8 Top Tips for Young Entrepreneurs
Online start-up businesses run by young adults are an increasingly common phenomenon. A commonly overlooked demographic, however, are the real youth — those under 18 years of age. With online businesspeople facing very low barriers to market entry, many tech-savvy kids are getting in on the act and taking advantage of the opportunities that abound. While these entrepreneurs are more the exception than the rule, some of their successes are highly notable — myyearbook.com was initially founded by two high-school students, yet at one stage was the third-most popular social networking site in the United States, behind MySpace and Facebook. Of course, Facebook’s Mark Zuckerberg was still in college when he established one of the most popular social networking sites in the world.
Sadly, these successes aren’t as common as they could be. While the world has countless enthusiastic young people with ideas and technical skills, there are many challenges facing these youthful entrepreneurs. These range from the natural — Venture Capitalists (VC) disputing their expertise, for example — to artificial (such as the age restrictions placed on credit card services that might otherwise be used to pay for start-up resources). Here are some tips for the technically-minded young entrepreneur — both the aspirant service provider and the ambitious salesman — to help them overcome these challenges and succeed in their ventures.
1. Be ready to handle the challenges of a business.
Running a business isn’t easy. With customers to deal with, clients contacting you at any hour of the day, products to maintain and possibly even staff to manage, operating a business is very intensive. Before you begin anything, consider whether or not you really want to be in business. Running a business isn’t for everyone — you may be technically minded, but running a profitable business is a different thing altogether. Look at the market leaders — Google, for example, is managed by three people: two technically minded founders, plus an experienced professional in the business-oriented role of CEO. Still, if you have an idea, and you really want to go into business with it, don’t give up now. You just might it make it big!
Another important issue you will have to deal with is time, or a lack thereof! With school, work, and everything in between, you could soon find yourself trying to get through 30 hours of work every day. Running a business is more often than not a full time job, and at some point, something’s got to give. Think about where you want to go in life, and make your decisions accordingly. For example, you could be part of a sporting team, or you could go into business, but you probably can’t do both. Often co-curricular and non-school (where applicable) involvements are the first to go; to maintain your social involvement, consider attending user groups, where you can also network and create opportunities for your business.
2. Plan your idea on paper and be ready to explain it to others.
When you’re running a small business, opportunities can come up at the most unexpected times. You may run into a potential client at a party, a conference, or even a bus stop. You can’t let everyone know about your new product or service but the more people who do know, the more opportunities you’re likely to get, and therefore the better your chances of making it through your first few months in business. Get the word out — you might just chance on a recommendation to a potential client!
Work out your business model and the most useful, concise description you can come up with for your goods or services. Let me take this opportunity to recommend my ingenious patent-pending project management system — I call it Pen and Paper. Working out a plan with pen and paper is often far more effective than typing it up, and gives you more time to think it out while you write. Be ready to explain your business to anyone at any time; with this plan in hand, you shouldn’t have any problems. Without a plan, your explanations can end up being inconsistent, sounding unconfident, and achieving little or no effect.
Get business cards printed and carry them around. I’ve been handing out cards since I was 13, and they’re very effective client-winners. At the very least, they give you something on which to scribble the contact details of potential clients. If you bump into anyone who might be in the market for your goods or services, let them know what you do; briefly explain your business using the plan you prepared earlier and give them a card. When you meet in person, some people simply won’t take you seriously; a business card demonstrates that you’re serious about what you do.
3. Make good use of all the resources available to you.
Often, young entrepreneurs don’t have a lot of capital, but there are still many resources available to you. For example, if you’re building a web application for the financial services industry, do you (or more likely, your parents) know any accountants of economists? If you need to quickly undertake a photo shoot for an advertising campaign that a friend has offered to help out with, could you set something up in your parents’ garage? For some, imposing on friends and family to help get things moving can be awkward, but learning to take advantage of the available resources is going to give you a huge advantage as a young entrepreneur.
Lack of access to capital can often become a challenge for young entrepreneurs — basic business development resources such as ad campaigns can become a problem if you don’t have a budget. With a bit of thinking, however, many of these problems can be alleviated by taking advantage of the resources at hand.
