A growing number of people are choosing to set up their own businesses. This trend has taken many forms, with some opting to freelance as a “company of one” while others have founded startups with multiple employees and funding from venture capitalists.
What unifies many of these businesspeople, however, is passion. Their hobbies were the inspiration for their companies. And it was ultimately a desire to make a living from their passion that fuelled them.
If you are eager to turn your hobby into a business, now is an excellent time to get started. More than ever before, young entrepreneurs have access to funding, guidance and connected, accessible markets. In this post, we’re going to look at five practical steps for turning your passion into a thriving company.
1. Define Your Market
Before you do anything else, it’s vital to determine the feasibility of your new business idea. Whether you are thinking about selling a physical product, offering independent services, opening brick-and-mortar premises or anything else, you need to be sure that there is a market for what you intend to sell.
Many enthusiastic entrepreneurs dive head-first into the execution stage of their plan, only to discover there isn’t a market for what they are offering.
Hobbies don’t always have a market. This is the single most crucial thing for would-be entrepreneurs to understand. Don’t fall into the trap of being led exclusively by your passion; make sure you begin the process of setting up your new business with thorough research.
2. Start off Small With an MVP (Minimum Viable Product) or Side Project
Once you have established that there is a need for your intended product or service, it’s time to test the market more thoroughly. This should be done by launching a minimum viable product (MVP) or by starting your business as a side project.
A minimum viable product is a pared-down version of what you intend for your final product. It’s a prototype of sorts. By offering an MVP, you can gauge demand, gather feedback for further improvement, and begin to envision what kind of infrastructure you will need to scale operations.
Alternatively, if your business is service-based, you may wish to launch it as aside project. This is a great option for entrepreneurs with limited time and an existing job. Launching a side project will enable you to measure the market response to your services and build a new -income stream which can eventually replace your current career with minimum risk.
3. Identify Top-Performing Communication Channels
After launching your MVP or side project, you will start to get a sense of which channels are likely to drive significant numbers of leads to your business going forward.
In the early stages, it is important to experiment with multiple promotional methods, including social media, paid ads, traditional offline advertising, inbound marketing and so on. The idea here isn’t to do everything. Instead, you are looking to identify your “traction channels”. These are the lead-generation strategies that will allow you to cost-effectively generate the largest possible number of customers over the shortest period of time.
Once you have pinpointed the most effective channels for your business, you can focus your time and resources on leveraging them fully and drive down costs even further. This step is crucial because it allows you to establish secure income streams and will form the basis of your broader business strategy as you look towards expansion and growth.
4. Clarify Your Business Model and Ambitions
Once you have tested the market, refined your product or service so that it best meets your potential customers’ needs, and identified promising and financially sustainable promotional channels, your next step is to implement a more developed business plan.
In this stage, it is essential to clarify your ambitions and think about which business models best fit with your goals. Suppose you want to run a one-person consulting business that is geared around your professional services, for example. In that case, you will require a different approach from somebody who wants to build an international brand selling physical products.
Getting clear about the vision for your company will enable you to make the right strategic decisions. Remember, if you wish to continue undertaking tasks directly related to your hobby, rather than taking om a higher-level managerial or leadership role, you will need to place greater emphasis on building a personal brand as opposed to growing a team and company.
5. Acquire Capital to Grow Your Business
Once you have a promising company centred around your hobby, along with access to a proven market, you may wish to expand. To reach new customers and develop your product range, you will need investment. Fortunately, there are numerous financing opportunities for young entrepreneurs, each with different degrees of risk. Venture capitalists, business loans, incubators and funding from family members are all viable options that are worth considering.
Importantly, financing will enable you to start building your team, whether that is through outsourcing or direct hiring. Depending on the model you have chosen for your business, this step could give you the freedom you need to move more fully into your role as CEO and focus on the broader vision and direction of your startup, rather than on the day-to-day.
Develop Your Skills and Expertise at EU Business School
If you are excited by the prospect of turning your passion into a successful business, EU Business School can provide you with all the skills and experience you need. You’ll get the chance to learn from leading business professionals, many of whom have direct experience of entrepreneurship.
We offer a range of tailored programs for individuals who want to grow their own company. These include the Master in Innovation and Entrepreneurship and the MBA in Entrepreneurship. What’s more, our campuses are located in some of the world’s most prominent business hubs, all of which have thriving startup scenes.