We all know the dream: making your first million (of many). A stock offering that dwarfs all others. Getting that Ted Talk invitation. Having young business people seek you out for advice. And the first step of that journey surely starts with learning how to become an entrepreneur.
Imagine yourself vacationing in one of those Tahitian bungalows over crystal clear water.
But we all know it ain’t that easy. In Canada, the average number of small and medium enterprises (SME) annually is 95,940. What’s shocking, though, is that the number of businesses that close every year is 90,120. Entrepreneurs start companies at nearly the rate that businesses close.
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A realist’s guide to becoming an entrepreneur
So what does that mean for you, someone who’s interested in learning to be an entrepreneur? It means that you’re looking at a risky — but not impossible — prospect. It means that you need to be prepared and have a realistic vision of what your challenges will be.
I know lots of people who realize their entrepreneurial dreams, and I also see people who don’t make it. Here’s my insight into how to become an entrepreneur.
1. Don’t quit your day job (just yet)
Since most of us aren’t independently wealthy, we need an income to cover our bills. If you believe you have an idea or a business model that’s potentially profitable, start small — even part-time.
If you’re able to pay your bills with your paycheck from your regular job, then you’re saving yourself an enormous amount of stress that many entrepreneurs suffer from.
One COVID-related note here: As bad as the COVID-19 pandemic has been for business, it has given some budding entrepreneurs a rare opportunity. The combination of lots of free time as a result of being furloughed and some unemployment income, equals time to start a new business.
If you have some money coming in and you’re facing a lot of free time, get to work!
2. Make sure your vision is realistic
Most entrepreneurs aren’t glamorous, jet-setters. They’re more roll-up-the-sleeves-get-the-hard-work-done types. If your vision of how to become an entrepreneur involves bespoke business suits and ritzy airport lounges, you need a serious reality check.
Starting and running your own business is hard work, and lots of it. That hard work precedes any glamour you may eventually enjoy.
3. Bolster your business knowledge
You don’t have to know a darn thing about running a business to be a great fitness coach or personal trainer. But you do need to know something about business in order to run a personal training company.
Just because you’re super talented and skilled in your field doesn’t mean you’re ready to be a CEO.
There are a number of routes to getting the business knowledge you need to be successful. Choose one or more of these:
- Take business classes at a community college on the cheap
- Ask other successful entrepreneurs to mentor you
- Hire a great accountant who also has experience as a business advisor
- Check out the competition to build your industry knowledge
Taking the time to start your business the right way can set you up for success. You want to make sure you have all your legal obligations covered, your taxes set up right from the get-go, and a solid vision for how to grow your fledgling company.
Related: How to write a business plan simply
4. Minimize your overhead, especially at the beginning
Sure, there are trust fund kids or folks who get a spot on shows like Shark Tank who can afford to staff up and make big marketing spends at the start of their entrepreneurial journeys.
I don’t know those people. The entrepreneurs I know started primarily as solopreneurs. They started small, with little or no overhead, and they road-tested their business before they or any investors put big sums of money into it.
Not every business can make it. Starting small and working hard and smart can build a track record for your company that can help you attract investors down the road. Sure, you can spring for some business cards, but save your big spending for when you have some money coming in.
5. Network, network, network
If you want to be an entrepreneur, you’re going to have to put yourself out there and network. It’s just that simple.
Networking done right has three main benefits:
- First, it can put you in touch with other entrepreneurs in various stages of building and growing their businesses. Learning from the successes and mistakes of others is a vital skill in business.
- Secondly, you can make contact with other people in your industry, which can help you refine your offerings, learn how your competitors do business, and get clued in about events, publications and professional development opportunities in your field.
- Networking can also put you in touch with your ideal customers (more on this next).
It doesn’t matter if you get together via phone, Zoom or in person. Start making connections with others and be willing to help them out when you can.
6. Find your ideal customers
You don’t have to reach every customer to be a success. You just have to reach the right customers.
Your goal as you learn to be an entrepreneur is to find the folks who appreciate your novel approach to your product or service.
Getting in touch with your ideal customers helps you:
- Create a better product
- Recruit fans, who will in turn bring in more fans
- Start marketing your business (especially via social media)
If you discover that you don’t know who your ideal customers are, or you don’t know how to reach them, you’ve encountered a problem you must solve before you move forward. Creating a product for which there are no customers is a sure road to failure.
How to be an entrepreneur
Lots of articles have been written about how to become an entrepreneur. Many talk about finding venture capitalists and creating a minimum viable product — all good ideas, to be sure, but they don’t really cover the basics.
Here we’ve discussed the nuts and bolts you need to get your new small business off the ground. It’s hard work that can be incredibly rewarding, but going through the right steps and having access to practical advice can make your entrepreneurial journey less stressful and far more successful than even you ever dreamed.