Blog | Entrepreneurship

5 Things Every Woman Should Know About Starting A Business

Do you have what it takes to make the leap to entrepreneurship?

Believe it or not, now is the prefect time for women to start a business. Why? You know I just love numbers, so let’s start with the facts. There are 30.2 million small businesses in the United States. Small businesses are literally the backbone of America, employing 58.9 million people (nearly 50% of the country’s workforce).

Startup activity in the U.S. is rising after being at its lowest point in 20 years, with the rate of new entrepreneurs increasing by 15% over the past two years, according to the Kauffman Index of Startup Activity. That equals roughly 550,000 new business owners each month.

Now, as you might have guessed, women are a large factor in this equation. As of 2015, 33.02% of small businesses are owned by women — yes, one-third. Of course, I won’t be happy until that number is closer to one-half (or more, let’s be honest), but it’s still encouraging, nonetheless.

What’s more, according to the National Association of Women Business Owners (NAWBO), one in five firms with revenue of $1 million or more is woman-owned and 4.2% of all women-owned firms have revenues of 1 million or more. So, these women are making money!

Whether you’re sick of the soul-sucking rat race that is Corporate America, you have an exciting product or service to offer that could disrupt the marketplace, you’re re-entering the workforce after raising a family, or you’ve been told a hundred times that you would make a great entrepreneur, there’s just no reason to settle for a job you hate and an uncertain financial future in this day and age.

The hardest step is always the first, because the perfect recipe for starting a new business is not something you can learn by reading books, getting a brain dump for a mentor, or creating a solid business plan (though these things are all valuable, so I certainly encourage you to do them). Women starting a business often come to me for advice, so while you’ll learn the most by doing (and making mistakes), let me offer a few pointers to prevent a few of the most common pitfalls you’re likely to experience:

Establish your support system.

Even if you’re starting off solo, you should never be working in a silo when it comes to running a business. At the very least, you’ll need an accountant or financial advisor, an attorney, a mentor to bounce ideas off, and family and friends who believe in and support you. Ask successful people you know for mentor recommendations, or join a women’s business association such as the NAWBO or the American Business Women’s Association (ABWA) for professional support and resources. Be sure to also check out this list of 8 online resources for women supporting women.

1. Follow your passion.

   They say if you do what you love, you’ll never work a day in your life. It’s crucial that your business venture be something you are passionate about, because you’re going to be spending most of your waking hours doing it. Entrepreneurship isn’t like clocking into a job or even working a few extra hours here and there at a salaried role. It’s something that you’ll be living and breathing and probably obsessing over when you can’t sleep late at night, so it should be something that you are just crazy about. Don’t miss my recent post about how to turn your part-time passion into a profitable business, as this would probably be most people’s dream scenario. Plus, when you’re passionate about something, your enthusiasm is contagious — and that’s how you’ll excel at things like sales, negotiations, securing funding/partners, etc.

2. Be one with your brand.

   Your brand says everything about you and your company, so it should be clearly defined and then consistently applied across everything you do. Your brand not only encompasses your logo, messaging, fonts and color palette, but also your mission statement, values, quality and approach to customer service. Brand consistency will serve to build trust with your customers (and potential ones), establish credibility, and differentiate you from your competitors. For instance, my brand is centered around providing a positive learning environment for financial education to women — and that’s at the core of all my endeavors. If your brand is about baking and selling amazing cookies, then don’t ever show up to a friend’s dinner party carrying store-bought sweets. Make your own! Likewise, don’t post all over social media about how you’re giving up sweets to lose some weight, or everyone will equate your brand/product with a negative thought, like gaining weight. Use every opportunity you can to promote your brand in a positive and authentic way.

3. Get over your fear.

   For women starting a business, this can be the most difficult obstacle to overcome. I get it: Making a big change in your life and the way you earn money is scary and risky. What if it doesn’t pay off? In the book “You Are a Badass: How to Stop Doubting Your Greatness and Start Living an Awesome Life” author Jen Sincero urges her readers to “feed fear a suck-it sandwich.” Are you scared of rejection? It’s bound to happen … dust yourself off, make necessary adjustments, and try again. Are you afraid of failure? You’re going to have some failures along the way — in fact, it’s normal to fail. It’s how you rebound that really matters when it comes to failure. Oftentimes, we get so wrapped up in imagining the worst possible consequence and convincing ourselves that the worst will happen, but the reality is that the worst-case scenario very rarely plays out. If you’re still letting fear get the best of you, check out my tried-and-true tips for overcoming fear so that you can chase your dreams!

