You have an idea that you are sure will take off. You’re ready to take the next step to go from just an idea to an actual business. You’ve googled “How to start a business” but aren’t quite sure what steps to take first. Where do you start?
In 2014, 80% of small businesses made it to the next year. Your business can make it past year one too. Here are four things you need to consider as you start your new business.
Your idea could be the next big thing, but if you haven’t done the proper research to gather information about your target audience and competition you won’t be able to get it off the ground. Market Research is extremely important in the first stages of a new business. It will help you to find your audience and potential customers. Knowing your target audience from the start will help you to save time and money as you’ll be able to focus on getting your message and product to those who are most receptive.
Every entrepreneur knows you can’t start a business without money. When you search “how to start a business”, funding is one of the most important steps that always pops up. Since money trees haven’t been invented yet (at least ones with actual currency), you’ll have to try a few different options to raise the funds necessary to launch and keep your business running smoothly.
- Bootstrapping: Many entrepreneurs start by self-funding their business, also known as bootstrapping. This could be done by using saved funds, tapping into retirement savings, or taking a part-time job. You may also forgo a salary for an amount of time to keep that money in the business.
- Crowdfunding: This tactic for funding a business has become hugely popular as of late. Crowdfunding is when individuals invest or donate to new businesses and receive a product or service in return. If you already have a stock of product prepared or a service to render, this can be a great way to raise funds.
- Business Partner: Similar to bootstrapping, finding a business partner who can also invest in the business is another way to fund your venture. It can also help in the long run to have more hands to run your business and have more connections to network with.
- Investors: Finding investors is something most entrepreneurs are constantly working towards. If you’re lucky enough to find a reliable investor early on in your business venture, this can make a huge difference for you financially. You just need to be ready to show potential investors how your business will be successful and why it’s worth it for them to invest in you.
When figuring out how to start a business, your business plan will be the foundation. It will help you know where to focus, what goals to work towards and how to grow. It may seem like a simple tactic, but a plan has the potential to make a huge impact on your success, especially in the beginning. Take the time to write out a detailed business plan and then ensure that anyone working with you is familiar with and understands the plan.
Ensuring that you have considered all of the legal elements early on in your business venture will save you a lot of time and potential frustration. Do the proper research per your business to make sure that you have covered all of your legal bases. This includes registering your business, obtaining the proper permits and licensing, getting federal and state tax ids, and more. It may be worth it to talk with a legal professional to ensure that you have taken all of the proper steps.
Being an entrepreneur is no easy task. But if you’ve covered at least these four elements, then you are off to a good start. Follow Rafferty Pendery for advice every day on how to start a business, avoiding entrepreneur mistakes, how to succeed as a tech entrepreneur and more.