Are you passionate about a specific business idea and want to pursue the path of realizing it?
Do you want to gather information on how to become an entrepreneur?
Many people consider starting their own business at some point but don’t know where to start. Luckily, becoming an entrepreneur isn’t impossible, and you can do it by following seven simple steps.
In this article, you learn everything you need about becoming an entrepreneur and what to expect from such a gig.
- An Overview of Entrepreneurship: A Primer
- What You Will Need To Become an Entrepreneur [& Associated Costs]
- Is It Hard To Become an Entrepreneur?
- How To Become an Entrepreneur in 7 Simple Steps
- Reasons To Consider Becoming an Entrepreneur
- Frequently Asked Questions
- Similar Gigs To Check Out
- Wrapping Up
An Overview of Entrepreneurship: A Primer
Entrepreneurship has gained quite a reputation over the last few years. You can never guess which brilliant idea becomes the next big thing.
That’s why people now are thinking more about focusing on starting their small businesses and working on building them.
You need to understand the concept of working as a freelancer vs. launching a promising startup and everything in between.
Some small business owners prefer keeping it at a manageable scale. That’s what a micro entrepreneur does. Such a person never considers the possibility of hiring employees or growing into a large company.
As for those who aim to grow, learning how to become a leader in a specific field is necessary. A startup entrepreneur has to be a successful negotiator, business owner, and deal maker.
How Much Do Entrepreneurs Make?
Owning a startup can be profitable, but remember that a business can start to slow or fail. This usually means low salaries or none at all, and it’s why the numbers vary widely.
On average, a U.S. entrepreneur makes a bit over $70,000 per year, according to Zippia.
The money entrepreneurs make depends on the type of business and how successful it becomes. It also varies according to other factors, such as the person’s experience, education, and location.
For example, entrepreneurs make more money in states such as Massachusetts, New York, and New Jersey than in other regions.
Usually, entrepreneurs choose to either pay themselves a fixed salary or base it on the profits their businesses earn. Otherwise, they wait until their business becomes more successful.
As an estimate, an entrepreneur’s salary ranges from $42,000 to $118,000 per year, with an average hourly rate of $34.06.
What You Will Need To Become an Entrepreneur [& Associated Costs]
Becoming an entrepreneur requires hard work and dedication. Although some ideas require more resources than others, almost all startups need the following
- Education and Experience: Not only do you need experience in the field of your startup, but you also need to know how to plan and keep a business going. Many business owners succeed without prior experience, but it sure gives you a head start.
- Planning: Having a business plan is essential before beginning your entrepreneurship journey. It lays out all your business’s objectives, strategies, and goals.
- Incorporation: The cost of setting up your business structure and filing all legal paperwork varies from state to state.
- Licensing: Some types of businesses require getting certain licenses and permits. This also depends on the state you plan to have your startup in. It often starts at $50 and reaches a few hundred dollars.
- Labor: While you can start some businesses on your own, others require the help of at least one or two more individuals. That’s why it’s important to consider the cost of hiring employees.
- Marketing: For people to know your business, you need to spend some cash on marketing. A website, social media profile, and some digital marketing campaigns work effectively to attract potential customers.
- Equipment: This is also a money-consuming variable ranging between a few hundred to several thousand dollars. Your business may require some expensive equipment to start, or it may only need an internet connection.
- Business Insurance: It’s vital to issue general liability insurance to protect your business from legal expenses in case of an injury or accident.
- Taxes: With federal corporate taxes at 21%, it’s better to set some money aside than be surprised by an enormous bill at the end of the year.
- Leasing: Depending on the type of your startup, you need to lease a working space or a storage area.
How Much Does It Cost To Become an Entrepreneur?
The costs of starting a business vary from one idea to the other. While some businesses need gigantic capital, others can get running with the littlest amount of money.
Averagely, most ideas need between $30,000 and $40,000 as startup expenses.
Is It Hard To Become an Entrepreneur?
Theoretically, becoming an entrepreneur isn’t hard. You shouldn’t have any difficulties as long as you have a proper idea, a good plan, and sufficient capital. Otherwise, it can become risky to get your venture up and running.
In all cases, a business is bound to face many challenges as it starts to grow. As an entrepreneur, it’s essential to be prepared and learn how to address such complications.
How Long Does It Take To Become an Entrepreneur?
