Think you’re ready to start your business? Even if you have literally the best idea that anyone has ever had, being an entrepreneur will not be easy.
Succeeding in business takes more than just brains, determination, and a brilliant concept. The best entrepreneurs have a special set of skills and unique knowledge that helps them rise to the top.
So before you register your business, buy a domain name, or ask your grandma for seed money, make sure you’ve got the real basics of entrepreneurship down. It’s time to brush up on some of your soft skills and prepare your future company for success by building a strong foundation.
Start With a Business Plan
A business plan needs to have a lot more meat on its bones than just, “Open the doors, get customers, make money.” A truly effective business plan should contain an executive summary, company description, market analysis, marketing plan, and if applicable a funding request or financial projections. If that sounds intense, that’s because it is.
Don’t cut corners when you’re writing your business plan. Do tons of research into your market, your competitors, and your customers, and use your findings to create a truly comprehensive guide for growth.
At the end of the day, your plan is kind of like a treasure map for the future of your company. You’ll never find the treasure if your map doesn’t lay out all the steps.
Build Solid Relationships
Have you ever worked with someone who was a total genius but also a raging jerk? Despite their talent, you probably wouldn’t look forward to tackling another project with them. When it comes to your business, relationships matter in much the same way.
As an entrepreneur, you need to be able to form great relationships with clients, employees, contractors, and other entrepreneurs in your community. Establish a reputation for yourself and your company that shows people that not only is your service or product great, but you’re also wonderful to work with. Don’t be a brilliant dunderhead, or worse, a jerk whose business isn’t even that great.
Plus, you never know who could help your company land a big break!
Debt Is a Tool, Not a Crutch
Lots of entrepreneurs take out loans or rack up a bit of credit card debt when they’re developing their business. It’s perfectly normal to use this kind of debt when you’re in your early startup phases.
However, you should always think of debt as a tool that will enable you to bring your business to profitability. You want to avoid leaning on loans and lines of credit forever because over-leveraging yourself can lead down the road to bankruptcy if you ever fall behind on cash flow.
This is where your business plan comes in handy. If you are taking on any startup debt, be sure to make detailed plans to pay it off. Stick to these plans fanatically and only use debt to fund projects with a quantifiable and prompt payoff.
See Yourself as an Employee and a Shareholder
As an entrepreneur, you might find yourself wearing lots of hats in your organization. Going in, you should also be comfortable seeing yourself both as an employee and a shareholder in the company. Make decisions that will serve the needs of your employees (if you have any) and shareholders, because at the end of the day you are truly both.
Find a Mentor
Finally, don’t try to go it alone as an entrepreneur. Starting a business can be exciting, scary, exhilarating, demanding, wonderful, and awful, and that’s all before lunch.
A great mentor can help you stay calm as you navigate these uncertain and uncharted waters. They can use their experience and wisdom to help you avoid mistakes and be a sounding board for your questions on everything from setting prices and tax questions to hiring and firing and work-life balance.
Your mentor can be another entrepreneur in your field, a previous boss or manager, or an older relative or friend. Whoever you choose, make sure that they are someone who you can rely on in good times and in bad to give you advice that will push your business forward.
Learn how to save now and retire early: Financial Independence Retire Early (FIRE) Explained.