Aside from managing the pressures of running your own business, young entrepreneurs can be subjected to certain social attitudes and stereotypes that make it even more difficult to be successful and obtain a secure position in the business world.
This could be considered the best and easiest moment in history to become an entrepreneur with the help of the internet and social media. However, with that comes increased competition and an even tougher challenge to be noticed in the crowd.
Here are 7 biggest challenges young entrepreneurs face as well as some expert tips on how to overcome these hurdles:
1. Being impatient
We live in a time where we’ve all come to expect a degree of instantaneousness in our lives which is reflected in the business world. Investors and business owners want quick results because that’s where profit and growth lie.
The problem young entrepreneurs are faced with when designing business plans for start ups is that they need to be able to take into account and forecast growth to a relatively accurate degree, which as any successful businessman will tell you is of course is never easy.
A significant amount of time is needed to establish a business from the ground-up – a minimum of five years would be ideal as this gives you the opportunity to lay a sufficient foundation to not only ensure your business is successful and raises capital, but that it is also a sustainable enterprise.
2. Believing that all you need is money
There is a common misconception among young entrepreneurs that starting a business initially requires a large sum of money. What is not often understood is that ideas themselves are also valuable, and it’s these great ideas that get implemented and eventually result in profits. While obviously money is needed for a start-up, it’s the exceptional idea that really gives it its worth, and the time you invest to develop it.
3. Going big too soon
Often the smartest way to go about setting up a business venture is to start small. Young entrepreneurs may find this frustrating and want to jump in headfirst. However, from my experience, although depending on the business, allowing the business to develop at a natural pace, rather than forcing growth, is far better in the long run. By having this mentality you may be surprised by how quickly the business organically develops.
4. Raising capital
Although you often need fewer finances than you would think, one of the biggest challenges for young entrepreneurs is raising capital. It’s common for these entrepreneurs not to have a solid credit history or any valuable assets to use for security. In this case, partnering up with people and combining finances will help, as well as implementing ideas like shareholding. This is also where starting small really makes a difference. If you have a plan that is too unrealistic and you can’t secure enough capital, it will most likely end up falling flat.
Having a strong business plan will enable you to approach banks and lenders with a higher chance of being approved for loans. It’s also important to be constantly seeking new ways of raising capital and to always have a ‘Plan B’.
5. Having an unwillingness to learn
Many of today’s young entrepreneurs aren’t open to learning and expanding their minds, and as a result, they are closing themselves off from invaluable information and advice that can help them become successful. Conducting research on industry trends, attending seminars, and talking to industry professionals is the best way to understand what the current and past challenges are in business, and how people overcome these problems.
It is here where mentoring becomes key; finding the right mentor will help overcome any barriers that a person has to learn. Having a mentor opens doors to new methods, skills, and opportunities, by learning from others who have succeeded before them.
6. Fearing debt
For a young entrepreneur, the thought of having substantial debt, whether with the bank or an alternative lender, can be quite daunting. There is also a negative stigma around borrowing money which I believe to be completely false. If you have a strong business idea and a solid business plan to make it successful and profitable, borrowing money is perfectly acceptable.
7. Not perfecting your communication skills
When you are running a business, your communication skills are undoubtedly tied to the success of the business, particularly if you become the face of the business. If this is the case, knowing how to speak with confidence is an absolute must. As a representative of the business, you’ll be constantly communicating with people, whether it be selling, negotiating or networking, so your people skills need to be of a high standard. If you don’t naturally possess these abilities, complete a sales, network marketing or public speaking course to build your confidence and skills, so your business become more profitable.
About the author:
Zaki Ameer is the Founder of Dream Design Property (DDP), a unique wealth creation mentoring program that is designed to help Australians gain financial freedom, offering each client an ongoing personalised service catering to their changing circumstances and needs. DDP has helped its clients purchase nearly 800 properties and has recently launched Dream Design Property Developments, offering clients the safest and most cost effective way to purchase off the plan properties.