The Basics of Starting Your Own Business

Starting your own business may seem the perfect way to attain the freedom you desire, the ability to work for no one but yourself, to make your own hours, travel and embrace all the liberties working solely for yourself provides and while occasionally - a long way down the track, that may be the case, the reality is that you'll be working far more than you ever worked before, barely getting any sleep, struggling to pay bills and not drive yourself entirely to the brink of madness and exhaustion, all while trying to build a brand and with it, a reputation. 

The good side of it though is enough to make you forget the bad parts, to gloss over them as if they were your 'blue period' among the chronology of your starling historic rise to success. Waking up each morning raring to go, having no such thing as a mondayitis, or dreading the weekdays - you'll work everyday and work ridiculous hours because it's for yourself. 

Being able to see how each step you take each day affects your overall strategy is empowering and motivating and pushes you that much further. 

Now that you're mentally prepared, let's chat. 

So! - You want to start a business, you have a great idea and no clue what to do with it, here goes: 

Research: 

Conduct extensive research before looking into domains and company registration - your idea needs to address a gap in the market that isn't being filled or could be filled by your idea in a much more effective way. It has to be feasible and profitable (yes, even non-profits are required to be profitable). Ask how you will make money, the kind of money you can bring in, what will you charge? Who is your competition? How are they doing it? What are they charging? What is your point of difference?

If it seems like there's an obvious gap that isn't being filled, research potential reasons why as you'll usually find one. Don't be afraid to actually ask your competitors, especially the big ones who won't be phased in the first instance by your one woman band (until you overtake them in your significantly swift rise to the top of course) and will be willing to share more information than a direct solopreneur competitor who relies on every cent on her income.

Read business books, read biographies of people in business, read what works, research what works and what doesn't, read people struggles and the necessities of business. Prepare and overprepare and then overprepare some more. Make sure that you know your business and your industry inside out. Live it. Eat it. Sleep it. Breathe it. Know it.

Overbudget

What will it cost you to start the business? What will it cost you personally to survive through rent, bills, living expenses etc for say six months to a year? How long did it take for your competitors to get a steady income? 

You will need to be financially prepared to rely solely on yourself and your savings for a while....perhaps a long while. Initial surges in customer activity make us think we're ahead of the game so we pick up our spending accordingly, but initial activity can often die off just as swiftly as it came in so you should be as frugal as possible during this first year. Most small businesses will fail within 18 months - within 6-12 months if it's a hospitality business - due to poor financials so make sure you're prepared - overprepared for all contingencies and work in a failsafe as a precaution, for instance, taking on part time or contract work to fill low-income periods while still allowing you enough time to work on your businesses.

The Logistics

Once you've done your research and you've decided it's a legitimate business idea with profitability and financial backing, it's time to get organised. 

Firstly, register your company name through the Companies Office. It's $25 to reserve a name while you make sure it's what you really want to call your business and to check it doesn't already exist and then $150 to actually register it. 

Detemine what kind of business you'll have - will it be a Limited Liability Company? (Ltd)? a Partnership or will you be a Sole Trader

You can select here whether you want to register for GST - which you don't have to do unless you'll be earning $65,000 per year or more but having a GST number does lend more credibility to your business and some clients will even require it in order to pay you so just tick the box.  It'll be the same number as your company's IRD number so it's very straightforward. 

There are a huge amount of fantastic resources available for helping you assess the feasibility of your idea and your readiness to launch.

Be Prepared

Like we mentioned right at the start, entrepreneurship is NOT easy. You will be working late basically every night, you'll forget what weekends are, you'll eat more ramen noodles and tap water than you'll ever want to see again and you'll likely get about as much sleep as a new mother, about two weeks home from hospital. If you're not experiencing these things, you're not working hard enough.

It may be that your idea is amazing, you have financial backers or investors and you can afford to order in pizza every other night and that's great - thousands of struggling solopreneurs are feeling pretty bitter right now as they hug their bowl of ramen for warmth - but you still need to be prepared for the worst. 

On the flip-side though, you need to mentally put yourself into a positive, fulfilling mindset built on a foundation of optimism and the strive for success. You need to believe you're already successful, that you're already surrounded by so much money and success, that you have clients banging down your door, clamouring to collaborate with you. This mindset will help dramatically when you're feeling low. 

Sign up to every motivational or inspirational feed you can find. Constantly surrounding yourself and seeing these positive images is a constant reinforcement of success and positivity. Yes, it sounds hokey, but it's actually highly effective.

Self-Promote, Sell, but Don't Sell-Out

Here's where it gets uncomfortable, if you're an introvert and the idea of working from home was great because of the solitude, you're going to need to develop your work face. An entirely different persona that is self promoting, self assured, self confident and sassy, and which can sell your services, your brand and you better than Ron Burgundy can sell the news.

It's a difficult notion to get your head around but it's an important one. There's a line too though between selling yourself and selling out when you find easier ways to make money that aren't particularly in line with your business plan. Marc Ecko wrote a great book for this, 'Unlabel': Selling YOU without Selling OUT. It's a very frank and honest look at branding and building a business and the person you need to become to make it a success but also the pitfalls, the easy ways out, the hard ways back and the importance of authenticity.