How to become an Entrepreneur
This article provides in-depth information into What is an Entrepreneur? What Entrepreneurs do? Degrees for Entrepreneurs, Steps to become an Entrepreneur and much more
The truth about entrepreneurs is that they can come from any corner of the world. An entrepreneur can be your neighbor, your close friend, or a family member!
Simply put, an entrepreneur is someone who takes financial risks with financial profit as the end goal. They would invest or build an idea they believe would perform beyond expectations, both mechanically and, most importantly, financially, in the long run. If done right, they play a big role in shaping the U.S. economy. Everything you need for becoming an entrepreneur is detailed in this article.
What does an Entrepreneur do ?
You could say that an entrepreneur is a survivor in the business world. Much like a survivor, an entrepreneur does not involve themselves in lavish lifestyles and focus more on saving resources, allocating energy to grow their skills and most of all, have a well-defined direction on what they want to achieve by the end of it all.
It may seem easy on paper, but it’s one of the most volatile opportunities to take up, one that pays extremely well if the execution of your plans are good. Unlike most careers, entrepreneurship can be a side gig while maintaining the main career in something else as means of stable income.
Steps for becoming an Entrepreneur
Find A Lucrative Niche & Audience
Without a good idea on what your audience wants, you won’t have a product to sell. If you don’t have a product to sell, you can’t make money out of it. As an entrepreneur, you are expected to bring to the table a lot of niche, convenient ideas or products.
The problem with most entrepreneurs is that even though the product or idea may sound great on paper, in practicality, they do not possess at least one of the three following vital traits.
The product/idea should solve a customer’s problem and is convenient to handle.
The product/idea is such a niche that it presents a ‘wow’ factor, instilling in the customer a materialistic sense of need for it.
The product/idea is fad, i.e., lucrative in the short-term aspect of the business as opposed to the long-term aspects. (I’m looking at you, Fitbits.)
So brainstorm a few ideas, and plan out how the product may be beneficial, both to your audience as well as your business.
Determine The Need For Higher Education
Entrepreneurship does not require any higher education to pursue; a high school diploma is all that’s required. For this reason, it’s important to figure out if you require any further education.
It’s a good idea to pick up a program and learn the basics of business if you have no clue what direction to take. But if you possess a fundamental knowledge on it, and if you do have a plan, then it’s up to you to either pursue a program to carve those existing skills more, or to just take a shot at your plan and see where it leads you.
It’s a tough decision to make, therefore it’s necessary to make this decision at the earliest time possible.
Get To Networking
Entrepreneurs are expected to be natural at communicating, hence their tendency to build up a large network of people to learn from, rely on or to look to partner up with. Networking is how you will get your product out in the open. Word of mouth will eventually expose it more and more and your product will gain a following.
Outside of professional reasons, without networking, you won’t have an outlet to help you work through the constant burnouts you may face during your stint as an entrepreneur. Networking embeds you within a valuable community willing to help you with the skills they possess.
Get A Pitch Ready For Your Product
Think of an elevator pitch for your product or idea. An elevator pitch is essentially packing everything your product does into a 30-second long statement.
These are some good indicators to show that your product is either needs a reboot or is not going to work:
If it doesn’t grab the investor’s attention.
If the investor feels like the product’s role is all over the place.
If the investor feels confused as to what the product’s role exactly is.
If you feel confused about the product and that is reflected on your explanation.
If you feel overwhelmed about packing all that your product can do in a simple sentence.
Market Your Product
Eventually, if your product gets a good standing among those who you pitched it to, then it’s officially a “Go Sign” for you to create a proof of concept of the product. Using that, you can establish your brand and market the product under it. By constantly pushing the product to your audiences and putting in some finances into it to increase quality - with a bit of luck - it may grab the attention of an angel investor who is willing to pick your product up and quite possibly grow your business.
Financing your product can come from multiple sources, such as bootstrapping, crowdfunding, loans, angel investors and venture capitalists, or credit cards for short-term cash options.
Incorporate Your Business
So you got your capital, a lot of following, a good product, consistent sales, and a progressive business. That sounds great! This indicates the next important, but optional, step; incorporating your business.
The biggest advantages about incorporating your business point to the legalities of your business. When starting off, you and your business will be treated as a single entity. This means that all the debts and financial obligations that your business has will be tied to you. This is bad because creditors can target you for business debts and you will be legally obligated to satisfy those debts even with your personal assets such as your house or your car.
