Many people have found that trying their hands on entrepreneurship can be very educational and challenging. Being able to make a business grow and thrive is a kind of success that gives great pride to any businessman. No wonder then that after making a successful business debut, many entrepreneurs would want to give another business idea a go.

Having multiple businesses not challenges the mind and skill of an entrepreneur, it also provides a new avenue that would either complement the previous business, or make way for another idea that’s closest to the heart of the businessman. Here’s an example: a street artist might make a successful living out of designing graphic shirts, but might eventually want to venture into selling street art-themed paintings in the long run – an option that might not seem very profitable, but is what the artist’s passion is. His second business is also complementary of his first one.

In the case above, having multiple businesses is a win-win situation. The artist gets to pursue what he really likes doing, while not having to worry if it would be profitable enough, because he has a rock-solid t-shirt design business. He also won’t have to hire people with very different skill sets to run both businesses because both are closely related, and also doesn’t need greatly-varied venues and equipment. In the end, the artist would be able to generate extra income through the introduction of a new, complementary business line without much added cost and labor strain.

But maintaining multiple businesses at the same time has its repercussions, too. Say the street art business picks up and starts demanding more attention; the artist, then, runs the risk of spreading himself too thin if he isn’t able to find someone competent and trustworthy who will help him manage the two businesses. Mismanaging either one of may cause the business to fail.

Here’s another situation: what if the artist decided to have a small motorcycle repair shop instead, and the shop is located far from the design shop? There is a tendency for him to not be able to watch over the two businesses properly because of the distance of the two businesses. Aside from that, he would also need a different set of equipment for his second business, as well as dedicated mechanics. By that time, he would be risking a big amount of business capital on his new venture.

The bottom-line is, there are great advantages to having multiple businesses, but there are also risks. Businesses, whether big or small, require a lot of thought, planning and analyzing. Unless the entrepreneur is aware of the possible difficulties and how to handle them, it is not ideal to have multiple businesses. However, if the entrepreneur is prepared enough, it is suggested that he first makes sure that the original business is stable enough before he dives into a new one.  

Amy C. Fountain is a writer who likes to help budding entrepreneurs on their ventures by providing tips and sharing her experiences. She is a businesswoman who owns a couple of websites that help people make use of Accent Tables and Japanese Bamboo Fountains for decorative and relaxation purposes.