From camping to blending tea, viable businesses are often born from hobbies. If you've been considering turning your passion into a paycheck, completing a series of steps and acquiring a variety of skills can put you on the path to success.
Here are 10 tips to get you started.
1. Do a gut check
A hobby is something you do for enjoyment when you're not at work. When you make it your livelihood, however, you have to be willing to put in the time it takes to launch a business, please customers, and meet deadlines.
To be committed, you should have a passion for what you do.
"Doing what you love makes the project not feel like work," says Jen Henson, founder of Goal Digger ACT-Prep. "Pour into the people who would benefit from your hobby and strive to make their lives better. That is the success of my business."
2. Test the concept
It can help to start your business as a side hustle to test it out first. When the profits start to reach a level close to your current income, it may be time to quit your day job.
"Make sure you have enough cash flow to last you at least two years," suggests Ashley Lim, founder of Mansa Tea. "It's emotionally and financially hard to go from being a salaried employee to an entrepreneur. To avoid worrying about rent or food on the table, I made sure to save up at least two years of living expenses to get through these early years."
3. Write a business plan
A business plan is a blueprint for a business, and it's often required to get a business loan. But don't skip this step even if you're not seeking funding.
According to a report published in the Strategic Entrepreneurship Journal, entrepreneurs who write a formal plan are 16% more likely to achieve viability than those who do not.
Yours should include:
- An executive summary
- Company overview
- List of products and services
- Market strategies
- Sales and marketing plan
- Milestones and metrics
- Management team
- Financial plan
"If you are doing something to make a profit, then it's a business," says Dale Buchanan, owner of Top Gun Dog Training, an obedience and behavior training service. "Take it seriously and write a business plan."
4. Build your brand
Branding is important when it comes to recognition. You'll need a business name and logo that will convey your business personality and look good on a website, business card, and advertisement. Choose colors that resonate best with your target market.
Buchanan created his own branding. "I chose the company name, made the logo myself using LogoGenie online, and picked the colors," he says. "I think most people can do this themselves, but might need a little guidance."
5. Perfect your elevator pitch
Every time you meet someone new, share your business mission in 30 seconds or less. Henson tells people, "I help students get into college. The typical student needs help conquering the ACT test, and I know what to teach them. I've had students raise their score by as many as 14 points composite. Do you know anyone who might need my help?"
6. Create a web presence
Eighty-seven percent of consumers start a purchase online, according to research from Salesforce and Publicis Sapient. If you're not online, you don't exist.
Create a website and social media pages. And add your business to Google My Business. Having a web presence and the right tools in place can help you expand your target market.
"With technology such as Skype and Zoom, I tutor students all across the country," Henson says.
7. Develop a marketing strategy
Your products and services are amazing, and you need to tell the world. Marketing doesn't have to be expensive. Start with free social media accounts. Volunteer at community events to spread the word locally. And as you get more sales, try paid marketing opportunities, like social media ads.
"Plan on social media and marketing taking more time than you think," says Amy Lokken, owner of A Craft Party, which offers craft kits parents can do with their children. "But it is important and worth the time and effort to get in front of your desired audience. Leverage resources available to you to either learn how to do it effectively, or make a decision to outsource."
8. Find your customers
Seek out your target market. "Put a lot of thought into the groups and places your target audience might be in," suggests Lokken. "For me, it's all the mom groups. Think creatively on how you can partner with those places and bring value to the business and your desired customer," she adds.
9. Watch your finances
Turning your hobby into a business means reporting your income and paying taxes. Set up a business bank account. Hire an accountant or get accounting software that can help you keep track of your finances. You may have to curb your spending to have enough money to flow into your business.
"I put a full stop to my retail therapy habits to make sure I put an end to any unnecessary cash outflow," says Lim.
10. Get a mentor
Having a mentor who can offer advice from personal experience is valuable.
"The passion and drive you have for your hobby are not sufficient enough to run a successful business," says Dan Nolan, founder of Camping Console, a camping gear review site. "Learn from the people who already went through the nitty-gritty of starting their own business. These people can provide you things to avoid and improve for you to be successful."
When you invest time and energy necessary to complete these steps, you give your business a better chance of success. Launching a company and watching it grow can be a rewarding job that you create for yourself.
Find out more about Starting a Business