs to collect service tax from the client and then deposit it to the government. Therefore he did not collected any service tax from the clients. After 2 years of operations he was happy and satisfied that he made good profit. Service tax people came after 2 years for a routine check. They demanded around 25 lakhs from him for service tax not paid , interest and penalty. He told them that he did not collect any tax from the customers as he was not aware of this rule. Finally he has to pay a significant amount to the tax authorities. He lost all his profit of 2 years due to not knowing this rule.
• To decide on whether to enter any business or not, requires through due-diligence. To narrate another story a businessman Ravi, who was well established in electronics business wanted to diversify his business. He got one opportunity to buy an existing and operational restaurant business. The interiors where great and were done at the price of 1.2 Crore. The incumbent owner was selling it for 80 lakhs. Appears to be a great deal. Ravi bought this restaurant without any thorough due-diligence. He was not able to run the restaurant due to not having restaurant’s domain knowledge and also due to restaurant was in a far away mall from the city. The fact that the incumbent owner was not able to get sufficient number of customers due to location being not in a reachable range for most of the city’s population, was totally ignored and was not considered in the buying decision. He lost nearly 2 crore in this businesses as for most of the months business was in loss. In addition he did not even filed the timely income tax return of this loss. Had he filed the timely loss return he would have adjusted the loss against his profit of the electronic business and would have saved huge tax in a legal manner. Not only he lost 2 crores but also wasted significant time and effort in operating and trying to revive this business. Had he spent 2 hours of time with a good business coach all these losses of money, time and effort would have been avoided and his quality of life would have been much better for those 2 years.
• The most amount of support is required by start-ups. They need some experience and mature person to guide them and to do brainstorming with them.
• Being a startup founder is so intensely stressful, from working hard to create a good product or service, to getting traction with end-users, to fundraising (and being rejected), to hiring, firing and managing employees, to balancing personal needs. Being an entrepreneur oftentimes means being alone. And there are conflicts when a startup founder tries to vent to investors, significant others or employees. In these conflicting situations they need a third party and expert view to know where they are wrong and where they are right.
• There is no one to listen to a startup founder to be honest about his greatest fears and his grandiose visions. Entrepreneurs need huge doses of optimism, encouragement, wise feedback, an open heart, and just an opportunity to be completely and thoroughly honest.