4. Never underestimate your value.

   Just because you don’t have decades of experience, a college degree, or a network of high-worth individuals in your portfolio doesn’t mean you have no business starting a business and charging what you deem is fair market value. There’s a very real pay gap when it comes to gender, and when you’re starting out it can be tempting to adopt an “I’m lucky to get this much” mentality. But here’s the deal: Men don’t do that! For instance, men ask for far more money when seeking funding. According to a study conducted by Fundera, female entrepreneurs ask for an average of $89,000 to fund their businesses, while male entrepreneurs ask for an average of $124,500). Why aren’t we asking for more? Know what your product or service is worth and charge accordingly. Don’t be afraid to negotiate — best case scenario, you’ll get the respect and the money you deserve. Worst case scenario, you won’t get the client or sale, and you’ll try again tomorrow. Now, I’m not saying there isn’t a time and a place to accept a bit less to get your foot in the door or get your business off the ground, but it’s not something you should make a habit of out of fear of not being able to do better. The best part about women starting a business is that it puts them in the driver’s seat — you become in control of your own financial future.

Are you read to start your business?

Now that you know what it takes to be a successful business owner, it all comes down to timing.

If you've been sitting on a great business idea, or harboring a desire to become an entrepreneur, it might be time to finally put your plans into action. Before you do, ask yourself these five questions to determine if you're ready to take that big leap.

1. Why do I want to start this business?

   Why are you starting this business specifically? What about it appeals to you? Maybe you know a lot about the market and see a gap that your business could fill. Or maybe you believe your business could do some real good and enact positive change in the community. Maybe you're really passionate about the industry. Whatever your reason, it has to be strong enough to sustain you. Becoming an entrepreneur is a rocky road, so make sure you are clear on why you believe in your business. Another way to think about this concept is to “define your why.”

2. Do my business goals align with my personal goals?

   When your business goals get in the way of your personal goals, it leads to enormous sacrifices on both sides. One of the best parts of starting your own business, however, is that you get to make it your own. You are in control. Maybe your goal is to travel the world. Or spend more time with your family. Or become financially independent. Whatever your personal goals are, make sure the business you create allows you to achieve them.

3. Do I believe in myself?

   The life of an entrepreneur is hard. You will face many trials and setbacks along the way. You'll make mistakes, and you'll face doubt from negative naysayers. These things won't matter, however, as long as you believe in yourself. At times when it seems everything is against you, only confidence in your spirit and your abilities will see you through.

4. Am I prepared for risk?

   Leaving a stable, secure job to start your own business comes with some risks. Take this time to consider what you are and are not willing to risk (start with this analysis of risk management for 2021). Are you comfortable with the idea of giving up a steady paycheck to strike out on your own? Are you okay investing in your business with your own personal capital? If not, are you willing to ask others for money and help? Be completely honest with yourself. When you understand your risk level comfort, your path forward will be clearer.

5. What further education do I need to succeed?

   It's impossible to know everything you need to know when starting your business. Becoming a business owner is one giant learning process. I've been an entrepreneur for years and I still learn new things every day. That said, you should be aware of the holes in your financial education as you start your business. Once you identify what education you're missing, you can create a strategy to learn what you need to. Maybe you need to learn hiring techniques, or how set up an online store to sell your product on Amazon. Whatever it is, make sure you create time to fill these gaps in your education. Might I suggest starting with Rich Dad’s free investing classes that will help you learn more about personal finance, real estate and stocks? Or pick up a copy of my book It’s Rising Time: What It Really Takes to Reach Your Financial Dreams.

What are you waiting for?

Remember that there's never a perfect time to start a business. Many people sit around for years waiting for that perfect moment to take the next step, but it never comes. There's always some excuse to not get started.

Sometimes, you just have to take the plunge. If you want to be your own boss, to start your own business and embrace the life of an entrepreneur, it's up to you to get yourself there. Good luck!