5 Tips for Starting a Business
I remember sitting in my cubicle and dreaming of the day I would be my own boss. I had visions of rolling out of bed whenever I wanted, taking a midday spin class (insert laughter here), grabbing lunch with the ladies, taking long vacations, and working sometime in-between. No one would tell me what to do or where I had to be. I would have it made.
Or so I thought.
Reality hit like a ton of (soul crushing) bricks. I realized that as a business owner, I still had to work business hours, weekends, after-hours, and vacations. And even if I am sitting on a beach, it’s impossible to completely check out. My business is like my first-born child. Whether I am giving it what it needs and whether it’s growing into the strong and healthy business I know it can be, it is always on my mind. But, just like a baby, the sleepless nights, proverbial temper tantrums, and constant care also offer some of life’s very best rewards. I can take the occasional lunch with my girlfriends, I’ve been known to go to the spa on a whim, I never have to track my vacation days and nothing compares to the sense of accomplishment I get when my business is succeeding. I have yet to take a midday spin class, but it could happen someday. Being my own boss is one of the most empowering things I’ve ever experienced.
Every minute I’ve put into it has been worth it. Working for yourself is not for everyone. It’s not better or worse than working for someone else, and it’s definitely not for the faint of heart. According to businessinsider.com, 50 to 70 percent of small businesses fail in the first 18 months. Becoming an entrepreneur is riddled with risk, but according to that same article, almost all entrepreneurs say the risk is worth it. If you find yourself aching to take that risk, then here are five steps to getting your new business started.
1. Ask the hard questions.
Immediate gratification is the name of the game these days, but when you're starting a business you must take time to prove to yourself and your skeptics that you have a good idea. Take a couple months to watch the market, do your research and ask those tough questions... Is there a void that I am filling? Can I make money? How will I make money? Who are my competitors and what makes me different?
The answers to these questions might be hard to swallow, but knowing these key points could make all the difference. They will also help you hone your concept. Be prepared to strip your idea to its very core and don’t be afraid to make changes that will give you the best chance of success.
2. Overestimate time and cost.
Estimate the time, effort, and money it will take to start a business, then double it and add 10% for good measure. It probably sounds like a given, but starting your own business will most likely be the hardest work you ever do. For the first while it will feel like you eat, sleep, and breath your business, and that's probably because you will.
It’s best to start a business with a solid backup plan, whether that’s your day job, a healthy savings account, or a partner who has a steady income. The other problem many entrepreneurs run into is how long it takes to get things off the ground. It will probably take longer than you think before you start making money, so don’t gamble it all without a safety net. I know this isn’t always possible, so if you do risk it all, don’t be afraid to wait it out until you see the rewards!
3. Do the paperwork.
And here is the unglamorous side of owning your own business. Business licenses, taxes, accounting, and spreadsheets are not fun; but it’s so much better to get these things in order before the IRS starts banging down your door (which happens sooner than you think!). There are a lot of variables when it comes to the legalities of opening a business, but here are some basic guidelines:
- Determine business structure. The structure of your business will dictate who you need to register with and what documents you’ll need. Some of the main options are sole-proprietorship, LLC, corporation, or partnership.
- Register with the IRS. If you have employees, business partnerships, or are a corporation, you need to register with the IRS and get a Employer Identification Number (known as “EIN”).
- Register with your State or Revenue Office. Yippee, more taxes! Every state is different, but you will need to register your business on a local level. You might also need a tax permit.
- Get a business license. No matter how small your new business is, you will still need a business license. The type of license and permit will vary greatly depending on what you will be doing. The good news is that getting one is usually inexpensive and fairly straightforward. You can go to SBA.gov and search based on your zip code and type of business, and it will tell you exactly what you need.
- Meet with your accountant. You can probably Google your way through the tax jungle, but I think it’s safer and easier just to schedule a meeting with an accountant and have them fill you in on what taxes you will have to pay and how you pay them. Getting everything setup correctly will save your a lot of stress down the line.
- Check out SBA.gov for more information.
4. Envision success, but be ready for setbacks.
Being confident in your idea is definitely the first step to making your business a success, but you have to be prepared to face challenges, and likely ones you don’t see coming. The important thing to remember is that just because there are bumps in the road doesn't mean you have failed. Entrepreneurs earn their stripes by accepting, overcoming, and flourishing in the midst of these challenges.
5. Sell, sell, sell.
Maybe you’ve never thought of yourself as a salesperson. Maybe the very word “sales” makes you cringe. But sales are a necessary part of starting a business. Whether you have to sell to customers, advertisers, investors, or your Facebook fans, you will have to find a way to package and present the benefits of what you do. This doesn’t mean you have to pick up the phone and start cold calling, it just means you need to be your brand’s best ambassador and spokesperson.
Sheryl Sandberg wisely said, “There is no perfect fit when you're looking for the next big thing to do. You have to take opportunities and make an opportunity fit for you, rather than the other way around. The ability to learn is the most important quality a leader can have.” Even though the road to entrepreneurship is a steep one, it’s also one that most business owners would say is 100% worth the hike.
If you find yourself dreaming of starting a business, ask yourself what’s holding you back. Do you have an amazing idea? Something you've always wanted to do? Will you regret not taking the plunge?
image via Domino Magazine