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I was 23 years old when I launched my first business. I had no idea what to expect. I knew nothing about tax paperwork. All I knew is that I had a working laptop and that I could write.
I’m not all that special. According to research, as many as 627,000 new businesses are started every single year. Of this number, a whopping 85% will most likely fail within 15 years. This fact is extremely concerning, especially as a business owner. What happens between the passionate fire when starting something new and that sullen date of failure? And, what is the difference between the businesses that succeed and the ones that fail?
I’ll tell you: Preparation.
If you’re looking to start a business in your 20s, you need to be prepared for the worst (and I mean the worst). There are lots of people who go into business without any preparation whatsoever — and that’s much more dangerous than most people realize. In my opinion, lack of preparation is the leading cause for business failures.
I made the jump into business ownership because I knew my ducks were in a row. Even if the worst came to pass, everything would be okay. That’s how I knew it was time to start — and it might help you know when to start, too.
If you’ve got the itch for entrepreneurship, or even if you’re just a little curious, it all starts with preparation. And this list will help you get there!
Stack Your Bank Accounts
Money makes the world go round — and your life, for that matter. If you run out, or run a little short, you’re going to struggle.
Conventional wisdom says you should have an emergency fund of three to six months’ worth of expenses. This means enough money for bare-bones living, without all the fancy bells and whistles. Think rent, electricity, water, and your monthly food bill.
I saved a full six months’ worth of expenses before I delivered my two weeks notice. I also had a full health insurance plan, auto insurance, and a small investment account as well.
If you don’t have a massive stack of money, don’t sweat. It’s a marathon, not a sprint. If you’re willing to start stocking up today, you’ll be set in no time.
Talk to Smart People
Let’s face it, there’s always someone out there who’s smarter than you. If said person also happens to have experience in your industry, you’ve possibly struck gold!
97% of mentees believe having a mentor (i.e., smart person) is an asset to their lives. I don’t know what’s up with the other 3%, but I’m sure they’ll come around.
Before I launched my business, I sat down with as many people as I could to glean information about the field, clients, and business life in general. I met with freelancers who had been in the biz for 20-plus years. I sat down with tax planners and investment pros to help guide me through the minefield of business money management. Finally, and most importantly, I joined local clubs and groups that reflected my industry goals.
Look for a mentor in your area and try joining some interest groups as well. Above all, don’t be afraid to ask questions! You might be surprised by how much folks want to help.
Stick Your Toes in First
Remember how you used to test water temperatures as a kid? Just one or two toes in the pool at first, right?
Now, apply this to the business world. Who said you had to jump into full-time entrepreneurship right off the bat? I didn’t. I doubt anyone else told you that, either. And if they did, you can go ahead and disregard their advice, because it’s just plain bad.
I ran my career as a side hustle for three years before I ever considered going full time. I already knew I had a solid client base, and I was even turning away work just to make some wiggle room for my full-time job.
Don’t be afraid to run your business on the side. Once your side hustle starts making you money equivalent to or more than your full-time job, it could be time to consider a switch.
If you want to open a business in your 20s, I want you to know that it is possible. If I can do it, you can do it. Contribute to your savings account, chat with smart folks in your life, and most importantly, go slow. If you’re willing to learn, and willing to be patient, I know you’ll have the ability to succeed.