6 challenges faced by young entrepreneurs

Some of the world’s most famous companies weren’t created in a boardroom by a committee of seasoned professionals. Here are a few businesses that you probably know which were started by entrepreneurs under the age of 35:

  • IKEA
  • Facebook
  • Apple Computer
  • Google
  • Mrs. Fields
  • Motown Records

What great things can young entrepreneurs do?

Young people possess optimism, endless energy, and fresh ideas. Because they’re not as set in their ways as older people can be, they’re often more willing to try new things, and can bounce back quickly from mistakes they may make. These qualities, coupled with their ability to quickly adapt to new technologies, make them natural leaders in the ever-developing small business climate.

What challenges can young entrepreneurs face?

Many young entrepreneurs don’t consider their youth a hindrance – they’re eagerly working on building their business and taking steps towards their dreams. We commend that passion, but the fact is that younger entrepreneurs do face some unique challenges in the world of small business, including:

  • Conflicts with high school, college, or university education
  • Lack of support from family
  • Reduced start-up capital
  • Lack of specific business skills
  • Less experience in leadership and management
  • Clients or suppliers who see the entrepreneur as a “kid,” and who may take advantage of youth or perceived inexperience

How can younger entrepreneurs overcome challenges?

At GoForth Institute, we believe strongly in the importance of small business education and supporting entrepreneurs of all ages. Knowledge is power! We advise younger entrepreneurs to seek out a trusted mentor, whether it’s in the field you want to enter, or just an experienced person who you trust to point you in the right direction.

We also strongly advise younger entrepreneurs to even the odds by knowing your business inside and out. Create a business model and vision statement, and be able to show clear leadership, organization and ownership of your business. To take it a step further, why not try answering the 6 common questions investors ask in a pitch? Even if you’re not seeking investment, they’re valuable, foundational things to know.

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Tips for getting started in social entrepreneurship

small business feedback

How can you make an impact in the world with social entrepreneurship?

It begins with understanding yourself and the social needs around you. People often wonder where to apply their energy. They want to know whether to become a social entrepreneur or just join an organization, or what issues to focus on. Finding the answers to these questions depends on personal considerations that are different for each person: What do you care deeply about? What situations bring out your natural gifts? Are you comfortable with uncertainty? Do you have a strong need for independence? 

Thanks to the many roles opening up in the field, there’s probably a role to fit your temperament. Fewer than 10% of Canadian workers are self-employed. Most people prefer to work in established structures, but that doesn’t mean they have to accept those structures as they are. Many promote change from within businesses and public institutions. 

How to get started in social entrepreneurship

Some thoughts on how to get started in social entrepreneurship, adapted from David Bornstein and Susan Davis’ Social Entrepreneurship: What You Need to Know. 

  1. Begin with an end in mind. 
  2. Do what you do best. 
  3. Have people ask you questions about your idea. 
  4. Practice pitching your idea. 
  5. Study the history of the problem you are attacking. 
  6. Develop a theory of change. 
  7. Keep thinking about how you can measure or evaluate success. 
  8. Celebrate every victory, no matter how small. 
  9. Initiate new relationships. 
  10. Apprentice yourself with masters (work without pay if necessary). 
  11. Volunteer for a political or social campaign. 
  12. Publish a letter to the editor or an opinion editorial (op-ed). 
  13. Meet with a newspaper editor and your local MLA/MPP/MNA/MHA. 
  14. Host dinner discussions about your idea. 
  15. Form a group to achieve a modest, short-term goal. 
  16. Ask a question at a public forum. 
  17. Engage people with opposing political views (respectfully, of course). 
  18. Ask for advice from people you admire. 
  19. Read biographies of people who have built things. 
  20. Spend some time working in a different sector, field or country. 
  21. Practice public speaking. 
  22. Take a finance course. 
  23. Learn how to negotiate. 
  24. Find sources of inspiration and use them. 
  25. Hold to principles, be flexible about methods. 
  26. Learn about trends in shifting mindsets. 

At GoForth, we’ve combined our love of entrepreneurship and our love of people to create several “close to the heart” social entrepreneurship projects. We’ve witnessed firsthand the power and joy of social change and raising others up. To us, social entrepreneurship is legacy work, making positive change in the lives of others.

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Pros and cons of sole proprietorship in Canada

sole proprietorship in canada

A sole proprietorship is the oldest, simplest and most common form of organization for a company.

It’s a business owned by one person — the sole proprietor — and is unincorporated. Easy as that!

Quick facts about sole proprietorship in Canada

  • As the business owner, you own all assets, earnings, and profits. However, you also hold all the responsibilities (including legal and debt), obligations and liabilities.
  • If you establish a business in your own name, without adding any other words, you don’t have to register the business. You can either bill customers in your name, or register a business name and bill customers under that name, which must have a separate bank account. The law doesn’t distinguish between the business and its owner, and personal income tax must be paid on all revenue generated by your business.
  • If your revenues are more than $30,000, or if you have legal ownership of more than one business, you must register for GST/HST (one registration will cover all businesses).

Let’s take a look at some of the pros and cons of this type of ownership.

Pros of sole proprietorship

  • Least expensive form of ownership, low start-up costs.
  • Most freedom from regulation.
  • Simple to start and dissolve.
  • Complete control over the company and decisions.
  • Least working capital required.
  • Complete control over the income generated by the business.
  • Complete access to profits.
  • Easier to offset losses against other income.
  • Flexibility.
  • Easiest to exit.

Cons of sole proprietorship

  • Business owner is legally responsible for all debts.
  • Unlimited liability (not separate by law; can be personally liable for all debts even if it means paying debts with your personal assets).
  • Business can’t continue in absence of owner.
  • Harder to raise funds from personal savings or loans.
  • Higher personal tax rate.
  • Often harder to find high quality employees.
  • Limited resources and opportunities for growth.
  • Some employee benefits are not deductible from business income.