By incorporating your business, you and your business are treated as separate entities. Possessing a corporation status will also give you credibility for investment capital and the business expenses can be automatically deducted before the income is allocated, making the accounts much more manageable.
The only drawback to this is that you will face additional tax burdens. This may include hiring a lawyer and paying the fees to the state annually, both of which can be expensive.
Entrepreneur Degree Levels
Although many would-be entrepreneurs dive into the business world without any credentials, a bachelor in entrepreneurship degree program can be the deciding factor as to whether or not your new business venture sinks to the bottom or rises to the surface. These offerings teach enrolled students the ins and outs of opening, marketing, and managing a business while simultaneously equipping them with the soft skills they need to succeed in the professional world.
The Economic Way of Thinking
Production & Costs
Understand the different sub-markets making up an economy
Explain who the main actors in most markets are
Explain what considerations go in defining the relevant market
Marketing a New Business
Marketing Your Company
Networking and Marketing
Selling Your Marketing Plan
Learn how to implement basic marketing principles
Learn networking and marketing strategies
Understand the importance of CRM
Introduction to financial management
Financial statements basics
Analysis of financial statements
Acquire and exhibit an understanding of finance
Understand financial statements and their components
Understand calculation of different computations that provide valuable financial information
A Master’s degree in entrepreneurship is ideal for those who wish to be self-initiators in a busy world of startups and small businesses. This degree, although not absolutely a prerequisite to starting one’s own business, sets the foundation for assessing various business risks and incorporating new technology into one’s business strategy.
The Entrepreneurial Process
Creativity and Innovation
Ideas, Opportunities, and Innovation
Discuss the attitudes, values, characteristics, behavior, and processes associated with possessing an entrepreneurial mindset
Engaging in successful appropriate entrepreneurial behavior
Discuss what is meant by entrepreneurship and innovation
Overview of Business Activities
The Balance Sheet
The Income Statement
Learn the relation between accounting and economics
Obtain an overview of the principal activities of business firms
Observe the types of information provided by the three principal financial statements
Legal issues for entrepreneurs
Organizing the Business Entity
New technologies, business models, and intellectual property
Understand legal aspects of entrepreneurship
Seek appropriate legal advice
Display a broad understanding of Commercial Law
Salary of an entrepreneur
Entrepreneurs live in the face of risk and danger of losing a whole business if they make a simple yet grave mistake. Seeing successful entrepreneurs gives a false idea that the career is a lucrative one, but it’s only so if the right business tactics and good decisions are made. With that said, a generally successful business brought up from entrepreneurship makes at least around a median annual salary of $60,000.
Since entrepreneurship is a volatile business altogether, there’s no telling what the numbers are in terms of the annual salary at a constant rate. Some entrepreneurs see the constant cash flow that goes well beyond the expected amount, while others will not see that for months to come, which can increase the possibility of bankruptcy and abrupt closure. With that said, it’s estimated that the average annual salary among entrepreneurs varies between $58,000 to $68,000.
The number of jobs created by establishments less than a year old has decreased from 4.1 million to 3.1 million, with the timeframe set between 1994 and 2015, i.e., opportunities in newer establishments have fallen by 1 million in the past 2 decades.
As for the establishments themselves, the survival rate of the businesses has gone down increasingly in recent years. However, this also depends on the industry.
Among the startups that began in 2014, the following percentage of startup businesses failed:
20% in 2015
30% in 2016
38% in 2017
44% in 2018
This can be due to many factors; expectable financial failures such as bankruptcy and cost issues; possible marketing issues such as poor marketing, selling the product at an inappropriate time; or failures that stem from poor handlings such as creative differences among the team, non-accessible product or mishandling customer feedback.
According to the U.S. Bureau of Labor Statistics, there is a boom among entrepreneurs in cosmetology, landscaping and real estate, but the highest rate of failure is in industries where more conservative methods are far preferred, such as agriculture and farming, door-to-door sales, and news. The average employment of top executives is expected to rise by 8%.
Specializations in Entrepreneurship
All of the specializations listed below have their own programs. With a brief look at what each of them cover, we believe you could have a fundamental understanding of what particular skill set you to want to possess and what program to take up so you could become an efficient entrepreneur.
Supply Chain Management
The idea of supply chain management is to teach candidates the fundamentals of product and market forecasting, global logistics, and product distribution. The reason why SCM programs can cater to entrepreneurs is because it helps give the candidate a solid understanding of the backend process of producing, storing, transporting and selling a product.
