10 Steps to Starting Your Side Hustle (part one)

Over the past few months friends and colleagues have increasingly sought my advice and considerations when thinking about starting a business. In this two-part series, I am going to share with you a simple list consisting of the ten pieces of advice that and a bonus “brief” business plan template that I wish I had when I took the leap into entrepreneurship.

I started Mod + Ethico in November 2015, and for years prior to launching, I had analysis paralysis. In business school I was building an enviable toolbox of know-how and skills to launch a business: studying strategy, market research, marketing, finance, courses specifically geared to launching products and services; yet I was still paralyzed with fear of jumping into unknown territory.

These steps provide a simplified roadmap, relevant to anyone, at any age and from any background looking to make a leap into starting their own business.

Ten steps to starting your own business (here’s the first five):

1. Always Be Ideating (ABI)

Always be ideating (ABI): this one is obvious, but find inspiration in your everyday life. Great ideas are all around you. Is your baby a Houdini with her mittens?! You wonder, “could there be a better product out there?” Adalynn (my now 18-month old) is a constant source of inspiration for product ideas. This does not mean I pursue each one, but as I see areas where her unique needs are not being met, a lightbulb goes off. I record all of these opportunities.

Keep a log of your personal frustrations and gaps in products and services in your own experiences. There is a good chance that if you have a frustrating experience, or have a need that’s not being met, others probably do to. Does that mean it should or could be a business idea? Not necessarily, but it’s a place to start. I keep a running log recording ideas I have. I find this ongoing brainstorming makes the ideation come easier. It’s a muscle that I constantly flex rather than carving out a specific time for ideation. For me, this practice is conducive to honing creative muscle memory.

monica_and_andy
Adalynn: My creative Muse, and mitten Houdini

2. Preliminary Research & the 5 Cs

Conduct Preliminary Research & use the 5 Cs: Customers, Competition, Company, Collaborators, Context. I find the 5 Cs, a long held marketing framework to be a useful method for conducting a preliminary research to help define and unpack an opportunity. Identify potential customers: who needs this? Create a customer archetype. Who is the competition? Think beyond an exact copy of your concept, where are customers meeting this need right now? Competition can be non-obvious alternative options. What does the company look like? What’s the business model? Collaborators: What resources do you need to bring this idea to market, and what’s the value exchange? Context (a.k.a. Climate or Conditions): why is the market primed for this idea now? What are trends?

3. The “Brief” Business Plan

Create a “Brief.” Create a short business plan. You may have heard, gone are the days of the 100-page plan. That’s true in some ways, especially for the entrepreneur who is scrappy and bootstrapping. You may need to build out a more detailed business plan if you intend to raise funding, but for starters, a “brief” to give you a framework will do the trick.

Download The “Brief” Business Plan Template

4. Generate initial financial projections

Create rough financial model. Get an idea for what this may cost you over the next 1-3 years, broken down by month. Input your monthly and/or annual costs. Create some very rough estimates based on costs for what you may need to bring in to offset those costs. What’s your estimated burn-rate? How much funding do you need, and how do you plan on financing? Boot-strapping (a.k.a, self-funding), friends and family, small business loan, venture capital, etc.

Directional, back of the envelope projections are fine for now. Refine later.

5. Assess how to proceed.

Evaluate – will you build, pivot, or abandon?. Based on your preliminary research and projections – challenge your business plan. Does it appear viable? If “yes,” let’s think MVP. If “yes, but” let’s consider a pivot, and revisit steps 1-4. If “no,” abandon. There is no shame in abandoning an idea. You are getting valuable practice in ideating, conducting research, and even if you are disappointed in the sunk cost of resources: your time, perhaps some financial investment. Just think of how much sanity and capital you saved by not sinking a major investment into what could have been a money pit for you.

Assess, make a decision to move forward, to pivot, and abandon your business idea.

Stay tuned for the next five steps to starting your side hustle in our next post.

Contributed by Candice Collison, founder of Mod + Ethico

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