According to WHU School of Economics and Management, an entrepreneur is “a person who sets up a business or businesses, taking on financial risks in the hope of profit.” It is a high risk, high reward world. An entrepreneur, like a meal, may need many different components to come together for it to be complete. It is a highly competitive, cut-throat world of high achievers, and in this article, you will explore the ten crucial tips for budding entrepreneurs.
Research
It is essential before setting up a business or getting into a market segment, that you do your research. Take your time and try your best to keep an eye out for customer trends and market reactions. It’s best you also lend an ear to your potential client’s needs and get an idea as to how your business can become their solution.
It is suggested to read books, listen to podcasts, network with executives, and research information on the market. It will help get your head in the market and become knowledgeable of the customers in it.
Financial Mindset
An essential thing that a budding entrepreneur should keep in mind is, ‘cash is king.’ So you have to be practical when it comes to your money. For example, many people who start are obsessed with what the future will hold and how much money they could be making instead of focusing on the present scenarios and financial needs.
It’s crucial to have a strong financial foundation to build from. Most people get ahead of themselves and risk everything without having any security.
Taxes
Starting your own business can be
troublesome if you get into the bad books of the law. You should comply with
all tax regulations and requirements of your country. Working with a
professional accountant from the start can help you avoid any financial
penalties.
Generate Funds
Money is the blood of all businesses. You can’t run
a successful business without constant inflow and outflow of cash. One of the
biggest goals of a new entrepreneurial business is to secure funding or raise
venture capital.
To increase your chances of getting funded, you need to come up with a detailed
business plan. It should include who you are, what your business is, research,
and provide an in-depth market analysis. Showing a projection of your company
and its goals over the next five years will also give investors an insight into
how dedicated you are to your project. It will eventually increase their
interest in funding the business.
Venture
capitalists (VC) would require the same level of commitment in
detailing the business’s model. It will showcase how quickly your economic
engines operate and make you more reliable. Another alternative is to go to an
online lender or visit a bank to acquire a loan.
Crowdfunding
Sometimes the best place to look for support is amongst your friends and family. It is apparent to those closest to you how serious you are about your project. If they agree with your determination and how much effort you’ve put into the business, they will be keen to invest.
Otherwise, if you have put all effort into your business idea and it appeals to the masses, the angel investor you seek could be out there. Start gaining your crowdfunding for your startup. For example, Oculus Rift, which was acquired by Facebook for $2 billion was a Virtual Reality headset, started off as a crowdfunding project on Kickstarter.
Learning with Your Team
There is no one better tuned into your business than the ones who help you run it daily. If you want to go fast, you go alone. But if you’re going to go further, you go together. In this highly competitive arena of entrepreneurs, having a team that you can listen to and learn from is invaluable.
To lead a team and to lead a market, it is crucial
that you not only pick up knowledge from books or seminars but by also
listening to your members. Your team is working on a million different aspects
of your business. There is a lot of information that could be key to how you
run your business in the present to give it the best possible future.
Long Term Gain
In this domain, it’s easy to get shortsighted and
lose perspective of the game. During the long hours and daily grind to keep the
business running in all aspects, it’s essential not to forget to invest in the
longevity of the company.
It means taking out time, at least once a week to give back to the business to
ensure that it is here to stay for the long term. It includes investing in
further marketing, research and development and training of employees.
Understanding the commitment
It’s no exaggeration that being an entrepreneur
means being able to put all your time and effort into the business. It is
crucial to have a strong foundation, or any shortcomings in the initial stages could
result in its failure. It means that you can not waste any time or effort on
activities that do not directly influence or benefit your business now or in
the future.
It is a 24-hour commitment with your business. You have to make a lot of
sacrifices for the company, only for it to be able to stand a chance. It means
no partying on the weekends or binge-watching Netflix to no end. Not saying your
business should be your only focus but understand that if you want your
business to survive, there is a lot you must sacrifice.
Achieving your goals must come with an immense amount of mental courage and commitment to your business. These sacrifices are only essential if you believe in your work.
One Year Plan
Most
businesses are set up for failure within their first year. The rest of the companies
are tied up in setting things up and being operational. There are official
documents that need to be registered, meeting the government’s standards and
licenses that allow your business to be fully functional.
So within the first year, it would be a miracle if your business is already
doing great. If it isn’t that should not be a problem because it’s the first
year. As discussed, there is still a lot to do for a business in its inaugural
year.
That is why it would be beneficial to make a realistic plan that details all
your goals for the first year of business. It can be dangerous if you do not
set a reasonable list of expectations.
Plan Further Ahead
Planning
and executing in the first year of your business can be the difference between
survival and extinction. But where to go from there?
You need to build a plan with a vision for the future — ideally, a five-year
plan detailing your objectives for the business, and its employees.
