If you’ve ever thought about striking out on your own and becoming your own boss, you’ve probably wondered, “How do you become an entrepreneur?” The answer is “with a lot of sweat, toil and hard work.” Fortunately, it’s not as hard as it may seem if you go about it the right way. And when you succeed, the rewards make it more than worth the effort.
How to Become an Entrepreneur
Becoming an entrepreneur starts with finding the right business for you. In fact, selecting a field to work in or a specific type of business to run could well be the most important decision you make as an entrepreneur.
Starting a business from scratch takes a lot of hard work. It involves a lot of financial risks. More than anything, it takes commitment. You will encounter obstacles and adversity along the way, and there will be times when you wonder if all the long hours and uncertainty are worth it.
So here’s rule #1 for how to get started as an entrepreneur: find a field of business you really care about. It can be anything as long as you have a strong interest in it and your product or service provides value to customers. When times get tough, having a real passion for what you do will carry you through.
How do you know which type of business is right for you? Here are three ways to approach this important decision:
• Do what you know. Look at your work history, identify what you liked doing the best, and what you do well. Then think about how you could turn your skills and experience into a successful business.
• Do what others do. Entrepreneurship doesn’t necessarily mean coming up with a product no one has thought of before. In fact, those businesses are a rare exception. Instead, identify a successful business that interests you and see if you can find a niche within that market.
• Solve a common problem. Look for an industry or field where you see a gap in the market, then figure out a way to fill it. This approach requires research to learn what customers want but don’t currently do. It’s also riskier than the first two approaches above. But if you find a need and a way to fill it, it can also be the most successful.
It helps to have experience in the area you choose, but it isn’t a must. Give yourself permission to explore areas you may not have worked in but have always interested you. Whatever type of business you decide to start, make sure it adds real value to customers. If not, people won’t pay attention to it.
Steps to Becoming an Entrepreneur
Once you know what your business will be, here’s how to become an entrepreneur in six steps.
1. Plan your business.
When becoming an entrepreneur, a business plan is your blueprint for success. At the “big picture” level, a business plan defines your objectives for the business and your strategy for achieving them. It provides clarity, focus, and direction. It can also attract people who have the skills and expertise you need to work for your fledgling enterprise.
A business plan can be as short or long as you want to make it. Some entrepreneurs like a lot of detail; others put it all on one page. Either way, be sure to answer these four questions:
• What am I building?
• Who will be my target market?
• What promise am I making to customers with my product or service?
• What are the steps I will take to achieve my goals?
2. Line up the funds to run your business.
If you don’t have enough personal savings or credit cards, you will need to raise funds to launch your business. The amount will depend on the type of business you plan to run. Is your goal to run a lifestyle business, one that supports a comfortable living without a lot of growth? Or, are you looking to build a large company that you can sell for a substantial profit? These and other factors will determine how much money you need to raise and what kind (i.e. debt or equity).
3. Know your customer base.
Before you spend any money on the business, find out if people will actually buy your product or service. This involves becoming crystal clear on who your customers will be and why they would buy from you. What problem(s) will you solve for them? How will you save them time or money? How will you make their lives better in some way?
Knowing your customer base involves research into key demographics such as age, income, education level, where they live, and more. The Internet offers a treasure trove of industry and demographic data. You can also gain valuable information by reading trade magazines and industry publications. However, the best information you will get comes from talking directly with your customer base and listening closely to what they say.
4. Start building a network.
Before you can launch a business, you need to raise funds and hire people. Networking is an effective way to do both. It can help you find people with the right skills and experience to work in the business. It can help locate investors, advisors, vendors and supporters to help your new business get off the ground. Networking can also identify potential customers.
Networking used to consist mainly of attending live events like trade shows and Chamber of Commerce meetings. These days, social networks like Facebook and LinkedIn make it easy to network locally, regionally, and nationally. There are also online companies that specialize in helping entrepreneurs launch their businesses. These sites can be a great networking source while also providing the opportunity to get mentored by experienced entrepreneurs.
5. Market your business.
Marketing is the process of introducing people to your product or service and explaining why it is the best solution for their problem or need. This involves communicating what makes your product unique, different and better than the competition.
Marketing can be grassroots or highly professional. Your approach will depend on your budget and your knowledge, if any, of marketing tools and techniques. The cheapest and most effective way to market your new business is online. This starts with having a website but includes other tools:
• Search engine optimization (SEO, to rank high on search engines)
• Email campaigns
• Posting blogs and articles that provide value to readers
• Social media marketing, such as a Facebook and LinkedIn page
• Targeted banner ads on websites your customers are likely to visit
The Internet is full of websites that offer articles and tutorials on how to market your business. There are also many excellent books available that discuss how to market a business on a budget. There are also firms that will do your marketing for you. Whichever path you take, know this: marketing needs to be ongoing to sustain your business over the long term.
Marketing also means becoming an ambassador for your new business. Talk about your company everywhere you go. Get involved in local civic activities. Focus on serving others. Constantly think about how your business can help others succeed or improve their lives in some way. When you focus on providing value, the customers will come.
6. Tap into resources for entrepreneurs.
Becoming an entrepreneur doesn’t mean you have to go it alone. There are many different resources available to help you succeed. For example, Score – a free counseling service for entrepreneurs, or the Small Business Administration, which offers information and programs for people looking to start a business. There are also many good software tools to help grow your business. These include G Suite, which combines all of Google’s online tools into one program, and Microsoft Office, another set of tools for tracking and analyzing business data.
Franchising – The Safer Entrepreneurial Option
These days, franchising allows you to become an entrepreneur without starting your own business. It involves buying a ready-made business and operating it as the sole owner. You have to abide by guidelines established by the franchisor, but you get a recognized and established brand and business model that works right from the start.
Advantages of buying a franchise include:
• Extensive training and support
• Less financial risk
• A network of franchisees to share ideas and best practices
• Instant brand recognition from an established customer base
• Less startup work
• You still get to be your own boss
Entrepreneurship isn’t for everyone but for those who prefer to walk the less-traveled path, it can offer a challenging, interesting and highly rewarding career.