Want to learn more about sole proprietorship? Check out GoForth’s online streaming small business training!

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How to find out if you’re ready to become an entrepreneur

am i an entrepreneur

Entrepreneurship is a great dream for many Canadians. And with the recent pandemic changing the world of work, many of us have been somewhat forced into starting a side business or freelancing to help make ends meet.

The reality of entrepreneurship is hard, and many Canadians aren’t ready for it – and that’s okay! You may be ready for it later on, after life circumstances change or small business training teaches you the necessary skills you don’t have yet.

How can you find out if you’re ready to be an entrepreneur?

Download GoForth’s free Self-Assessment for Entrepreneurs to see if now is a good time to start your small business journey. We can’t predict if you’ll be a success, but taking an honest look at your situation right now will help you figure out your odds. Take your time and do as much research and training as you can before you strike out on your own – it may make all the difference to your success.

Best of luck!

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Top 10 entrepreneurship myths

10 entrepreneurship myths

The world of entrepreneurship often seems very different to those who have been in it for a while, compared to those just starting out. Here are the top 10 entrepreneurship myths as told to us by Canadian entrepreneurs – what do you make of them?

Myth #1: Entrepreneurship is an extraordinary phenomenon – only a few will make it big

Contrary to what you see in your newsfeeds or read in the media, every one of us has the entrepreneurial potential to act. Successful entrepreneurship is not reserved for Richard Branson, Jeff Bezos, and Bill Gates. Every one has the ability to create a small business venture that solves problems and creates gains for their customers, and the world around them.

Myth #2: Start-up success depends more on the entrepreneur’s talent than on the business that they choose

Talent is great, but the kind of business you choose has a powerful effect on your chances of success. The odds that you will make the Inc. 500 list (the top 500 fastest growing private companies in America) are 840 times higher if you start a computer company than if you run a hotel. Overall industry health, and the degree to which the business is able to satisfy its target market’s pains, are just as important as your talent and experience.

Myth #3: Starting a business is easier than working for someone else

Yes, you can make your own rules and often set your own hours, but the job of a small business owner is no less demanding than that of an employee. Think about it — you’re often the only one to handle every aspect of your business. You’ll need to handle things you may not have experience in, like hiring and firing employees or making sales calls.

Myth #4: Entrepreneurship will make me rich!

The data suggests that getting rich is possible, but unlikely. In fact, seven years after starting a business, only one-third of owners have a company with positive cash flow greater than the salary they left behind. And remember, most start-ups – over 70% – don’t make it. Instead of focusing on the pie-in-the-sky dream of wealth, be realistic about the fact that you may operate at a loss before you begin to turn a profit – how much of that are you comfortable with?

Myth #5: The best time for new business start-ups is when you are young and energetic

There’s something to be said for life experience. Self-employment is growing fastest amongst young Canadians aged 15 to 24, and Canadians 55 years of age and older. These “Maturepreneurs” account for 25% of Canada’s self-employed workforce. Hey, Colonel Sanders started KFC at age 65 with his first social security cheque as start-up funds. There’s no time like the present!

Myth #6: Entrepreneurs are risk-takers

The image of entrepreneurs given in the media is exaggerated. Although giving up a steady paycheque may be a risky move, it may also be one of the few truly outlandish moves you will make in your career. Successful entrepreneurs only take what they believe to be carefully calculated and managed risks, often trying to influence the odds by getting others to share the risk with them or by avoiding the risk completely. Collaborating with others and building a team to take on the business opportunity means you’ll be spreading the profit around, but you’ll also be sharing the uncertainty and risk.

Myth #7: Entrepreneurs are completely independent as their own boss, leaving more time to do what they want

Contrary to popular belief, being an entrepreneur doesn’t mean you no longer have to answer to anyone. Although you may be the boss, you will have to answer to employees, customers, suppliers, investors and partners. You may also experience pressure from your community and there may be certain social obligations associated with your businesses. Don’t get caught up in daydreams of having more free time than ever before. In fact, 35% of self-employed people in Canada work over 50 hours per week compared with less than 40 hours per week for most employees. All the more reason to get the best small business training you can!

Myth #8: Entrepreneurs shouldn’t waste time writing a business plan if they’re not looking for funding

A business plan is an important step you can take in your business. This detailed road map of sorts forces you to think of things that will be important down the line. Every section of this plan, from analysis of the competition to understanding your target market, will give you confidence about how the business must be run to be successful. If you’re starting a small art gallery, knowledge of art is a great starting point. But consider the best marketing options; will you need to hire in three years? or will you need to expand in the future? Putting together your business plan on paper reveals things that you need to know, which will help you come up with solutions to potential problems ahead of time.

Myth #9: If I share my business ideas with anyone, they might steal them

Many believe that keeping ideas secret prevents another from stealing your business idea and starting the business themselves. The business idea is the cheapest part of a business – ideas are plentiful. If you share your ideas and resources with others to co-create a business opportunity, you gain access to their expertise, network of people, and resources.

Myth #10: Entrepreneurs instinctively know what their customers need and want

While we’d like to believe that entrepreneurs are oracles with the ability to see all and know all, that’s simply not true. Only your customers know what pains and problems they have a desire to solve. Engaging with customers, understanding them, testing your potential solutions with them, taking feedback, and testing again is a more direct path to success than creating and perfecting – a product or service first, only to find out your solution is off-track. A very costly mistake.

The reality of entrepreneurship can be difficult, involving lots of hard work and sacrifice. But fear not! Studies show that entrepreneurs with education in entrepreneurship and previous entrepreneurship experience have an 80–90% chance of success with a new business.

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