So You Want to Start Your Own Business...

When I was in elementary school and dreamed of being a businesswoman, I crocheted two squares, sewed them together and created a little Tiffany Money Purse. I sold them at school for $5 each.

It wasn’t exactly the most sophisticated way to start a business, and there are some lessons from that venture that are just as relevant today.

Recently I’ve noticed a lot of my friends are trying to convince their husbands to allow them to start a business, and those initial discussions don’t usually go very well.

There is often skepticism, tension or outright dismissal of the idea by the husband or partner.

Any woman who is seriously thinking about starting her own business should do these 6 things before even mentioning it to her partner or spouse.

1. Hone your idea — You’ve noticed a need or a gaping hole in the marketplace, and it inspired your idea for a business that could solve it. Women tend to be more observant about these things because they make 70% of the household purchasing decisions, and that’s a great advantage for spotting problems that we would like to develop solutions for. A couple examples of women who nailed this:

   1. Lara O’Connor Hodgson was frustrated with slow-paying customers and that inspired her to start NowAccount, which removes cash flow headaches so entrepreneurs can focus on growing their businesses.

   2. Sara Blakely wanted footless support hosiery to smooth out panty lines and bra lines underclothes, and she cut the feet off pantyhose with scissors to make prototypes. Naysayers said women would never buy footless pantyhose, but Sara knew that other women like her would love having discreet shapewear. Spanx is now one of the most successful intimate apparel companies in history.

2. Write a business plan — Now that you know what your business might do, sit down and write a business plan. What will your startup costs be? Who are your potential customers? How crowded is the competitive marketplace, and what are your differentiators that make you better than those guys? What are your realistic revenue and income projections for the first three years? What changes do you need to make to your household budget or spending to accommodate lower income in the first few years?

3. Get advice from other trailblazers — Talk to friends who have started their own businesses. Get their insights, wisdom and advice on pitfalls they wish they had avoided. Ask about the rates at which their revenue and income grew, versus what they expected. Take all those brilliant insights and go back and revise your business plan.

4. Understand the tax implications — Starting a business can reduce your taxes, but the type of entity you choose matters. There are also tax incentives and other federal, state and local small business programs that can give you beneficial tax deductions or low-cost loans. Meet with a CPA or financial planner to understand the tax implications of your business idea.

5. Now talk to your partner — Now that you’ve done extensive research and have a more informed handle on what it involves to start your own business, you will have more confidence to pursue it, convince your partner to support you, and make better decisions about whether this is the right path for you.

6. Consider the side hustle — If you still have doubts or reservations, consider dipping a toe by doing some of the work you aspire to do as an entrepreneur as a “side hustle” or nights and weekend project. This can be a great way to gain insights on whether you enjoy it, whether the revenue is there, and whether it’s feasible as a new business.

Small businesses are the backbone of our economy, and companies with fewer than 20 employees make up about 90% of businesses in the United States. Being an entrepreneur can also be a great way to build long-term wealth and help others achieve their financial dreams.

Starting my own business was one of the best professional decisions I’ve ever made. It was the right thing at the right time for me and my family.

Is it the right thing for you? Start doing some homework to find out.

Want to discuss further? Reach out to me at tiffany@wealthengagement.com