The path to entrepreneurship is paved with challenges. It is a route that will make or break you. However, when the going gets tough, you need to stay strong.
About 90% of startups tend to fail. The main reason why startups fail is that they do not plan. There are many things that need to be considered when you decide to become an entrepreneur.
The moment you start working on your idea, the workload would quickly pile up. Instead of panicking and not knowing what to do, we have prepared the perfect post that will help you start your journey right. Read on to learn about what you need to do as an entrepreneur.
1. Refine Your Idea
The first thing that you need to do when you embark on an entrepreneurial journey is to refine your idea. You might already have an idea about what you would like to sell. However, it is important to perform a quick search into current companies in the desired industry.
Take a look at the brand leaders and find out how you can do a better job. Only when you think your business has something unique to offer or you can deliver something for less can you move on to crafting a business plan. Identify your “why” to refine the business idea.
2. Craft a Business Plan
Once you have an idea about what you want to do, you can craft a business plan to put your idea to the test. To write the perfect business plan, you need to consider the purpose of the business, the target audience, the startup costs, and your end goals.
A well-written business plan can even help you get funding. New businesses tend to make a lot of mistakes rushing through things without carefully thinking about their business. You must find out who your target customer base would be, what product or service they would purchase, and if there is demand.
When writing the business plan, you need to conduct market research to look into your potential clientele. It will help you understand the needs and preferences of your customers.
3. Assess Your Finances
The startup route to entrepreneurship requires money. Every business idea has a price. Therefore, you need to think about whether you can cover the costs or not. Can you fund the startup on your own, or will you need to borrow money?
If you are leaving your existing job to take on the work full-time, you will also need to consider the money you will need to support yourself until you end up making a profit. Getting an idea about the startup costs will help you get started on the right foot.
It is common for startups to fail because they lack the money. It is always better to overestimate the capital needed to run the startup than to underestimate it. You should perform a breakeven analysis to determine how much money you need to make to break-even.
Today, there are plenty of funding options that you can take advantage of, such as business loans, business grants, venture capitalists, and crowdfunding.
4. Determine the Legal Business Structure
The legal business structure is something that you should be aware of early on. You must choose the right legal business structure and register your company.
Remember, the business structure you choose would affect you legally in terms of liability and how you file taxes. You have the following options.
- Sole Proprietor: Anyone wanting to own the business on their own would need to register as a sole proprietor. However, you should be warned about personal liability.
- Partnership: If you want to create a startup with your friends, you should consider opting for a business partnership. It involves two or more people where you get to decide the terms and conditions mutually.
- Corporation: To benefit from company liability and avoid personal liability, you can register your startup as a corporation.
5. Register with the IRS
Once you have determined your legal business structure, you need to register your business with the IRS. You will need to get different business licenses before being able to operate the business legally. For instance, you must register with local, state, and federal governments.
To register the business, you will need several documents such as operating agreements, articles of incorporation, and employer identification number.
After you have registered your startup, you will need to pay tax at the end of the tax year. However, you might not need to pay tax initially as there are plenty of tax credits for new startups.
6. Create a Team
Unless you want to run the entire business on your own, you will need to create a team. You would need to hire a great team by recruiting the best talent. The team would help the business take off and ease your startup route to entrepreneurship.
The product or service that you want to provide would be created by people. Hence, you need to find the best team that you can easily work with. You must define roles and responsibilities early on to take the stress away.
7. Create a Brand
To get people to take an interest in what you have to offer, you must create a brand. Focus on the following to establish your brand and get people talking.
- Develop a company website to get your message across.
- Make a social media account on different platforms such as Instagram, Facebook, Twitter, and TikTok.
- Use CRM software.
- Create a company logo.
Become a Successful Entrepreneur
Once you have finished reading this post, you will know everything about the startup route to entrepreneurship. By considering the tips mentioned above, you will become a successful entrepreneur in no time.
Shoaib provides ghostwriting and copywriting services. His educational background in the technical field and business studies helps him in tackling topics ranging from career and business productivity to web development and digital marketing. He occasionally writes articles for carpet cleaning.