The appeal of being an entrepreneur is undeniable. With 90% of new American billionaires being self-made, it’s easy to gravitate towards entrepreneurship. That’s especially true when considering how many entrepreneurs were successful during the pandemic, a time when economic hardships were evident everywhere.
Despite the financial obstacles people and businesses faced during the shutdown, Forbes added 493 new billionaires to its list of richest people in 2021. The annual list included 88 American newcomers, most of whom were self-made. These additions are why new and young startup leaders have more reason to believe that creating a business in the right industry can have significant payoffs, enough even to survive economic turmoil.
But these successful examples don’t negate the obstacles that many entrepreneurs face. Starting a business isn’t easy. In fact, several challenges tend to prop up, including the five below.
1. Figuring out what to sell
You can have all the leadership skills and passion in the world, but if you don’t know what to sell and, more specifically, what products or services are in-demand, you can’t be a successful entrepreneur. It’s not good practice to enter any industry without a plan. For your startup to thrive, you must know the needs of your target audience and sell products or services that alleviate them.
2. Securing funds
It’s one thing to have a business idea. It’s another thing to fund it. When starting out, you may be in a situation where you’re working with lower capital. In those cases, you have to generate funds, and the work you must put in to do so can be tiring.
3. Staying on budget
When starting a business, it’s easy to think that any and everything is necessary when in reality, you don’t need all the bells and whistles to succeed. Still, many entrepreneurs can struggle to maintain a budget because they want to put money towards every marketing and sales strategy and software they don’t need.
4. Hiring employees
One of the biggest challenges entrepreneurs face is hiring the right people and putting them in the right roles. Finding great employees requires writing the best job descriptions, offering benefits that attract top talent, asking the right questions during interviews, and ensuring the people you bring to the team are a good culture fit. Overall, it’s a tall task that some entrepreneurs struggle to handle.
5. Growing the business
After starting a business, the next step is to expand it. Completing this milestone can be one of the most difficult responsibilities for entrepreneurs. The task forces you to focus on various things like bringing on more potential partners, brainstorming ways to address bigger demands, re-evaluating your role in the business, and revising existing processes to meet new needs.
How to overcome entrepreneurship challenges
If you’re an entrepreneur or hoping to become one, all hope isn’t lost. There are ways to overcome common entrepreneurship challenges. After all, the success of so many entrepreneurs proves it’s possible to overcome even the most difficult issues.
Keeping that in mind, if you want to have a great entrepreneurial journey, don’t feel discouraged by the problems that could appear. Following the right steps can help your business stand tall long-term. In fact, here are tips you can use to alleviate the five challenges mentioned in this article.
1. Research and self-analyze
When determining what products or services to sell, don’t rush the brainstorming process. Instead, approach it thoughtfully by researching your target audience and developing ideas to address their biggest concerns. Also, take time to assess whether you have the energy and expertise to fulfill your target audience’s needs in the ways you’re considering. The last thing you want is to sell products or services you’re not too knowledgeable about and don’t have the energy to learn about or promote.
2. Seek financing or start slow
Getting money for your startup will likely be one of the first tasks on your list. To acquire the funds you need, you can take two common steps: getting a loan or finding investors. You can also use a more methodical approach by serving a smaller audience and then slowly growing your business to target a larger customer base.
3. Be resourceful
Not everything is necessary for you to have a successful startup. When starting your entrepreneurial journey, take time to assess what you really need to spend money on to move the needle. Anything that doesn’t fall into that category shouldn’t get your money.
Also, always be on the hunt for cost-effective alternatives. You never know when a more feasible option for what you’re using may appear, and you want to have the opportunity to reallocate your resources to stay on budget.
4. Approach hiring diligently
When hiring, there are a few things you need to do to have a successful outcome. First, develop a clear idea of what you’re looking for and create a job description that’s specific and detailed. That way, you attract the right candidates to the job.
Second, make sure to vet candidates properly. If necessary, have them do a skills assessment and a personality quiz. The results will give you insight into whether someone will truly be a good fit.
Finally, offer benefits that will help top talent choose you over working at another company. A good benefits package can go a long way in getting the best candidates to join your team.
5. Be flexible in your growth strategies
Growing your company will require you to do things differently. You might need to expand your product or service offerings, revamp your processes, or bring in a co-founder. The last idea is one that Noam Wasserman suggests in his book The Founder’s Dilemmas. Having co-founders with a sales background, technical expertise, and social connections can be just what you need to increase your brand’s success.
Swim, don’t sink
While running a business can be hard, it’s not impossible. You can overcome the top entrepreneurship challenges by approaching your business and its growth carefully and strategically. So don’t be one of the businesses that sink within the first year. Implement the above tips and other strategies experts recommend to ensure your business swims and stays afloat long-term.