Do you want to be your own boss? An entrepreneur is someone who goes all in with capital and time to bring their ideas to life.
An entrepreneur is commonly seen as an innovator, a source of inspiration and good ideas. When you are an entrepreneur, you create or invest in one or more companies. When talking about entrepreneurs, we often talk about individuals that have found a gap in the market or a new solution to an existing problem.
Everyone can become an entrepreneur if they set their mind to it. But you have to be willing to spend a lot of your time on your business.
How to become an entrepreneur
If you have a good idea and have collected enough information about the market you will operate in, you have come a long way. It is a good idea to do a market analysis and make a business plan when starting a business.
A great tip is to use the Business Model canvas to create a business model. It’s a strategic management template used for developing new business models, and it is useful because it gives an overview of what your startup will look like. Both for yourself and potential investors.
See also: 10 reasons why you need a business plan
Select organisational form
When starting a business you need to choose what organisation form you will have. The two most common types are sole proprietorship and limited liability company (LLC).
If you plan to be a consultant or freelancer, you might want to choose sole proprietorship.
If you plan on growing, hiring employees and purchasing expensive equipment, a limited liability company will be more suitable for you.
Know your audience
The more you know about the market you want to sell to, the better equipped you are to make the right decisions. It is also easier to find your niche in the market.
It’s a good idea to take a look at what potential competitors do, and what you can do to stand out in the crowd. Consider how you want to brand your business and what pricing strategy you think will work. It’s all about satisfying a need in the market and offering a service that can compete with existing businesses.
Learn to pitch
As an entrepreneur you should learn how to pitch your business. If you have investors on board from the go, it can give you a head start. To secure investors you have to be able to sell your idea and your business plan. The same goes for selling your service or product to customers.
Know who you are pitching to and what they would be interested in hearing about, and be conscious of how you present both yourself and your idea. Practice makes perfect!
The best pitches have a story to tell. Convince the listener that you can solve a problem or a challenge, and express your passion for your business.
Get the required capital
Make sure you have the capital you need in order to get started with your business. What do you need to purchase before you can get started? Does your business need an office space? A car? These are things you have to consider. If you don’t have enough money yourself, you should look for investors.
It might take some time before you can take out a salary. It’s not common that a business achieves profit the first few months.
Use your network
Do you know people with specialised expertise, or people who can help in other ways? Part of being an entrepreneur is knowing when to rely on other people’s expertise, either an acquaintance or a service provider.
Make a budget
During the startup period, expenses will often exceed your income. A startup budget will be able to help avoid negative consequences, by giving you an overview of the required capital.
You should also prioritize creating a profit budget, also called operating budget, and a liquidity budget to make the company better equipped to handle the ups and downs, and make day-to-day operations more predictable.
A profit and loss budget is a statement of income minus costs, and will give you an overview of the company’s financial standings after a certain amount of time has passed.
Keep accounts from the very beginning
Don’t wait to start accounting. Before you have start selling products or services, you should think about who will do the accounting – whether you want to do it internally or outsource the service to an accountant.
Use an invoice software
Unless you have a cash register system or run a business that only takes payment directly, you need an an invoice system. With an online invoice system you can easily create invoices and send them to your customers.
See also: How to send an invoice
An invoice system makes sure that your invoices look professional. When you make your invoices in a dedicated invoice system, you ensure that you comply with best practice guidelines and laws. All invoices are stored in the system, letting you follow up payments and overdue invoices with ease.
In need of an invoice system? With Conta, you can send unlimited free invoices. Sign up!
See also: How to write an invoice
Know your limits
Being an entrepreneur can be quite labour-intensive, and there can be many late nights. And when you’re young, this might be fine, but it might also be a good idea to try setting some ground rules. If you are completely exhausted, it will not benefit you, your company or the people around you.
Take care of your own health and try to have a healthy work-life balance – although it can be challenging when you are your own boss.
Good luck as an entrepreneur!
See also: Hobby or business?
