By Elizabeth Aldrich, Lendio
Going from side hustle to full-time entrepreneur is scary yet exciting. If you’ve been considering the move lately but feel overwhelmed and unsure of where to start, follow these simple steps to get your business up and running in no time.
1. Save up an emergency fund
Going full time and giving up your day job is scary, but you can ease your worries if you save up an emergency fund in advance. Having a financial cushion is important when you’re starting and income is unpredictable.
Most experts suggest having six months of your bare minimum expenses saved up, and that’s a good place to start. If you expect your income to be volatile or you think it’ll be a while before your business gets off the ground, you might want to save closer to nine months—or even a year. Having this money will give you peace of mind. It will also give you the ability to dedicate yourself fully to your new venture without compromising your vision to make money quickly.
2. Get your ducks in a row
There are a few logistical tasks you’ll want to take care of before going full time so that everything runs smoothly for years to come.
- Legal structure
You should set up a small business checking account first, even if you’re not bringing in any money yet. Separating business and personal finances is the first step to optimizing your business finances and will save you a lot of time and money come tax season.
Speaking of taxes, you’ll probably want some accounting software to help you track your business expenses and revenue. QuickBooks offers smarter business solutions for the world’s hardest workers (that’s you!), not to mention affordable self-employed and small business versions. Consider hiring an accountant as well.
Finally, you’ll want to decide on a legal structure. If it’s just you, you can continue working as a sole proprietor and avoid extra paperwork and fees. However, many entrepreneurs and small business owners prefer to register as a limited liability corporation (LLC). Doing so legally separates you from your business, protecting your personal assets in the case of serious debt or legal troubles.
3. Create a business plan
Even though your vision will likely change over time, it’s important to have a clear idea of where you want to go with your business from the beginning. Clearly define your mission, goals, and target audience. As you do this, don’t be afraid to get specific—most people tend to define these things too broadly and then try to do too much in the beginning. Honing in on a smaller target audience and specializing will help you stand out and get off the ground quicker, after which you can look toward expanding.
The best way to envision your business’s future is to experiment a little and figure out what works. Chances are you’ve already been doing this with your side hustle. Once something works, figure out how to duplicate it and scale it. Make sure to come up with a strategic financial plan for your business as well.
4. Create a website and social media accounts
A solid online presence is a must for all small business owners. It helps people find and contact you, shows that you take yourself seriously, and serves as a digital resume for you and your project. Make sure your website is easy to navigate, professionally designed, and typo-free. You might want to hire a copywriter to help you develop web copy that sells, a photographer to capture you or your products, or a graphic designer to create a logo. For social media, start with one or two platforms, so you don’t get overwhelmed. Consider using a social media scheduler to automate the process or hire a social media manager.
If you don’t have a website yet and you’re on a low budget, you can create one cheaply with platforms like WordPress or Wix. Make sure to at least pay for hosting and a custom domain name. Even folks with a budget might want to consider hiring a web designer from a freelancer marketplace like Upwork. Below are some common prices for services you might need.
- Web copywriter: $200 to $500 per website page.
- WordPress developer: $20 to $100 per hour, with a simple WordPress site taking between five and 20 hours to complete.
- Graphic designer: $20 to $150 per hour, with a logo taking five to 20 hours to complete.
- Social media manager: $200 to $2,000 per month, depending on how much marketing you want them to do for you.
5. Increase your prices
One of the biggest mistakes new business owners make is undercharging their customers. Most commonly, they undercharge to attract new business or because they don’t feel like they have enough experience to charge full price. However, you’re losing out on revenue and clients by doing this. Customers might actually be deterred by a business that charges rock-bottom prices because they’ll assume you aren’t offering quality.
As long as you have some work samples and experience, there’s no reason to charge less than the market rate for the goods or services you’re delivering. If you’re finding it hard to attract new customers or don’t yet have much work to show off, consider offering a limited-time discount rather than lowering your prices indefinitely.
6. Build your network
Just because you’re on your own doesn’t mean you should go it alone! Surround yourself with people who have made their dreams a reality, and you’ll have a constant source of inspiration, motivation, and wisdom.
Start by researching other small business owners who are already doing something similar to what you want to do. Look into their business’s history, follow them on LinkedIn, Twitter, or Instagram, and figure out how they made it happen. Then, sign up for conferences and other networking events in your industry to make real-life connections. You can also look into coworking spaces and entrepreneurial events in your area.
7. Expand your customer base
When it comes to your bottom line, the key to going from side hustle to small business is simple: Increase the quantity and quality of customers you work with. Since you’ve already honed in on your ideal customer, seek people who fit that profile online and build a list of leads. Reach out to them by cold calling or sending an email or LinkedIn message. It will take some time to develop and tweak the perfect pitch, so don’t be discouraged if you don’t get a lot of positive responses at first.
There’s no time like the present
In the end, every entrepreneur’s journey is different. Some people choose to get funding right off the bat with a small business loan or a grant, while others build up their business on a shoestring budget. The most important thing is not to let an endless to-do list or a sense of perfectionism get in the way of getting started. If you’re wondering when to leap, the time is now.