How to Become an Entrepreneur
Deciding to pursue entrepreneurship is one
step, but knowing how to become an entrepreneur and deciding how to start a
small business is another. There are a great number of steps
involved, and while it may seem overwhelming, by following these steps you’ll
know where to focus your energy.
Find a business idea
Running your own business is hard work and
could mean working long days and nights with little vacation. The first step is
to find something you’re interested in working with, since you’ll be dedicating
so many working hours to it.
Beyond something interesting or exciting to
you, research emerging trends in business or find a need not being met. Finding
a product or service solution that you’re passionate about and solves someone’s
pain point is a winning formula for entrepreneurs. You can also look to
emerging startups for inspiration and to see what business sectors are growing.
Remember, your business idea does not have to
be an invention or something no one has ever seen before. If it meets an
underserved demand or you can make it easier or cheaper, then you have the
start of a great idea. Researching the competition will help you articulate
this idea even further.
Decide if you need to get extra education or professional training to make your idea come to life
A college education may not be required to
become an entrepreneur, but there may be additional educational or training
necessary to solidify your business idea. Be sure to research what educational
requirements would be most beneficial to your business, such as coding classes
for web development or
Get your product developed
Once you hone in on a product or service, you
need to develop a product plan. You’ll see this referred to as a minimum viable
product, or MVP, for short. Not only is this where you flush out the ideas for
your product, you may even test it with a small sample of people during this stage.
You’ll develop the features of the product and make sure they align with your
overall business goals.
Validate your product
Validation of your product or service occurs
when you test out your product to make sure there is a viable market for it.
Who wants to launch a great product if there’s no demand for it? While this
phase takes many steps, ultimately you need to make sales to ensure your
product is validated.
To move forward with a product idea, take the
following steps:
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Focus on making a few initial
sales, so you have feedback to work with.
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Understand your competition
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Research the current demand
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Consider raising money with a
crowdfunding campaign
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Talk directly with your customers
●
Tweak product selection or idea
based on the sales and feedback you receive
Create a business plan
If you’re seeking funding from outside sources, most likely you’ll be required to present a business plan. Whether you are obtaining funding or not, a business owner should always create one before launching. This includes details of your business goals, objectives, clients or audience, strengths and weaknesses, plus the competitive landscape. Although a business plan can be updated as you grow, it should provide an overview of how your business will operate.
Consider getting a co-founder
Another decision to make for an entrepreneur
is if you should take on a co-founder. There are many positive aspects to
including one in your business plan. For starters, it could be a strong
emotional support system for you, which you may need more when you’re starting
out. It also presents a more professional front as you’re networking or asking
for funding. And if the co-founder has different strengths and weaknesses than
you, it could provide a much needed balance to business operations.
But there are risks of getting a co-founder
too. This means your sharing equity, which may not align with your income
goals. There’s also the risk of conflict, since you’re working with differences
in personality, work ethic, and operational skills. If you do choose to include
a co-founder, look at your existing network for inspiration first. If you don’t
know anyone, start asking around and interview candidates if necessary, or
consider the help of a co-founder matching service.
Secure funding for your startup
You’ll need to secure funding if you want to
know how to become a successful entrepreneur and get your company off the
ground. This funding could come from several sources, including your own
savings, investments from family and friends, or donations. You might want to
begin by looking into how to raise
capital for a startup.
You could consider a small business loan too, such as through a bank, a Small Business Administration (SBA) loan, or with online lenders. Other loan options include:
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Venture capital funding, which is funding provided by banks and investors for businesses they feel have long-term growth potential.
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Crowdfunding, where you raise money from a large number of people over the internet, in exchange for a determined amount of equity.
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Angel investors. These are often the precursor to venture capitalists and provide funding when most others won’t invest right away. Typically this is in exchange for equity.
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Business credit cards
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Microloans, which are smaller loans from alternative lenders.
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Small business grants
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Bootstrapping with you brown savings
Launch your business
Once your ideas and funding are lined up then
it’s time to officially launch your business! Marketing is key, so your
potential customers know you exist. Your marketing efforts will depend on your
client’s persona and product type. This could range from digital marketing
efforts to developing brand recognition online and through social media.
Even when you launch your product or service, you’ll have to keep working to keep building and improving. Networking with professionals, conducting your own independent research, and enrolling in entrepreneurial courses and training are a few ideas for keeping up-to-date with industry trends and happenings.
What do you Need to Become an Entrepreneur?
One reason why entrepreneurship is so
intriguing is because you don’t need any special degrees or certifications to
become one. While a degree in related fields such as business or economics
would be beneficial, they certainly aren’t required.
Can I Become An Entrepreneur With No Money?
You can become an entrepreneur with no money of your own but you may need some sort of funding. Many would-be entrepreneurs rely on family and friends for initial investments, possibly in exchange for partial ownership. It’s also possible to take on a personal loan, or even donations, as a revenue source.
Do You Need A Business License?
You might have asked yourself the question “do I need a business license?” Depending on both the state where you live and the industry you work you may need to purchase a business license. You should be able to locate specific information with your state’s Department of Revenue.How Much Do Entrepreneurs Make?
The average salary for entrepreneurs is $70,126 annually, according to Indeed.com. Bear in mind this is only an average and the amount you make depends on the type of business, location, and myriad of other factors. You may make more or less — if you are able to draw a salary at all.Tips On Becoming A Successful Entrepreneur
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Never stop growing — look for learning and networking opportunities all around you, including:
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SBA learning center
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Business Hubs
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Trade/Professional Associations and Business Groups
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Support Networks
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Consider hiring a business coach or consultant. A business coach assists you as the owner through all aspects of managing the business, including defining and achieving goals. A business consultant advises you for one specific area of your business.
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Find and attend entrepreneur events to expand your network, make connections, and inspire your own creativity.
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Look for mentorship opportunities with people you trust, especially leaders in your industry or whose values you identify with.
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Identify your goals early on. Write your goals down and put them in a place where you regularly see them. This helps you stay focused on the “bigger picture” when you face obstacles.
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Include self-care in your routine. It’s easy to overlook your own needs when running a business, but taking care of your mind and body makes you a better business owner. Regularly exercising, long walks, healthy eating habits, and engaging in other hobbies are a great way to create a strong work-life balance.
What To Avoid On Your Way To Entrepreneurship
While your road to entrepreneurship looks different than anyone else’s, there are a few things you would be wise to avoid or keep in mind.
- Avoid taking on too many debts. This is similar to your personal finances and business owners would be wise to avoid as much debt as possible with their business, especially when starting out.
- Avoid trying to do everything on your own. Hiring capable managers or outsourcing tasks to experts may be the best way to scale your business. Plus it allows you to focus on your strengths, rather than trying to take on every responsibility.
- Don’t rely on one income source. Diversifying income sources is a smart approach, especially for entrepreneurs. The old expression “don’t put all your eggs in one basket” holds true here - by operating multiple streams of income, you protect your finances even if some of your income is slow to come in, you have trouble with a client, or your business is in a state of transition.
Conclusion
While entrepreneurship is not always an easy choice, if done wisely, it could be a fruitful and satisfying career path for life.
