Advice to Younger Entrepreneurs

We are very passionate about entrepreneurism at Kona Impact. It is wonderfully exciting to speak with people about their business ideas and goals, especially younger entrepreneurs who may not have significant business experience yet are full of energy, enthusiasm, and ideas.

Young Entrepreneurs Have Advantages

New, young entrepreneurs have a lot going for them. They…

  • understand the youth markets
  • tend to have boundless energy and enthusiasm
  • usually have a good command of social media
  • tend to be highly optimistic

What new entrepreneurs tend to lack:

  • business experience
  • financial resources—money
  • a perspective on future clients or customers that are older

One thing that younger business people need to develop is perseverance or grit. Some have it; some need to learn it. Without that, any business is bound to fail.

Some Age-Old Wisdom for Young Entrepreneurs

Here’s my top five list of things a younger businessperson should focus on in the early stages of any new business:

  1. Run the numbers. We tried to see what it’d take for a small cake shop to make it. After considering rent for a commercial kitchen space, supplies, marketing, taxes, and a very basic payroll, we figured out that a small custom cake shop would need to sell 20-30 cakes a day just to break even. That’s a nearly impossible task in Kona, which is why you don’t see any (that I know of) independent cake shops. The point is that running the numbers needs to be the first step. If you can’t make decent money, you need to change your business plan or move on to the next idea.
  2. Find a mentor. This is true for nearly all entrepreneurs, but it is especially true for people just starting. You need a confidant with who you can share ideas and get honest, no holds barred feedback. Most business owners I know would be willing to spend an hour a week with any serious person starting a business.
  3. Get in front of your customers quickly. They will help you refine and tune your offerings. Don’t spend weeks on a logo or business cards; get those done quickly and then start pitching your customers. They will tell you quickly what is viable and what is a waste of your time. Doing will get you further than thinking about doing.
  4. Set up your finances correctly. Though we all hate spending money on our bookkeeping and accountants, these will help you have a solid legal foundation for your business. They are also great advisors and can save you lots of money down the road and keep your business compliant with all the necessary filings.
  5. Only buy things—at least initially—that will make you money. That $1000 desk, a fancy new truck, and a Mont Blanc pen can wait until you get your footing. Tools, equipment, inventory, marketing services, a website, direct mail campaign, and so on are what will propel you to profitability. After 15 successful years in business, I still have the $225 desk I bought when I started, my truck is very basic, but I did finally splurge on a Mont Blanc. It’s easy to look at finer things as a reward for success—and they are—but be sure you have all your needs met before you add a lot of unnecessary wants.

Running a business is hard on a good day and can be miserable on bad days. That said, entrepreneurialism is an iterative process—two steps forward, one step back. I like to say that if it were easy, we’d all be on our yachts today, but it isn’t, so building a good foundation and making incremental progress will get you further faster.