February 20, 2017
If you've ever dreamed of being an entrepreneur, you're not alone. Building a company from the ground up has long been a part of the American dream, and it's an important driver of the United States economy.
According to the U.S. Bureau of Labor Statistics (BLS),* start-ups less than a year old created 1.7 million jobs in the year ending March 2015, accounting for 60% of total employment growth in the nation that year.
Still, having a passion for entrepreneurship doesn't automatically equate success. In fact, only 51% of new businesses launched in 2011 were still in operation five years later in 2016, according to the BLS data.**
Entrepreneurship is hard work and requires plenty of preparation, planning and business acumen. How can you see yourself succeed as an entrepreneur? Learning from other business owners is a great place to start.
From advice on identifying gaps in the market to building a strong team and gaining the business skills you'll need to grow your company, these tips for entrepreneurs- by entrepreneurs- can help you on the road to owning your own business.
If you're getting ready to start your first business, it's likely that you already have a business idea in mind. But while having a great idea is important, it doesn't mean your idea will be successful.
In fact, according to entrepreneur Jeremiah Rizzo, a founding member of Construct-Ed.com, an online learning platform for the construction industry, it's far more important for others to have a passion for your business idea.
"By far the most foundational and important tip I can give is: validate your business idea," Rizzo said. "Simply put - ensure that an audience is ready to hand you money for your product before you go through the work of building it."
Rizzo recommends that new entrepreneurs start out by identifying a burning problem that needs solving and then talking to potential customers to explore the best ways to address that problem.
"If your product doesn't solve a pain that people deeply feel, you're going to have an unessential product and a tough time marketing it," Rizzo said. "It doesn't matter how great you think your idea is. What matters is: will people pay you for it?"
While entrepreneurship often starts out as a one-person job, growing a business often relies on building a bigger (and better) team. Thinking carefully about how you build your team, and who you bring on board, is one of the most important entrepreneur tips for new business owners.
Samuel Sternweiler, founder and CEO of online fine jewelry customization company JEWELv, said the most important step of finding a business partner and growing your team is to first take a hard look at yourself.
"Find out what your strengths and weaknesses are," he said. "Many young entrepreneurs bypass this step as it takes a good amount of self-reflection...To find a partner for your venture, you must understand what resources you already have. One of those resources is certainly yourself."
Sternweiler suggests determining which subject matters or areas of the business interest you the most and identifying which day-to-day activities you naturally enjoy spending your time on. If you're interested in design, but not so skilled in sales and marketing, then you know what skills and interests to look for in a business partner.
Many new entrepreneurs overlook the importance of finding help outside of their growing team. If you're still learning how to succeed as an entrepreneur, then finding a mentor may be key to your success.
"Spend time learning from the successes and failures of people who are five, 10 or 20 years ahead of you," suggests Ross Black, CEO and founder of Simple Box Storage Containers. "A great mentor is someone who has proven themselves with some degree of success, but who is also humble enough to admit where they have made mistakes."
While passion and drive are key factors on the road to success, even the best idea can fall apart without the proper financial backing and legal protection in place.
Kimberly Blanchette, senior associate dean of College of Continuing Education at Southern New Hampshire University, said that developing a comprehensive business plan is an important first step in securing vital funding, whether through seed money, grants, loans or investors.
"For entrepreneurs to finance their business venture, a comprehensive business plan must be developed in order to gain support from funding sources," she said.
That same business plan can also help you identify the legal protection your growing business may need.
"It is important for entrepreneurs to explore if and how their ideas can be protected by educating themselves on intellectual property rights and taking appropriate steps based on their specific situation," Blanchette said. "Intellectual property rights include patents, designs, trademarks and copyright."
While a specific education program or college major is typically not required to become a successful entrepreneur, running a successful business requires a laundry list of communication, sales, marketing and talent management skills.
It's important that business owners never forget to take the time to continue their business education, whether through books and podcasts, webinars and training or an entrepreneurship degree program.
"Listen and learn," said Julian Wright, co-founder and CEO of Shotzu, a bulk product photography platform for online businesses. "You might think being in charge means barking out orders, but the reality is that to be effective most of your time should be listening to people smarter than you and evaluating if their guidance is right."
* Bureau of Labor Statistics, U.S. Department of Labor, Commissioner's Corner, on the Internet at https://beta.bls.gov/labs/blogs/2016/04/28/entrepreneurship-facts-announcing-new-research-data-on-job-creation-and-destruction-by-firm-age-and-size/ (visited February 10, 2017): Cited projections may not reflect local and/or short-term economic or job conditions and do not guarantee actual job growth.
**Bureau of Labor Statistics, U.S. Department of Labor, Survival of Private Sector Establishments by Opening Year, on the internet at https://www.bls.gov/bdm/us_age_naics_00_table7.txt (visited February 10, 2017).
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