For many, starting and owning a business is a life goal. As exciting as the idea of being an entrepreneur might be, it involves a great deal of work and a process of transformation. To truly find success as an entrepreneur, you must first have a strong foundation for your business.
- Your entrepreneurial journey starts with a decision that you want to be an entrepreneur and then finding your great idea.
- Once you know your great idea, you have to plan out your business in detail to be sure it has a strong foundation.
- You can provide a strong foundation for your business by evaluating the target market, researching the competition, and defining your brand.
- Before you make your business legal, you need funding. There are several options for funding, including bootstrapping, money from family and friends, small business grants, and small business loans.
- Finally, take the leap and make it legal. Register your business with your state and you can start selling your products and services.
Ready to lay the groundwork for your small business? Here’s a look at the first eight steps you should take to become an entrepreneur.
Know If It’s Right For You
Entrepreneurship requires all of you. That’s why the first step of becoming a business owner is to perform a self-assessment and honestly decide whether it’s the right path for you.
To start, ask yourself these questions:
- Do you want to start a business? Why?
- What are your skills?
- What industries are you already familiar with?
- Do you want to provide a service or a product?
- What do you like to do?
- How much capital can you risk?
- Do you plan on working on your business full-time or part-time?
Choose The Right Idea
Once you’re sure that you want to take on being an entrepreneur, you have to have a great idea. Find your great idea by thinking about the things that suit your interests, personal goals, and natural abilities.
Once you have an idea, refine it with a Lean Plan. This is simply a written document that helps you to identify your mission and value proposition. This can provide structure for the more technical areas of your business formation.
Plan It Out
With an idea in mind, you need to create a plan to realize your dream. Begin by deciding on the simple things, like your business name and location. Make sure you’re following your state’s guidelines and regulations regarding names and locations. Also, be sure the decisions you make will resonate with your customers.
Next, you need to enter the product development stage. Identify a problem you can solve and what sets you apart from the competition. From there, you need to figure out how you’re going to market your product or service by identifying the target customers. Ask yourself how you plan to get their attention and convert potential customers into paying customers.
Finally, you need to consider whether you plan on partnering with someone and how you plan to get financing. Be very clear about how you will break even and how much that will cost. Most importantly, you need to know whether you plan on bootstrapping your business, whether you will be getting loans from family and friends, whether you will rely on federal business grants, and whether you will take out a small business loan.
Evaluate Target Market
By doing market analysis, you should be able to realize the following things:
- How fast people need your product or service
- What market size is
- How easy it will be to get a customer
- How long it will take to get to market
- How much you’ll need in an upfront investment
- How you will continue to stay relevant in the years to come.
Research The Competition
Competition can be intimidating but it’s actually a great sign that there’s a market for what you’re selling and you already have a blueprint for how to get customers. Learn everything you can about the competitor and their customers. See what works and what doesn’t then apply that to your business.
Define Your Brand
In today’s market, it’s not enough to have a great product. You have to stand for something. As you plan out your business, be sure that you know the following core components of your business:
- What your business will stand for
- What the core values of your business are
- What you can do to earn the target customer’s trust
You won’t be able to do anything with your business idea without the right funding. Luckily, there are a few options. First, you could bootstrap your business, meaning you fund it yourself. This could come from your personal savings or current income.
Another option is to receive loans and gifts from family and friends. If you are being loaned money, even by someone you’re close to, be sure to get a written agreement and payment plan that you both agree on.
You can also turn to the available small business grants. These are forms of business funding that you don’t have to pay back, funded by the government. Do your research to see which grants you qualify for.
Finally, you could rely on small business loans. While this adds debt to your company from the get-go, it can be a faster, easier way to get your company off the ground.
Make It Legal
The final step: take the plunge. Register your business with your state. Once you have your business license, you can proceed to sell your products and services to the masses. If you’re done all the work before this, it’ll be smooth sailing.