It may surprise you to learn that, despite the COVID-19 pandemic, Americans are starting new businesses at the fastest rate in over a decade.
If your first instinct amidst the pandemic wasn’t to open a new business, you wouldn’t be alone. Many people have been weighed down by financial burdens and health concerns over the last year. However, despite all of the question marks currently floating around about the state of the world, if you’ve always wanted to open a business, now is not necessarily the time to rule it out. While the future remains unpredictable, (vaccines? fourth waves? new strains of virus?), we are living in a once-in-a-lifetime situation created after global and nationwide shutdowns reshaped the economy.
Here are some tips and things to consider for anyone thinking of starting a business during the pandemic.
Be real with yourself
Why are you starting your business? Is it because you are passionate about something? Are you filling a need or a hole in the market? Are you trying to make a difference in your community? Perhaps you’re following a lifelong dream?
It’s crucial to be honest with yourself, your ideas, and your expectations so that you’re not setting yourself up for unrealistic expectations. As the pandemic shut down the country, many businesses were forced to close, which has created many gaps in the market, but the truth remains that the majority of businesses don’t make it past the five year mark. Owning a small business takes dedication, energy, money, patience, and constant attention. You should feel confident that you’re prepared to give it all you’ve got.
Consider your finances
How do you plan to fund your business? Most entrepreneurs start a business with a very limited amount of money, which can put a serious strain on you as an entrepreneur. Do you plan to borrow money from friends and family? Do you have investors lined up? Also consider small business loans and government funding.
While you might find yourself wanting to dive right in and focus your full attention on your new business, it’s usually best to start slowly. If you have a job, consider going down to part time and starting your new business as a side venture. If your eggs aren’t all in one basket, you’re at less of a financial risk.
One of the most costly expenses of running a business is hiring help. Luckily, there are many quality freelancers out there, and odds are, thanks to the pandemic and current high unemployment rates, they are looking for work. Utilizing freelance workers eliminates many of the costs employers typically have to pay.
After all of the suffering and misfortune that the last year has brought most of us, people are especially keen to give back, support one another, and make a positive difference. Consider donating a percentage of all profits to a local food bank or sponsoring a day care program for children of frontline workers. When you give, you almost always get.
At The Humphreys Group, clients come to us because they aspire to something greater, and we welcome these challenges with a deep commitment to providing you with a comfortable, collaborative setting to explore your concerns and follow your dreams. Our planning process has a single purpose: to manage your wealth so that you may live fully and confidently.
If you’re considering starting a new business and want a second opinion, consider reaching out! We are devoted to seeing you thrive, both financially and personally.