The United States is in the midst of a wave of small business innovation. According to the US Census Bureau, nearly 1.7 million people will look to start a new business in 2022. This is 28% higher than before the outbreak in 2019.
Including those companies unable to hire, the number of new business applications reached 5.1 million.
Two years ago I published a book with Seth Levin. The new builders Working for America’s Next Business Owners. Women and people of color are more likely to own businesses in the service, retail, and restaurant sectors. Today’s small business owners face a lack of access to capital and an uneven competitive landscape dominated by large companies as their biggest obstacles. But starting a business today is cheap because you can test your ideas on an online platform for a few thousand dollars multiple times. New funding and resources are available to help.
Here are seven lessons. From new developers And how other small business owners succeed when starting a business.
It is better to start small but have a vision to grow.
Maybe your business income will grow; Less than 15% of companies get a bank loan or capital to start. This means you need to start small and invest enough money to reinvest the business with surplus. By definition, this means starting small and eventually using your savings to get started. But you have an idea of what your business will look like as it grows. If you envision yourself leading a company of five or ten employees and multiple locations in three to five years, you can create plans to help you get there.
Do not give in to your thoughts or even interfere in your work.
There’s a funny myth in the business world that success involves persistence, or “going all out.” You must be patient, but your most valuable attribute is your ability to drive. If the idea doesn’t work, move on. One of the business owners we interviewed was Fred Schacht, an Alexandria, Virginia entrepreneur who owned two successful businesses, a hardware store and a woodworking shop, and in his later years made organic flour and supplied restaurants and bakeries.
“Sometimes you have to find a solution to a particular problem, sometimes you have to create something new to overcome a particular obstacle,” Schacht said. “And if you don’t solve the problem, you’re going to be left behind. You have to change.”
Do not take a personal loan
Your first thought might be to take a bank loan. But getting a commercial bank loan is incredibly difficult, because banks won’t approve commercial loans unless you can show you have enough income to make the payments (CDFIs, for-profits, can be a little easier).
Sometimes entrepreneurs get into debt on their personal property. In today’s fast-paced economy, borrowing money at home or using a credit card carries significant financial risks. Do not borrow money for your offspring. Before you take out a loan, make sure you know how well your business is doing – in terms of customers, sales and profits – test your idea and find other sources of funding.
Your most important advisor is your client.
If you’re tempted to hold onto your best idea, remember that entrepreneurship is often a service industry. They exist to make the lives of your customers and clients easier or better. If you’re not buying what they’re selling, it’s time to change.
Don’t waste money on shopping.
Early in your business, when you’re developing your product or service, one of the best uses of your time and money is to test the market. But don’t confuse market testing with follow-up marketing.
Find the cheapest way to deliver your product or service to customers. If you’re using a large tech platform like Amazon, Etsy, or Instagram to review a product, keep in mind that they often have hidden fees and can be added without notice. You may want to try other options to find potential customers. Many large technology platforms face new competition from smaller, more specialized or locally owned versions.
After it is created Profitable business model, you can invest money in the market.
Become a professional accountant
• Create a bank account in the name of your company, not yourself
• Hire an accountant. If you don’t have the desire and talent to track finances, you can get an online ledger or transcript for a few hundred dollars a month. You can’t do it now, but do it as soon as possible. It will also help you at tax time.
• Spend at least one day a month (or week) on your paperwork: checking your bank account, paying your bills, and writing your bills.
Is there a local version of DoorDash near you or a retail platform that sells products and services in your city?
Likewise, companies that provide services to small businesses such as B. Accounting or financial platforms
Learn more about the types of financing options available
Capital from your own savings, friends and family is the best and cheapest way to start. Community Development Financial Institutions (Find the ones near you here: Nonprofit lenders can offer small loans or working capital. Bank loans are paid off when you’re established and have revenue and profits. Your best chance of getting approved is probably at a community bank. That’s a small business for a loan. Good guide.
Many other entrepreneurs tell similar stories.
Venture capital is only available to fast-growing companies (especially those with business models that generate millions in revenue in the first five years). Investment capital is generally only available to the well-connected. If you don’t have an “inside” or technology-driven business model, don’t waste your time.
If you want to pitch a given project, it might be worth investigating an accelerator like Techstars, Camelback Ventures, Y Combinator or Ad Astra Ventures that prepares you for venture capital investment. EforAll is an incubator that helps entrepreneurs connect with banks and other lenders.
Get free information
There are many influencers and other marketers who offer insights and training hours – if you pay. But first, check out the free information.
SCORE (Service of Retirement Executives) is an excellent resource.
Verizon and the Association of Women’s Business Centers offer a free program to help small business owners learn about digital tools.
Check out resources at local colleges and universities.
Rebecca Brady, founder of Buffalo, New York-based Top Seeds, started her biscuit career by visiting Buffalo State University’s Small Business Development Center, where she learned some of the basics of starting a food company. . Investing $5,000 of his own money, he rented a community kitchen and began selling at farmers markets. This year, after just four years, he set a sales goal of $4.5 million. His advice?
Don’t waste your energy watching what your competition is doing or looking over your shoulder at the past. Remember the goal you want to achieve and focus on who you want to be.