In today’s economic climate, many people are choosing the entrepreneurial route instead of making their living as an employee.
Why is entrepreneurship important in today’s world and why are so many people now entering the entrepreneurial sphere?
The importance of entrepreneurship in today’s world has a great deal to do with the wider availability of resources for entrepreneurs in the information age, empowering people to learn the crucial steps towards starting their own business online.
There are countless learning resources across platforms such as YouTube and Spotify that help give people an understanding of what makes a successful entrepreneurial venture.
Additionally, the benefits of entrepreneurship are undeniable: the opportunity to work remotely, be your own boss, set your own working hours, and to work towards something that is important to you personally.
Just because you decide to embark on an entrepreneurial venture does not necessarily mean that you are going to succeed.
Many aspiring entrepreneurs have found that they were unprepared for all that is required of a successful business owner.
It is important to know exactly you are getting yourself into before you make the switch into the world of entrepreneurship.
Before you quit your job and attempt to build your own company from the ground up, here is everything you ever needed to know about entrepreneurship.
Table of Contents
- Deciding if the entrepreneurial lifestyle is for you
- Learning to think like an entrepreneur
- Building your network
- Planning your entrepreneurial venture
- Obtaining funding for your venture
Deciding if the entrepreneurial lifestyle is for you
The advantages of entrepreneurship, if you are successful at it, can be great. No more boss telling you what to do, no more worrying about showing up to the office 5 minutes late, and no more spending hours working on something that isn’t dear to you.
Before you begin your new business venture, be sure to do some research into the experiences and lifestyles of successful entrepreneurs. Some of what you read may enlighten you to what being an entrepreneur actually requires.
Here are some characteristics of entrepreneurship that often get overlooked:
- It’s going to feel like work. Many people assume that because they are starting a company centered around what they love, that it will not feel like work. It will. Being an entrepreneur means working long hours, doing the paperwork, and struggling to get your business off the ground. Even if you are extremely passionate about what your business provides, there will be times when it feels like work.
- The money won’t come automatically. Some who are new to the world of entrepreneurship think that if they have a great business idea and execute it well, that the money will start to come in only a matter of months. This is most often not the case. Many businesses operate at a loss for a matter of years before they turn profitable. And what this means for you is that you may have to put more money into your business before you get any return on your initial investment.
- You have to be the boss. This doesn’t really apply to freelancers or people who are planning on opening mom-and-pop shops run by the family. However, if you plan to scale your business and hire employees, you are going to have to manage those employees. Many people don’t consider this when they are starting a business; but the truth is, if you aren’t able to be a leader, you aren’t ready to start a business that employs people. Being able to manage the different personalities of different employees and create an environment of job satisfaction and productivity is a task that is greatly underestimated by many new business owners. Before you try to build the next billion-dollar startup, ask yourself if you’re ready to be the leader of such a company.
Learning to think like an entrepreneur
One of the most important steps towards becoming an independent entrepreneur is learning how to think and speak like an entrepreneur.
Successful entrepreneurs are opportunists. Opportunists that wake up early. Real early.
They are up to date with current trends and view those trends as valuable information for identifying money-making opportunities.
If you keep yourself updated on what’s going on in the world, you may find yourself formulating new ideas about what type of business can be successful in the current economic climate.
But understanding the world around you is not enough, entrepreneurs need to be creative.
Many entrepreneurs find their business ideas by looking at existing products and thinking about ways they can improve them, or thinking about problems in their own lives that could be solved with a new product.
Talk to your friends and family. Gauge what sorts of problems they encounter in their daily lives and try to formulate ways that you could solve these problems. Oftentimes the answer can be very simple.
Successful entrepreneurs are decisive and confident.
Procrastination and self-doubt are enemies of the entrepreneurial spirit. If you aren’t the biggest believer in your business, no one else is going to be.
There are inevitably times in every entrepreneurial venture where things get difficult and the future doesn’t look quite as promising as you thought it would.
A successful entrepreneur remains confident in their business and pushes through these difficult times. The only way to move your business in the right direction is to be proactive.
Make the difficult decisions when they have to be made, and don’t put things off because they’re difficult to deal with.
Building your network
An important characteristic of a successful entrepreneur is the ability to build a strong network of people who will help you throughout your venture.
Curating a contact list of potential clients, advisors, lawyers, and investors will be of huge help in the future.
The people in your network are the early adopters and brand ambassadors that are going to help spread the word about your business to the general population.
Attending networking events and community gatherings are great ways to expand your network, and leveraging social media platforms such as LinkedIn, Instagram, Facebook, and Twitter can help you build a network that expands beyond your geographic region.
Planning your entrepreneurial venture
Once you come up with an idea for your entrepreneurial venture, have decided that the life of an entrepreneur is something you’re interested in, and have begun to build your network, it’s time to start your business plan.
Here are some of the crucial steps to remember when creating your business plan:
- Conduct market research. Researching the market into which you plan to enter is essential to building a successful business. Getting a good feel for your target customers helps you more pointedly market your product and gain rapport within your market sector. Understanding the competitors in your space can help you to differentiate yourself from these competitors and find your niche. This type of information can be found only through comprehensive market research. You may have a profitable idea, but it means nothing unless you can identify the proper target market to which you can sell your idea.
- Choose a location. Location is extremely important to any type of business, even app developers. There is a reason so many big tech companies are located in Silicon Valley, it’s because the culture and availability of quality employees in this region allows these companies to be successful. If you are planning to have a physical storefront, then location is all the more important. Establishing that there is a demand for your product in the geographic region in which you are located is extremely important.
- Formulate a marketing strategy. In today’s economy, marketing is equally, if not more, important than developing an innovative product. Nike has not risen to the level of success it has today simply by producing the best running shoes. The genius of the Nike brand is that it makes you think that their shoes are the best. Creating a marketing strategy that appeals to your target market is the only way to connect consumers with your product.
- Formulate an operational strategy. Once you develop a brand, you need to deliver on the promises you make in your marketing campaign with operational execution. This means streamlining your supply chain, making your distribution network as fast as possible, and ensuring that the quality of your product is the best it can be. Meeting demand in a time-efficient and reliable way is a keystone attribute of successful companies.
Obtaining funding for your venture
Unless you have the capital in your own bank account to finance your business, you will probably have to find some source of external funding.
Many small businesses are financed exclusively by personal finances and friends and family.
However, if you plan to build a business that requires higher levels of capital, there are other options.
Bank loans have historically been a reliable way to gain financing for small businesses, but they typically require some form of collateral.
Angel investors are another way to finance your business, but this usually involves giving up a piece of your equity.
Venture capital firms can be a source of capital for entrepreneurs; however, they typically do not give out loans to companies who have not proven their value by demonstrating that they can generate revenues.
If you are just starting your business, this is probably not a viable option.
Another method of capital-generation that is increasingly being used by startups today is crowdfunding.
This method is debt-free and does not require you to sacrifice any of your equity.
Do the research and find out what the most practical way for you to obtain the funds you need is.
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