Many people love the stability of a traditional job, but true entrepreneurs won’t feel inspired unless they’re working toward building their dream. Many aspiring entrepreneurs can’t wait to quit their job to start a business of their own.
Maybe you dream of becoming the first female entrepreneur in your family. Or maybe you’ve found an innovative solution to a common industry problem. Whatever your motivation, as an entrepreneur, you not only get to work for yourself, you get to manifest your vision into reality.
There are many characteristics of entrepreneurship, but one of the most important is dedication. Becoming an entrepreneur requires hard work and commitment to a well-defined, yet flexible, process. You won’t become a success overnight. Planning the early stages of entrepreneurship to help see your vision through is essential for all aspiring creators and business owners.
Whether you have a new product idea designed to disrupt the marketplace or see a new need your business can fill, you’ll have to follow a set entrepreneurial process in order to turn your concepts into reality. Keep in mind that while these stages of entrepreneurship are often sequential, their time spans might overlap. In some cases, it might even make sense to jump ahead as long as every stage is eventually completed.
6 stages of the entrepreneurial process:
- Brainstorm and explore
- Get organized
- Build your network
- Form your business
- Find investors and partners
- Market and launch
1. Brainstorm and explore
This is typically the starting point for all entrepreneurs. Businesses are usually founded on one idea or solution that sparks an entrepreneur into action. This entrepreneurial concept might be the reason you decided to form your own business in the first place. However, this isn’t the only way business ideas are born.
Many entrepreneurs might know they want to start their own company, but they struggle to decide what service or product they can offer the marketplace. If this is the case for you, you’ll want to begin brainstorming right away.
Start by identifying different industries and narrowing them down based on your interests or expertise. From there, you can begin generating ideas as they come to you or start researching common industry problems to solve.
However you tackle this step in the process, it’s important to schedule time each workday to spend on ideation. Once you have your idea, you’ll want to nail down some specifics and begin prospecting. Whom is this product/service for? Who is your target audience or demographic? How much will this cost your prospects? Nail down as many specifics as you can before moving forward.
2. Get organized
Now that you know what you’re looking to build, you’ll want to get to work right away. You’re going to want to come up with a business plan detailing your business goals and projected revenue and may decide to craft a mission statement.
The next phase of your entrepreneurial plan should involve researching the market to be sure no competitors are offering the same product or service. If they are, make sure your offering has a compelling differentiator or key advantage over the competition.
You can also begin building out some of your brand messaging to show customers how your product or service works and why it's worth their time and money. You’ll need to know how to market yourself, which is one of the key entrepreneurial skills, before you move on to the next stage.
3. Build your network
To become an entrepreneur, you’re going to need a wide network of connections. It’s important to connect with other professionals and experts in your industry, particularly if you’re looking for partners, mentors, or just associates to keep in touch with. It can be essential to interact with like-minded individuals who share your business interest or perhaps experience the problems your company will be setting out to solve.
You’ll also want to begin branching out and networking with other professionals, such as lawyers, financial advisors, and entrepreneurs in other industries. Consider what types of vendors you’ll need and begin connecting with them as early as possible. You can also use this time to scope out potential employees.
4. Form your business
You’ve got the idea, you’re armed with research, and you have the connections. Now it’s time to legitimize your dreams by building your business. You’ll want to form an official company or startup and register your new business with the government. Before filing your paperwork, create a list of potential company names. You can check the availability of these names when you begin the business creation process.
Whether you’re starting an online business or seeking a more traditional business model, you’ll need to decide the type of business entity you want to form (LLC, corporation, partnership, nonprofit, etc.) and file the required paperwork with your secretary of state. You should also obtain an Employer Identification Number (EIN) and open a business bank account.
At this point, you can also get your business ready for marketing by ordering business cards, reserving a website domain, and creating business email addresses to make sure your company looks polished and professional. You should also decide if you want to hire an accountant or tax specialist.
5. Find investors and partners
A million-dollar idea remains just that unless you have someone to fund it. Now that your business is formed and recognized by the government, it’s time to begin finding the financing you need to launch your big idea.
There are many different approaches you can take during this stage. You can reach out to the professional connections you’ve made to form partnerships or offer shares in your company. You can also contact any wealthy individuals you may be personally connected with to gauge their interest in investing in your idea.
Another recent method for raising startup money is crowdfunding. Using platforms such as Kickstarter, entrepreneurs are able to raise awareness of their product or service while also promoting their brand. In exchange for capital, you can offer patrons exclusive access to your products and additional gifts, rewards, and discounts.
When crowdfunding, it’s important to create a compelling story that resonates with your audience. This might mean manufacturing a product demo and shooting a video promotion, or it could be you telling the story of your marketplace solution.
6. Market and launch
Now that you have capital, it’s time to get your startup ready for the product or service launch. This could involve hiring employees, contractors, or vendors, working on initial manufacturing and development, and running your products through tests and quality assurance processes. You may also need to secure office or manufacturing space.
If you’re crowdfunding or still raising money during this period, offering glimpses and updates of your progress along the way can lead to even more investment.
As your product or service is being developed, you’ll also want to start marketing to prospects. This could involve building a website or e-commerce site, creating social media hype, launching digital ads, or using traditional media to start attracting customers.
Now you’re ready to officially launch your new business. Congratulations!
Your next move
An entrepreneur’s work is never done. You might focus on scaling your business for future growth, brainstorm new product or service lines, or turn your attention to your next bold business idea and complete the entrepreneurial cycle all over again. Use this six-stage process to help you plan out your next move confidently every time.
Alert: highest cash back card we've seen now has 0% intro APR until 2025
If you're using the wrong credit or debit card, it could be costing you serious money. Our experts love this top pick, which features a 0% intro APR for 15 months, an insane cash back rate of up to 5%, and all somehow for no annual fee.
In fact, this card is so good that our experts even use it personally. Click here to read our full review for free and apply in just 2 minutes.
Our Research Expert
We're firm believers in the Golden Rule, which is why editorial opinions are ours alone and have not been previously reviewed, approved, or endorsed by included advertisers. The Ascent does not cover all offers on the market. Editorial content from The Ascent is separate from The Motley Fool editorial content and is created by a different analyst team.
The Ascent is a Motley Fool service that rates and reviews essential products for your everyday money matters.
Copyright © 2018 - 2023 The Ascent. All rights reserved.