4. Build your product to be as complete as possible before seeking financial assistance.
So, you’re developing your whiz-bang product, and suddenly you realise that the Flash charting library you’ve been using in your application actually costs $1200 for commercial use. You pick up the phone, call Uncle Rob and ask if he can lend you the cash. He politely declines. A series of calls to your other relatives end in a similar fashion.
As an entrepreneur, you have ideas with a lot of potential. Just as you will eventually sell your product to potential customers, selling your product to potential financial backers is even more important, and this makes explaining and clarifying those ideas a priority. Develop your product as much as you can before seeking financial support; if possible, put together a demonstration video. The more you can demonstrate your idea, the more convincing you’ll be. Building on the advice that we discussed in point 2 above, potential financial backers — especially venture capitalists — are very important to the success of your business, and deserve an appropriate amount of your attention.
5. Maintain a professional communication channel.
When dealing with clients, you may find yourself working with mature professionals who are high up in their respective corporate hierarchies. Getting them to take you seriously is the tricky part.
If at all possible, live locally, but work globally. Run your life in your local neighbourhood, but until you’re older and feel confident to deal with clients in person or over the phone, you might consider restricting your customer base to offshore clients (although for US-based entrepreneurs this isn’t always an option). Assume the role of a mature industry professional, and you’ll be treated like one. When you go professional, age won’t matter unless you make it matter. Preparing stunning introductions and speeches always helps for the times when you have to work locally; keep a standard speech in mind and make sure you can deliver it confidently as needed.
When you’re working globally, keep communication to email — definitely don’t offer instant messaging as a method of communication. With email, you have a chance to gather your thoughts, and to work out how to respond to clients. As a young entrepreneur, you often have to tread carefully and make sure you don’t lose anyone from your limited customer base. With email, you can take the time to prepare a professional response that conveys your intended image. Instant messaging should be avoided at all costs, especially if you plan to contact clients using the same instant messaging profile you use to contact friends — this creates all sorts of opportunities for revealing your lack of experience.
6. Monitor progress and keep track of tasks.
The last thing clients want is for you to miss a deadline because you were out on a date or partying with friends. Keep a reasonable separation between your professional and social lives — the so-called work/life balance — but keep track of your progress in your life as an entrepreneur, and maintain a close eye on your daily operations.
Often a dedicated calendar and marker pen are sufficient, but develop a system that works for you and allows you to keep track of deadlines, pending tasks, and goals. Importantly, establish many goals, and give each a definite deadline; then make sure you achieve these goals within the time frame you have given yourself. Of course, this is easier said than done, and requires a lot of self-discipline.
Make sure you keep an eye on the big picture, of course. Work out when you expect to start generating revenues, when you want your products and services to be ready, when you aim to secure your first customer, and so on. If you see progress in general sliding, consider putting in a few extra hours here and there, or (if possible) hiring some help — reliable offshore freelancers are plentiful, and the kid next door might not mind helping you out here and there in return for a bit of pocket money (although again, this might be a bit too close to home).
7. Be prepared to fail.
Let’s be honest — most start-ups just don’t take off. However, this eventuality shouldn’t be confused with "failure." Every time you start a business, you gain a new raft of experiences, extend your skill set, and learn valuable lessons for your future enterprising.
In the event that your business doesn’t make it big, and you end up pulling out of it, look back on what you’ve learned and consider what you plan to do next time. Chances are that you intend to start another business in your lifetime; when you do, you’ll be one business the wiser, and ready to deal with new challenges. There’s always another opportunity; dust yourself off and keep on going! You haven’t failed; you’ve progressed.
8. Have fun!
You might have built a fantastic product and sold it to half of your target market. Perhaps it even made you rich and famous and put you on the cover of TIME magazine at 16! But at the end of the day, the question is: did you have fun?
It may be the case that your product doesn’t take off, you can’t find any suitable buyers, or the world simply isn’t ready for your product or service. In any case, always keep an eye on the big picture, and make sure you enjoy what you’re doing. Entrepreneurialism requires a lot of enthusiasm — you can face some serious challenges if you don’t take pleasure in your daily business activities.
If you’re thinking of starting a business, there are many excellent resources at hand. A quick web search turns up hundreds, but the following might be of special interest to you: