First-time entrepreneurs: Boldly stepping into the unknown (Part 1)

So, you want to be an entrepreneur, but have no clue how to start or what to expect?

Entrepreneurship is definitely en vogue at this time. Educators are grappling with how entrepreneurship can be introduced into curriculums. Many books and magazines are published on entrepreneurship. There are even reality TV shows like Dragon’s Den.

I agree that more financial education, including entrepreneurship, is not only good, but necessary. However, being an entrepreneur is not for everyone and certainly not for the faint-hearted. In this first of two posts, I will provide some thoughts on how to get started, what to be aware of and dos and don’ts.

What do you think of when you hear the word entrepreneur? For many this conjures up a dream of becoming the next Larry Page, Elon Musk or Mark Zuckerberg. However, entrepreneurship follows the axiom that success is 10 per cent inspiration and 90 per cent perspiration. Setting your sights on what you can control and working hard to achieve it has the greatest opportunity for success.

So, how do I get started?

This might seem obvious, but the first step before venturing out as an entrepreneur is to make sure you have a product or service to sell. Three questions to ask yourself:

  • Do I have a skill others are willing to pay for?
  • Can I buy or make a product at a price that allows me to sell it at a profit?
  • Do I have an idea that, if developed, could turn into either of the two above?

If you can’t answer yes to at least one of these questions, you should avoid the risk and effort of becoming an entrepreneur.

Your next step is to write down and explore your ideas of the products or services you feel you can provide. This can be for a service missing in the market, like when Reed Hasting started Netflix because he didn’t like being charged a late return fee on a movie rental. Or this can be for a missing product, like when Steve Jobs literally showed there was a computing gap between the iPhone and the iMac at the 2010 Apple event, thereby creating the new tablet category with the iPad.

The majority of entrepreneurs in North America, however, start in existing markets. This can be highly successful as long as an existing market has room for another competitor. Think of the many fast-food chains, trades based businesses (e.g. carpenters), professionals (e.g. accountants/lawyers) and many more.

Now you can move ahead to questions like:

  • Do I have potential customers/clients identified?
  • Do I have the money or borrowing capacity to start?
  • Am I willing to risk the money I have?
  • Can I make the time commitment to build the business?
  • Do I know professionals (lawyer, accountant, other) who can help with the set-up?

Starting in an existing market has a greater guarantee of success, which means there is less risk or, at least, the risk is better understood.

Stay tuned for my second post for thoughts on what to be aware of, as well as the dos and don’ts of entrepreneurship. 

Keep the conversation going

What else would you like to know? What is preventing you from making the leap?  Post a comment below.

Disclaimer

The views and opinions expressed in this article are those of the author and do not necessarily reflect that of CPA Canada.

About the Author

Bernard Grobbelaar, CPA, CA

Partner, Oikonomos Chartered Professional Accountants
Bernard is the founder of Oikonomos Chartered Professional Accountants, a full-service accounting firm. Oikonomos services clients in five areas: tax, accounting, outsourcing, consulting and assurance. Bernard has experience serving public and private companies, as well as not-for-profit organizations. As a husband and father of four, he knows the challenges that come with building a business.

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