Whether you’ve spent one too many nights heckling at Dragons Den, thinking you could do better, or you’ve already quit your job - taking the leap to becoming an entrepreneur and setting up your own business is a life goal for many.
According to Companies House, nearly 600,000 new businesses launched last year in the UK alone. And with so many people preferring a more flexible lifestyle, it can be easy to see why one might want to shun the shackles of the 9-to-5.
Whilst the appeal might be there, the practical reality of setting up shop could be different from your expectations. Whether you want to start a small dropshipping operation or aim to become a business worth billions some day, all businesses go through the same initial process.
So what’s the best path to entrepreneurship? 🤔
Your dreams of becoming a business owner will no question require a lot of work as you will be the flagbearer on all business decisions! But how do you become an entrepreneur? Well the path to creating a business mogul out of yourself is definitely the well researched one. Do your homework, talk to lots of people, create a strong network and you’ll minimise the risk of setbacks along the way.
So let's go through some basics that every prospective business owner should go through.
1. Evaluate your situation ✍🏻
Whilst many entrepreneurs will harp the benefits of starting before you’re ready, it’s also important to start when the time is right.
Ask yourself - Can I afford this? What sacrifices will I have to make? Am I self motivated enough to be my own boss? What responsibilities do I have? Do I have the right amount of experience in this field?
💡 Always think before you act and ask yourself if now is the right time to start.
If you’ve got a massive mortgage to pay and little in savings for instance, it might be best to start your business when you’re more financially stable.
2. Research your idea 🔎
So you’ve come up with a killer idea that you hope will make you millions. Before you invest any money into it - research! Know your competitors, research the market, find your customers and evaluate how viable the idea is.
It’s always easier to start something within a genre you have expertise in, as the knowledge, experience and probably the network of people you will need to rely on are already there.
💡 Some of the best ideas have come from people creating solutions to their own problems, and Revolut is the perfect example!
What’s your customer's pain point? What’s your end goal? How are you going to help them? Well, the secret sauce to finding answers to all of this is actually simple: always be talking to people and try to validate your idea. Understanding the needs of customers, getting their input and making sure they validate your idea is key to going ahead with your new business venture.
3. Make a business plan 📝
So you’ve done your research, now’s the time to put all that hard work down on paper. Creating a business plan will really help you to dive into the nitty gritty details of what starting your business will really be like and with which scope you need to head into the battle.
💡 Make a realistic plan and make sure you account for not just your strengths, but all your weaknesses too.
It also helps you to think about other aspects of the business which you may have little experience with, such as marketing or finance. Keep it concise and to the point. Some people dread this step, but try and think of it as a key tool that you can use to grow and refine your business, rather than something that just has to be done.
4. Decide what business structure is best for you 🤔
Most businesses in the UK are set up as a sole trader, partnership or limited company. If you need some help or support with setting up your business in the UK there are plenty of resources available to you, to make the process as easy as possible. This of course depends on where you would like to set up shop. Check local rules and regulations regarding your duties.
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5. Open a business bank account 🏦
It’s important to open a business bank account so that you can keep your personal expenses separate from your business ones. Choose an account that can integrate apps such as accounting software like Xero. Banking tools that seamlessly utilise apps, can really help to streamline your finances and make managing your businesses cash flow that much easier.
💡 Ultimately, it all comes down to money; but how you manage it will make all the difference. Know your options!
Consider the types of payments you’ll need to make and how much banks charge for doing so. For example, if you have to pay a supplier in China, most banks will charge you hefty fees. But with a Revolut business account, you’ll be able to make fast international transfers instantly with no fees, using the real exchange rate - which means no waiting and more money in your business.
Should you hire employees, you can also set up cards and budgets for each team member so you can easily track expenses.
6. Look for support 👋🏻
Just because you're taking the initiative to become an entrepreneur, doesn’t mean there aren’t fantastic resources out there to help you achieve this goals.
In the UK you can get advice and financial help from government backed schemes. You could also look into finding a mentor, joining small business groups and attending networking events. There may also be vouchers, tax relief, credits and grants available to you, that could help to accelerate your business.
💡 Here are the main areas where traditional business banking fails to deliver.
7. Know the red tape 🔴
Once you start a business, you are liable to know exactly which laws apply to you and the red tape that affects your specific business. If you don’t know these things, you could find yourself in hot water! Find out if you need any licenses, for example to sell food or play music.
Are you going to be employing people? Will you be working from home or renting office space? What your business does will dictate the laws and rules you need to follow. Find out the legal aspects of running your business, so you won’t run into trouble along the way.
8. Join organisations and associations 🏘
Every genre has its own network of associations, which make for a great way to keep up to date with industry specific news and updates that are relevant to your business. Networking is also one of the least expensive ways of marketing your business and a great way to make a wealth of contacts. You can find out about get togethers organised by seasoned entrepreneurs for people much like you on websites like Meetup or Eventbrite.
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9. Think marketing! 📣
People have to know about your business so that they can use your service, buy your products, eat in your restaurant etc, etc. Word-of-mouth and viral growth only go so far so you definitely need to lock in some best practices used by many successful young businesses.
Marketing is the only way that you can spread the word about what you offer and why people should care. Don’t underestimate the importance of a great website you can easily set up with Wordpress, a sleek logo you can order on Fiverr and a stellar digital marketing strategy you can read up on over at Moz. And if Reddit is your thing, /r/entrepreneur isn’t a bad source for tried-and-tested tactics.
There are many ways you can market your business, so test and monitor what works best for your niche and think about investing money in those areas so that you can reach more potential customers. Remember, the internet is a vast ocean of information and it certainly isn’t lacking in anything marketing related!
10. Create a schedule 📆
When you work for yourself it can be tempting to start late and spend the day in your pj’s - look to all the high profile entrepreneurs and you’ll find that they usually rise with the sun, plan their day ahead and don't make excuses to push through and get it done!.
Setting up your own business is hard work and it’s important to hold yourself accountable, by setting up a work schedule that you can commit to and one that will get you the results you want. If you’re looking for an easy ride, think retirement instead! 👵🏻
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