10 top tips for the young entrepreneur

10 top tips for the young entrepreneur

This is not a motivational article, but a guide to action: where to start, who to work with, when to relax. Here are 10 top tips for young or aspiring entrepreneurs to get you started.

1. Don't be in a hurry to quit your day job

Running your own business seems like a tempting prospect when jostling on the subway on your way to the office. Working for yourself allows you the peace of mind to wake up when you want, go on sick days, and pick up your kids from school on time.

But when you quit your job, it doesn't get any calmer:

  • You'll have to wake up early to get everything done.
  • Taking sick leave means losing income.
  • Picking up the kids from school in the middle of the day will still be inconvenient.

And all this against the background of unstable income. In order not to regret your choice, prepare the ground before you leave the office. The most comfortable option is to start selling a product or service in your spare time. And quit your job only when you have built up an initial pool of clients and get the first serious money.

If combining work for hire and business will not work, consider your time and salary in your business plan. This makes it easier to see if it is worthwhile to run your own business, or if it is better to remain a salaried employee.

2. Write a business plan

The arguments against a business plan fall into two types:

  1. Why waste time when everything in this country is so unpredictable?
  2. Steve Jobs/Henry Ford/Roman Abramovich succeeded without a business plan.

There's some truth to that. It is impossible to calculate everything, and many famous businessmen simply did what they loved without a clear plan. Still, it is worth calculating basic business scenarios and market volume. This will help structure your thoughts and get rid of doubts - or conversely, doubt the viability of the idea. All other things being equal, quality planning won't prevent you from becoming the new Steve Jobs.

3. Work on product and marketing

"Which is more important: the product or its marketing?" - is a question that causes a knife fight in the marketing community. Some say that if you know how to sell, a customer will gladly buy even a 1:6 scale replica of Jason Statham's head. Others believe that if you make a really cool product, everyone will know about it without marketing or advertising. 

The truth is in the middle. A bad product, if well promoted, can show impressive initial sales, but it will be difficult to retain customers. Such a business won't last long, especially if the market is small. A great product without marketing, most likely, no one will know. Yes, sometimes entrepreneurs have succeeded only at the expense of quality. Salvatore Ferragamo grew an empire from a 2x2 meter shoe shop without a marketing department. But that was at the beginning of the 20th century. Now, it takes a lot more effort to break through the noise of information to the consumer.

So develop marketing, product, and sales-and don't get into pointless arguments about what's more important.

4. Pay your taxes

Many business people find it difficult, expensive and pointless to work "white collar".

"Are you going to pay your repairmen through a legal entity?!" - is the real phrase of a regional businessman who suspected a tenant of paying taxes.

Companies pay contractors in envelopes and give out "gray" salaries. Everybody works this way - and nothing.

5. Don't work with friends and relatives

At first it seems like a great idea - to start a business with a friend (brother, brother-in-law) who has the right competence. This is someone you've known for a long time. You can rely on him. But keep in mind that in our culture it's hard to distinguish between work and personal. An American can threaten to fire an employee, and an hour later sit with him in the pub and ask about the health of his children. But Russians have a hard time negotiating and sharing profits with a significant other. Either you ruin the relationship or the business suffers.

If you're not ready to fight with a friend over a deadline, it's better to keep personal and business relationships separate.

6. Plan everything

Planning things is essential - and there's no question about it. With time left over, you can unwind and relax.
But there may not be time for fun: when you start a business, things will get busy. The result of working without rest is a burnout and a long rehabilitation.

You need to put not only business matters into your planner, but also entertainment. Treat it as part of the work process.

7. Test the product on a real audience

Telling everyone you know about a new project is a useful idea. But it's not full-fledged testing. Friends may praise the product, but that doesn't mean they'll pay for it. 

To "feel" your audience, interview people you don't know in the right segment. Where to find them:

  •  Professional forums. Look for active members and knock on their door. If forum rules allow, create a thread inviting them to test.
  • Reddit. This is a social news site with a huge audience. Find the topic you want and write messages to the most friendly members of the discussion.
  • Social Networks. Join highly specialized communities and invite members to try the service.

Simply write to the potential customer about the project and your desire for advice. Offer them a gift or a review of their product in return. Many people are happy to give their opinion to an interested interlocutor. And you'll get honest feedback and understand the audience's needs.

8. Save

Business start-ups are afraid that if they start saving money and haggling with suppliers, no one will cooperate with them. In fact, once you start cutting costs, nothing will go wrong. Save as much as possible. If you suddenly remove an important expense item, employees will report it.

Savings in business is best described by Robert Phifer in his book Costs Down - Sales Up. He writes that little things like L'Occitane soap in the office or expensive pens will ruin you faster than you think. And you have to haggle regularly with contractors and suppliers.

9. Befriend your customers

There's an opinion that not all customers are equally helpful.
A few months after starting a project, the entrepreneur understands which clients are beneficial to him. But at the start, being selective with your audience is dangerous. Potential customers easily find substitutes for uncooperative companies. And if you think customers are idiots, like the commenter above, you'll lose not only sales but also your reputation.

Communicate and be attentive to every potential buyer. Sometimes introductions lead to success.

10. Take care of your health and family

For the aspiring entrepreneur, the most important thing is his business. All the energy goes to partners, clients, contractors. And health, family and the whole world will wait.

But if you ignore any area of life, it "sags". Business can take off or shut down, but with yourself and family you have to live on. So prioritize so that you do not lose the main thing.

Conclusions

  • Before you quit your day job, build up an initial pool of clients and get your first money's worth.
  • Don't mess with the IRS, work "white collar."
  • Product and marketing are equally important. Develop both.
  • Don't work with friends and family and filter their recommendations about your project.
  • Plan everything: business development in general, work and personal time.
  • Do not cut off unnecessary clients at the initial stage. You do not know how the business will develop and who will benefit from your offer.
  • Remember about rest, health, and family.