If your dream is to start your own business, you’re just like many people, but it’s hard to tell when the “right” time is. Running a business can be an incredible experience full of adventure — not to mention an experience with lucrative returns should everything go as well as you plan.
But how do you know that you are ready to take a leap of faith and start your own venture? We’ve outlined a few signs it might be time for you to just go for it.
14 signs it’s time to start your own business
These aren’t hard-and-fast rules — plenty of people have broken them before. But if you say yes to most of this list, chances are you’re in good shape to step out into the wild and crazy world of entrepreneurship.
- You’re excited about your idea.
- You have a business plan.
- Your product or idea has a market.
- You understand the competition.
- You are able to take on financial risk.
- You look good to lenders.
- You understand the risk of failure.
- You understand the risk of success.
- You’re ready to roll up your sleeves.
- You’re ready to learn.
- You are capable of managing your own time.
- You are able to see potential.
- You want to be your own boss.
- You’re good with people.
Ready? Let’s go!
1. You’re excited about your idea
Of course, passion alone will not get the job done, but if you’re aren’t passionate about your business idea, you’ll be running on fumes before you know it.
Many things in small business ownership are “fake it ‘til you make it,” but this is not one of them.
2. You have a business plan
You’ve done the work. You’ve outlined just how you’ll run this thing. You know the numbers.
If you’ve yet to execute this all-important task, it might be time to pump the breaks on the idea you’re excited about until you can see what the big picture is.
3. Your product or idea has a market
You’ll figure this out as part of your business plan, but knowing there’s a demand you can supply is a sure-fire way to know that now may be the right time to start your own business.
Just make sure you’ve done your research and consulted with people who are knowledgeable about the product or service on the supply side.
4. You understand the competition
You’ve always wanted to own a coffee shop, the problem is, there are already three in your neighborhood.
Once you start your own business, how will it stand out? What do you have to offer that your competitors don’t?
This will be important to factor into your business plan.
5. You are able to take on financial risk
Plenty of business owners come from modest means. But it’s much easier to focus on your business if you have some money saved to live off until you get the business off the ground.
6. You look good to lenders
A big part of running a business long-term is the ability to secure financing when you need.
How is your credit score? Have you taken on too much personal debt?
Consult with a small business finance advisor to see what you can do to make sure you look good on paper.
Related: How to get a small business loan
7. You understand the risk of failure
It’s not as doom-and-gloom as you might think for small businesses today. In fact, 80 percent of businesses will make it through their first year, and about 50 percent make it to their fifth year.
But it’s still a pretty huge drop-off. Only around 30 percent of businesses make it to their tenth year.
Risk of failure should never stop someone with a good idea and solid business plan from pursuing their dream.
8. You understand the risk of success
What will your life look like should your business really take off? It might seem strange, but many people don’t consider this. If business is booming, but you never have time to see your family, are you truly living the life you want to live?
Be honest with yourself about what your boundaries are and set expectations with your business partners and loved ones before you start your own business.
9. You’re ready to roll up your sleeves
Starting a business might mean doing things that feel “beneath your pay grade.” You’re the CEO/Founder/Boss-person, anyway, right?
If this doesn’t sound fun to you, starting a business from scratch might not be the right route.
10. You’re ready to learn
Oh, the knowledge you’ll gain through the process of starting a business.
No matter how many degrees you have or years of work experience you’ve put in, challenges will always arise when starting a business.
If you love the idea of learning something new every day, entrepreneurship is probably a good fit for you.
11. You are capable of managing your own time
Managing a business often comes down to a numbers game — the more time you have the better. You’ll be working under pressure no matter what, but stellar time management will make the process go much, much smoother.
12. You are able to see potential
Are you one of those people who believes in the underdog? Who can spot a success story before it breaks big? This will be an essential skill in running a business. You’ll need to be able to see the big picture when you’re sales have hit their goals yet or it feels like you’ll never break even.
13. You want to be your own boss
If you want to forge your own path, entrepreneurship is definitely a fit for you. If you have the ability to give yourself a daily structure and fly by the seat of your pants, it’ll suit you well to start your own business.
14. But … you’re good with people
Being your own boss does not mean you don’t have to be a people person. Managing a business is a social sport — you’ll have to work with your employees, vendors, clients, customers and more.
It’s likely you’ll be the face of your own business. Is this the kind of attention you want?