In many cases, an entrepreneur can feel lost in regards to the intricate control they wish to have over the product’s production. Intermediating on SCM concepts can help mitigate that problem. It is also possible for an entrepreneur to offer a product that makes it much easier for dropshippers to manage their business since the entrepreneur has knowledge on the ins and outs of dropshipping and managing supply chains.
Candidates explore concepts like:
- Inventory Management
- Quality Management
- Supply Chain Data & Performance Analysis
- Wholesaling, Retailing, Transportation and Warehousing
- IT and Logistics
- International Trade, Sales and Market Analysis
Project Management covers the practice of planning, executing and controlling a project’s goals and priorities within the set deadlines. Without an organized process, an entrepreneur can never have an eagle eye perspective on their business, and will feel just as lost as Harry Potter in the third task.
PM can teach candidates how best to approach a business with their product by considering all the available resources at hand, most prominently time and budget. In addition to that, learning about the different kinds of project management styles (Kanban, Scrum, Agile, etc.) can help entrepreneurs dissect what approach is best for their particular business.
On top of this, graduating from a project management program qualifies you to work in almost any industry as there is almost always a requirement for individuals with a solid background in management and business.
Candidates get to explore topics like:
- Global Logistics
- Production and Resource Estimation and Planning
- Commercial Law
- General Management
- Interpersonal Skills and Behaviour
- Risk Management
Public Relations & Marketing
Candidates must realize that in order to gain followers and buyers, they have to retain a good reputation for their company. No customer is ever going to trust their wallets on a defective product or a crooked company. Public Relations plays a crucial role in establishing a favourable public image for the company, and is applicable to media, social media, and other forms of communication.
As an entrepreneur, it’s your responsibility to maintain a good image when dealing in business with other folks; both the audience and potential partners.
Depending on the degree chosen, candidates will explore topics in specific depths, such as:
- PR Writing and Management
- Digital Production
- Strategic Planning and Communications
- Media Studies
- Corporate Planning and Communications
Candidates will understand the fundamentals of marketing to use in their careers as businessmen. They will understand the process of identifying and satisfying the needs of a consumer, and use those needs to attract other similar customers. Without marketing your product to the general public, there won’t be any gain in interest or profit. This will cause the public to turn to a competitor, and that can mean a loss of business from the entrepreneur’s side.
Even though Public Relations and Marketing both share a few similar traits, ultimately it is their focus that keeps them different. Public Relations focuses on building the company, raising revenue through investors, and promoting customer relationships; at hindsight, it’s focused on building the reputation of the company and their employees.
Marketing deals with approaches to selling products, raising revenue through sales and promoting products and services. This caters to gaining financial profit exclusively and does not deal with increasing the reputation of the business.
It is imperative for an entrepreneur to know the fundamentals of both these business aspects to make efficient use of it to make not only the product but also the company known.
Candidates will cover topics in important areas:
- Human Relations
- Business Law & Finance
- B2B Marketing
- B2C Marketing
- International Marketing
- Strategic Advertising
- Enterprise Marketing Management
Entrepreneurs, when they finally make a business, will begin to worry about how to efficiently run a business. This involves planning and executing strategies for operations that involve exposing the product, or engaging in business transactions with other companies or communicating with the audience. Learning about business management can open a lot of doors to an entrepreneur’s approach in leading a company. You will be trained in advertising and manufacturing products and adopting hospitality and approachability towards the targeted audience.
Candidates will also dig into economics, product data analysis such as market value, cost-to-company and data analysis on rival businesses.
Some of the other topics include:
- Business Fundamentals
- Finance and Accounting
Marketing and Advertising
Macro and Micro Economics
Communications and Organizational Behaviour
If you’re not ready to make your own business, then that’s fine! You can still pursue other careers with an entrepreneurship degree certificate in hand.
A business will always need a consultant who can be present at the client site, help identify problems and offer solutions to fix them. Entrepreneurs will deal with problems at a constant rate and make decisions and offer solutions accordingly, which is why experience as a consultant for large firms and organizations can be immensely helpful in understanding what that would be like.
Writing articles about up-and-coming businesses can help establish knowledge on them. Coupled with your existing entrepreneurial business management skills and knowledge, you could chime into your reports to give more insights to the general public on them, making for an interesting and useful read for those wanting to pursue business.
Today, there are two ways you can pursue this career: schools or universities, or online lecturers. Creating online programs for students that teach them the real world, entrepreneurial applications of the core subjects such as mathematics and business management can be a form of passive income as you will be selling programs that were pre-recorded. The disadvantage to this is that the information given can get outdated, so it’s necessary to keep it updated to meet the students’ needs.