You can’t determine how long it takes a person to become an entrepreneur, as it’s not like any other job. You can call yourself an entrepreneur from the moment you start thinking about your startup. So, the straightforward answer is no time.
The question is, how long does it take to make a profit from your initial idea?
Typically, a successful business takes two to three years to become profitable. Yet, it’s important to consider that each startup measures profitability differently.
How To Become an Entrepreneur in 7 Simple Steps
Becoming an entrepreneur is a dream for many ambitious people. Yet, some people don’t know where to start.
You can have many ideas going around your head. However, execution is a whole other matter.
Step #1: Choose a Startup Idea
The best startup idea shouldn’t only be successful or profitable, but it also has to be something you’re passionate about. After a while, this passion becomes the fuel that keeps you going even if you face some issues along the way.
In all cases, it’s important to focus on doing what you know and what others need.
Step #2: Work on Your Skill Set
Once you pick the right business idea for you, you should evaluate the skills you have. This enables you to find out about the certain skill sets you lack, whether it’s an apprenticeship, work experience, or even a degree program.
Learning the basics of business administration always helps in avoiding many further complications.
Step #3: Write a Business Plan
While it may seem an unnecessary step for some, a business plan is essential. It helps you get to the market quicker and stay focused along the way.
It doesn’t need to be a detailed scheme. A one-page business plan stating the goals, strategies, and action steps is more than sufficient.
Step #4: Build Your Network
If you take the time to connect with other ventures and make connections, you can gain valuable benefits. Such contacts can help in many ways, whether by giving you advice, making deals with your business, or even granting you a loan.
Step #5: Do Market Research
Understanding the market is a huge part of a business’s success. Learning about what people need and who’s more likely to benefit from what you offer is key. You can do that by developing a buyer’s profile, knowing their interests and needs.
Continue refining these results by conducting surveys and interviews until you fully understand your potential customers.
Step #6: Secure Funding
You need to secure funding, especially if you don’t have enough money to get your business running. You have many options, including asking family members for a loan, looking for an angel investor, raising crowdfunding, applying for a bank loan, etc.
Step #7: Build Your Business
Once you get to this stage, the serious work begins. You should start putting the funding into action by getting the needed equipment, registering your business, leasing an office location, and so forth.
Building a business and growing it can be challenging. Nevertheless, everything is possible with hard work and dedication.
Reasons To Consider Becoming an Entrepreneur
Despite being a tough job, there are many reasons a person may consider becoming an entrepreneur. Take a look at four of them.
- Becoming Your Own Boss: By becoming an entrepreneur, you set your own work/life balance. You have more flexible hours, making you able to decide where and when to work.
- Earning Potential High Profit: Unlike other jobs where you know your salary cap, you can earn a great deal of money by being a successful entrepreneur. Although there are high risks involved in starting a business, it can be rewarding when it grows.
- Doing What You Love: Working on an idea you feel passionate about is highly rewarding. It reflects on the success of your business and how you feel.
- Leaving a Legacy: What starts as a simple idea may carry on to the coming generations and become a legacy you leave for your children.
Frequently Asked Questions
What startup idea makes a suitable side hustle?
A: Many startup ideas are great if you’re looking to make extra money on the side. You need to consider what your skills are and what you’re willing to do.
For example, delivering packages is a great second job. Rideshare and home care are also fantastic.
What challenges may an aspiring entrepreneur face?
A: The current business world is competitive, putting entrepreneurs in the face of many challenges. This includes
- Risking what they have
- Facing time management issues
- Having problems with the cash flow
- Suffering to balance their professional and personal life
- Working overtime to keep the business running
Similar Gigs To Check Out
Entrepreneurship is a broad term that houses a large number of business ideas. There are plenty of uncommon side hustles people think about every day. What matters most is careful planning and proper execution.
Here are three helpful similar gigs to check out.
- How To Start a Business: Starting a business requires a full understanding of the associated market and its basic requirements.
- How To Start a Small Business: A small business is often easier to start than others, yet many ideas can lead to huge success.
- How To Start an Online Business: As long as you have the proper expertise, an online business can be a fantastic idea.
You may stay up all night thinking about the possible businesses you wish to own. However, none of these dreams can come true unless you know where to start and how to become an entrepreneur.
It’s a long journey full of hard work, dedication, and sometimes sacrifice. That’s why you need to prepare yourself for what’s to come.
Share what you think about this article in the comments below, and send it to all your interested friends.