Are you sure you can build a successful side business? It’s smart to start thinking along this line while you have a full-time job. Your side business has the potential to become a long-term solution to your financial needs and give you an enriching life experience.
Answering the questions below should give you enough information to create a clear path forward, help kick-start your new venture and help you decide whether or not to go “all-in.”
Are you passionate about the business?
Starting a business isn’t easy, especially when you’re adding it to the effort you’re already giving in your regular job. Making money can’t be your only motive – it won’t be enough to sustain you when you face challenges. You must be truly passionate about your business and its potential in the world. If you want to succeed, you need to love even the process of building that dream from the ground up.
This is a simple but very important question. If you can’t imagine yourself working on your business idea and loving it – less than 10 years from now, you need another idea. It is also important to know the difference between being motivated by something and being passionate about it. The obvious difference is that passion is fleeting and one should strive to find long-term motivators in one’s business.
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What finances and other resources are in hand?
What might you already have that can help advance the groundwork? Many people think immediately of cash or other capital, but relationships can be crucial resources, too. Perhaps you and a business partner could share resources or maybe you know someone who could act as a mentor to advise you during the startup phase. You’ll be surprised how resourceful you can be even when you feel limited. Create a list. Include everything from the people you’ll need on your team to expenses you can’t escape, then calculate the financing required to bridge the gap. Give this question a careful thought and write down every asset you can put to work for your new business.
Another question people ask themselves before they start a business is, “Is this the right time?” The trust is that there will never be a time that feels totally right. But when you want something badly enough, you make time for it no matter what. Starting a business isn’t about the stars aligning and you feeling 100% confident. Starting a business is about your passions and excitement outweighing your fears and doubts.
Who is your ideal customer?
Creating a customer persona is an important step to help you communicate your message clearly, stand out from the crowd and connect with people because you already “know” them. Craft a detailed profile to describe their demographics, their characteristics and their motivations. What’s their age range? Does gender matter? Can you find research to back up your preconceived notions about their psychographics? Do everything you can to discover what they love. At the end of the day, if there’s no audience, there’s no million-dollar idea.
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Which problem(s) will your business solve?
If you’ve done your homework on your ideal customer, it shouldn’t be difficult to identify your customer’s problems and pain points. What are their motives for wanting to resolve these issues, and what might they already have tried?
Answer like this: My product will solve ________. If you can’t answer that, stop there and go back to the drawing board. It’s important that your product solves some needs because that’s what determines the value. The “itch” is your customers’ problem, the scratch is your solution.
Who else has done it and how did they accomplish their goals?
Find someone who already has attained a few milestones on the way to startup success in your industry or a similar market. It doesn’t need to be in the same niche, although that certainly would be preferable. The simplest way to locate these people is to tap your network. Ask around in related groups or do a quick Google search to create a list of names and then work to find degrees of connections you might share in common. This step could take some time, especially if you’re entering a new market or otherwise are unfamiliar with your niche’s online communities.
It is important that before you start your journey as an entrepreneur, you find out about your competition and see what they are doing, and how they are doing it. The information you will collect in this search is of insurmountable value. It will help you create a roadmap for your own business and avoid the otherwise pitfalls in the path.
You can’t play the game if you don’t know the players. Do a simple Google test to see who else is out there doing what you’re doing. Just because someone else is out there selling chocolates doesn’t mean you can’t sell it, too. However, you need to see what the competition looks like in order to decide if you can offer something better.
What’s my ‘special sauce’?
Speaking of differentiating yourself from the competition determines what your “special sauce” is. According to Shark Tank’s Mark Cuban, your special sauce is a quality about your company that stands out from the rest. Your own special sauce can come from a lot of different areas of your company: where it’s made, the unique quality of the product, how it’s made, competitive pricing, a charitable component or your stellar customer service.
Ask yourself, “What is going to make someone purchase my product over my competitors’?” Your answer is your special sauce and should always be included in your marketing.
How will this business make money?
All too often, entrepreneurs and creative individuals come up with grand ideas. Sometimes these ideas even solve important problems. While the good of the world is a great motivating factor, the most important element is whether or not it can be monetized. If your idea can’t generate income, move on to another that can and come back to your goodwill project once you’ve made money elsewhere.
This might seem like a no-brainer, but take some time to think about it. Are you selling a product? A service? Ask yourself why a person would make the decision to give your business money. What are they actually buying? A tool that makes their lives easier? A skill they can use in their future career? An emotional experience? The more you know about your business’s unique selling proposition or USP, the better prepared you’ll be to sell the USP to potential customers.
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What’s my plan for growth?
Where do you want your business to go, once you get it started? What does realistic growth look like over the next year? The next five years? Knowing what a realistic success path looks like for a business like yours can help you set SMART goals and benchmarks to help you get there.
You need to determine if you can afford to build out this business idea and whether you have the drive and determination to go the distance. It often is just about the idea, with little thought to reality. Most entrepreneurs think they can just figure it out as they go. In reality, they need to know in advance.
Does It Work Within the Life I Want to Have?
“Building a business can be a huge time and energy sink and before you enter in, it’s important to be clear about the implications it will have on your life. Are you willing to put in the hours and energy, to suffer the ups and downs, say “no” to other things like time with friends and family or your hobbies? Make sure it’s worth it to you before you dive in.” – Darrah Brustein
What are you going to lose by spending time on a new project instead of your existing business? How much are you prepared to lose by shifting your focus to something else? Either way, you’re losing something, so is it worth it?
Can I Get a Complete Stranger to Buy My Product?
People lie. People lie to their close friends and loved ones. People lie for convenience and to avoid conflict. Your family and close friends might not tell you the truth if it means crushing your dreams. Try selling your product to complete strangers. The absolute best way to hear true feedback is from a stranger who is paying you their hard-earned money.
What Is the Legal Landscape?
Never was the old adage that “an ounce of prevention is worth a pound of cure” more true than when pursuing a new business idea. Before you invest any time and money, first check-in with a lawyer to make sure you understand what you will be legally required to do when pursuing your idea and the ongoing legal costs and risks.
It’s not enough to have a good idea, even one that’s potentially very profitable. Your idea has to arrive at the right time and be so persuasive that it’s hard for customers to say no to.
Let’s sum this all up into a short checklist:
- Can you describe how to turn your idea into action in one sentence?
- Is there an obvious way to make money with this idea?
- Does this idea solve a problem for someone?
- Can you figure out how to make this idea happen quickly?
- Is it relatively low maintenance?
- Can you get paid more than once for this idea?
The more “yes” answers you have to these questions, the more potential your idea has. And the more potential it has, the faster you should get to work.
As Lao Tzu said, “The journey of a thousand miles begins with one step.” Don’t be afraid to start somewhere because one day, you will get to where you want to be.