Things Every Entrepreneur Should Know When Getting Started
According to Entrepreneur, there are approximately 400 million entrepreneurs worldwide. And two out of every three people think entrepreneurship is a good idea. It’s impressive that entrepreneurship is so popular, considering that around half of new startups and businesses fail within the first few years regardless of industry.
According to analysis conducted by Statistic Brain, 46 percent of all new ventures fail due to “incompetence.” This may sound a bit harsh for new and bright-eyed entrepreneurs at first. But in reality, it’s a testament to how critical conducting research and a little bit of inquiry is to entrepreneurs before they get started. Fortunately, there are a few things you can do as an entrepreneur to set yourself up for success, so you can continue to remain one of those people who still think it’s a good idea.
Below are a few things every entrepreneur should know when getting started.
Solving a Market Need is Obligatory
Per research conducted by CB Insights, the number one reason startups and entrepreneurs fail is because they aren’t targeting or responding to a real market need. In fact, 42 percent of the startups they studied failed because they didn’t conduct an extensive competitive market analysis. Instead of responding to market needs, the entrepreneurs surveyed were trying to solve problems that they themselves found interesting.
A lot of entrepreneurs go into business to do something that they love, something that they’re passionate about. And, while this can sustain their work ethics for a prolonged period, it cannot guarantee the success of their ventures. It’s imperative that entrepreneurs also do their homework if they want their ventures to succeed. More than a “great idea” or “passion,” they need solid evidence that there is a real market need for what they want to create, sell, supply, or offer.
When getting started as an entrepreneur, don’t forget about your potential customers and what they really want. Because if you’re not providing something people really want, they won’t buy anything from you regardless of how passionate you are. Before you even build a website, conduct a competitive market analysis to uncover what is lacking in your desired industry and how you can fill the void or enhance your prospective customers’ experiences.
For instance, if you want to sell organic cosmetics, find out what’s already out there and what your potential customers are asking for from your competitors. Do your potential customers want more affordable shipping options, better or different packaging, more product selections, etc.? Are they interested in receiving a monthly subscription of cosmetics? Would they be more willing to buy organic cosmetics if a small portion of sales went to a nonprofit that supports organic farmers? Do some digging to see how your venture can be successful within the niche that you love. To learn the ins and outs of conducting a competitive market analysis, review this detailed post published by Big Commerce.
How to Secure and Manage Funding
The number two reason entrepreneurs fail is because they run out of funding (CB Insights). This is due to entrepreneurs either not managing their funds well, or not knowing where they can go to secure the funds they need. Even though over 80 percent of entrepreneurs fund their own ventures, there are a lot of different ways entrepreneurs can secure funding in 2018, especially if they’re in one of the top three funded industries – software, media/entertainment, and biotechnology (Entrepreneur).
Here are a few different ways you can secure more funding as an entrepreneur:
- Start a crowdfunding campaign
- Convince venture capitalists to fund your venture
- Apply for government funds and programs
- Take out a bank loan or line of credit
- Ask friends and family for funds
Be sure to have a detailed business plan ready when funders ask you what you’re going to do with all the money they’re giving you, especially if it’s money you must pay back with interest. And don’t forget to hire a certified public accountant (even if on a retainer basis) to help you manage and potentially invest your funds. You’ll always want to know how much money you have and what it’s being spent on every day, so you can guarantee a high return on investment regardless of where the funds are coming from. Create a budget plan and shop around for the best funding options when getting started.
You Need to Surround Yourself with the Right People
The number three reason entrepreneurs fail is because they don’t have the right team in place (CB Insights). As an entrepreneur, it’s essential to hire people who have different skills than you do. If you’re not that great at marketing, then find someone who is. If you’re disorganized, find someone who is very organized, and so on. Be sure to build the team you need to succeed. Not every business requires the same level of personnel, so understand what functions your venture needs as it grows. And if you’re building a venture solo or are not yet to the point where you require a staff, know where you need to outsource and who you can call on when you need help or advice.
When you get to the point of building an advisory board or board of directors, hire people who make up for the background and experience you lack. Also, be sure to include different personalities that complement one another. For instance, while it may seem great to be surrounded by only people who are highly energetic and outgoing, there is a benefit to having someone on your staff who is more laid back and strategic.
When you outsource tasks or responsibilities properly or hire the right staff, you won’t have to work a lot of extra hours or micromanage every small detail of your venture. On the other hand, if you try to always do everything yourself, you’ll only burn out faster and won’t be able to expand your operations when the time is right.
Taking Care of Yourself and Your Personal Life Allows You to Remain Resilient
A lot of new entrepreneurs take pride in working over fifty or sixty hours a week. However, the goal shouldn’t be to work more hours, but to work smarter and more efficiently during the hours in which you work. When getting started, know how you’re going to maintain a work-life balance.
Currently, 70 percent of entrepreneurs are married and most of them have families to support (Entrepreneur). Inevitably, their attentions will be pulled away from their new ventures to personal concerns and responsibilities. Be sure you know how you’re going to make time for your personal life as an entrepreneur.
In addition, make time for yourself to bounce back from setbacks and disappointments. They’re expected as an entrepreneur, and you’ll need to have a strategy for how you’re going to “sharpen your axe” when they happen, so you’ll remain resilient and focused. Whether you need extra sleep, a hobby not related to your venture, or something else, figure out what helps you relieve stress and “get back on the horse” when things get tough.
Distinguishing What Technology and Tools You Will Need is Essential
In addition to surrounding yourself with the right people, you’ll need to surround yourself with the right technology and tools as a new entrepreneur. Here are a few different types of technology you might want to consider as an entrepreneur, especially if you’re flying solo or have a small staff. Most of them are even free to use.
- Project management tools like Trello or Asana
- Google Drive for document and file sharing
- Invoicing and payment processing software like Wave or FreshBooks
- Conferencing platforms like Join.me or Zoom
- All-in-One small business solutions like 17Hats
- E-commerce platforms like Shopify
Building a Beautiful and Functional Website is Necessary, but Easy
In 2018, no one will know about your business or venture if you don’t build a website. And luckily, building your own website in 2018 isn’t hard at all and doesn’t require you to spend a ton of money. When building your website, select a service that:
- Has an easy-to-use website builder with drag-and-drop features and mobile-friendly templates.
- Allows you to register your domain for free, and add unlimited domains as needed.
- Includes free email addresses and ad credits.
- Offers additional search engine optimization features and marketing services.
- Permits you to build an e-commerce site.
- Is safe and secure 24/7 and provides you with the support you need.
There’s a lot to keep in mind when getting started as an entrepreneur. Be sure to keep everything mentioned here in mind as you move forward, and you’ll be one step closer to realizing your entrepreneurial aspirations.