Whereas teaching students in classrooms itself can be an incredible experience where you will be responsible for molding the careers of future businesspeople. The downside to this is that it will likely take up a lot of your time as you need to be in the school and spending hours teaching class after class. Ultimately, it’s a routine that can tire you out easily. Most businessmen take up teaching as a part-time gig while pursuing other careers.
Businesses are always looking for skilled individuals to recruit. Recruiters understand what type of individual they require and they understand what they need to look for in a candidate. Since you would possess management and team-building skills, it’s easy for you to point out what skills stand out in a candidate. Recruiters can be vital to an organization, given how a recruiter is trusted with hiring those who they believe fit the needs of the business. If the candidate is not up to the mark after being hired, then it can result in few (or many) factors being affected in a business that promises quality and trust in their products and services.
Events & Conventions
Conventions are the best way for aspiring entrepreneurs to gain insights from other successful entrepreneurs on how they broke into the industry, put out products and found success in their endeavors. Aside from a wealthy knowledge they can gain from that, conventions are also places where entrepreneurs may meet up with other people and possibly make connections and find partners to do business with. For aspiring entrepreneurs, if they are lucky, they may even gain a mentor to help them out in their journey to become one.
Business Certification Courses
It doesn’t hurt to spread your wings in gaining more certifications if it means aiding your business to be as legitimate as possible. Some business courses can dig into the more intricate details of the business that some degree courses can’t, if you can’t afford higher degree programs. It’s a quick and dirty way of understanding these prospects. Not to mention that certifications can display your dedication to making good business to your audience and your peers.
As an entrepreneur, the point about networking cannot be stressed enough. You could say that ‘networking’ is a mantra for an entrepreneur. This is because, without connections, you will likely not see your business going anywhere. Strong connections can make for great platforms through which you can push your product and gain a large following. Your social network will give you all the attention if you are willing to grab theirs.
When starting a business, it’s necessary to keep realistic expectations about your business, for instance, you are not going to make a couple of thousand dollars from Day 1. Loans are what will help you get on your feet, and fund the important aspects of your business, such as marketing and production. Unless you have another source of income, if it is deemed necessary, be mindful of what sort of loan you are taking and figure out if the amount you are asking for to sustain your company is an amount you can afford to pay back in the future.
It’s a volatile business, which requires constant attention and care, with little to no time left to yourself. Even then, entrepreneurship does not necessitate success, even if or when done properly due to the concept of luck coming into play. Therefore, it’s necessary to take any optimism about being a success with a grain of salt. Aspiring entrepreneurs are heavily advised to, if they possess one, keep their ongoing jobs as it will be the main source of income. In fact, entrepreneurship is normally pursued as a side gig, unless it sees enough success. Some entrepreneurial businesses can get big enough to allow for the entrepreneur to consider quitting their day job and being self-employed full-time.
Stand out Skills of an Entrepreneur
Independent and Frugal: Entrepreneurs are generally independent people. They are self-reliant and co-ordinated with their event plans and daily routines. They keep their personal and work finances separate so as to maintain responsibilities in an organized manner. Contrary to popular belief, entrepreneurs don’t spend a lot on materialistic items, and aim to spend their money on things that will help them become more productive.
Business and Risk Management: Entrepreneurs must know how to deal with possible situations where the business may incur heavy losses. This is why in order to look after a business properly, they must know how to build a team, their psyche, and manage them responsibly. Simultaneously, they must make important decisions constantly that may or may not shape how the business, the product or the team operates. In addition to this, risk management is a major aspect to focus on in a business, as there can be factors that can turn the direction of the business the other way completely, such as economic crashes and natural calamities; entrepreneurs must be ready to have contingency plans for this.
Knowledge Seeking: It’s important to have a humble side and accept that you are not and quite possibly never will be completely knowledgeable of all things in business. That is the first step to being a better entrepreneur. As a constantly learning individual, you must be ready to take in any verifiable knowledge, regardless of the source of information. With this ‘open arms’ approach to knowledge, you can grow your business much faster.
Good Communication & Networking Skills: Entrepreneurs are known to be natural at communication. They spend a lot of their time networking with the appropriate parties, looking for either connection to make, or possible partnerships to explore. It’s also important for an entrepreneur to practice empathy since they will need a shoulder to lean on, should they ever incur losses in a company.