"Most people are sitting on their own diamond mines. The surest ways to lose your diamond mine are to get bored, become overambitious, or start thinking that the grass is greener on the other side." ― Gino Wickman, 'Traction: Get a Grip on Your Business'
Perhaps you have often considered starting your own business but realized each time that the idea seemed easier in theory than practice. It is not clear where to start or where to get funding. Then, there's the question of whether the home business should be a side hustle or scale it into a successful business and a full-time job.
The good news! A home business lets you step into entrepreneurship without the hefty startup costs. And with the right approach, you can start right away. This article shares actionable insights from 'Profit First,' 'Crushing It,' and 'Traction,' —books that break down the strategies you need to build a profitable business from home.
How to turn your home business ideas into a viable business
"If you’re not 100 percent happy with your life today, it is never a waste of time to try something that could get you there." ― Gary Vaynerchuk, 'Crushing It!'
You have the entrepreneurial spirit, the drive to make money, and the willingness to take risks—that’s a great start!
Initially, you might find yourself juggling multiple roles—manager, courier, consultant—and even using your balcony for storage.
But every successful business starts somewhere, and the potential for growth makes it all worthwhile.
Just think—Amazon began as a small venture, too!
Now, it’s time to turn your idea into reality. Start by identifying the type of business you want to build. Conduct market research, define your target audience, and lay the foundation for your future success.
1. Conduct market research to determine the current demand of consumers
"Profit isn’t even something that waits until tomorrow. Profit must happen now and always. Profit must be baked into your business." ― Mike Michalowicz, 'Profit First'
Entrepreneurs use one of two ways to find a new business idea: following the heart or applying analytics. In the first case, they base their new business on the activities they enjoy; in the second, they consider what is in demand in the market.
However, business coach Gary Vaynerchuk suggests trying a slightly different approach using such steps:
Analyze your current expertise (your achievements and cases should support your new business choice). Are you good at selling, cooking, writing advertising texts, or teaching others?
Assess the demand for your expertise and understand the market situation. Do people (or companies) have any needs they must satisfy?
Determine if you can do something better, faster, cheaper, and brighter than everyone already doing it.
Learn why potential buyers would pay you for this work or service.
2. Consider asking yourself the following questions to understand your target audience better.
Will my future business address some problems for my target audience? If so, what specific issues will it solve?
Is the market oversaturated with businesses that offer similar products or services?
Do I understand how to make a wow product that will become the best on the market?
Does my business idea inspire everyone on my team, and does everyone understand why it should be implemented?
Does my business idea violate the law? Does it pose a danger to others? Can it be implemented in my country?
If most of your answers are positive, it is worth giving your new business venture a go. However, your idea must be refined, rethought, or shifted to other target audience segments or markets if your answers are negative.
"You don’t get to call yourself an expert until you’ve put in the work—and the market decides, not you." ― Gary Vaynerchuk, 'Crushing It!'
Don’t have home business ideas? Here’s where to begin.
"Clarify your vision and you will make better decisions about people, processes, finances, strategies, and customers." ― Gino Wickman, 'Traction'
It is not necessary to try to find a new niche. Instead, focus on finding new ways to produce or sell something — an unusual business concept in a familiar niche. You can also improve processes that potential competitors have problems with (for example, speed up something, increase the level of customer orientation, or create a convenient and attractive website).
Digital outsourcing
It includes services related to web development, internet marketing and advertising, freelance writing, website creation, graphic design, and SEO promotion. Relevant experience and qualifications are the main requirements for employment here, making it unsuitable for everyone. However, such a small business at home is actively developing since there is no geographical barrier to attracting customers.
Handmade products
If you enjoy handmade products, there are many ways to earn money from them. You can sell your products at local markets, classified sites like etsy.com, and unique thematic online platforms, or even create an e-commerce website dedicated to this business. The best approach is to experiment with all the listed areas and effectively combine them.
Operating a home business often means producing small batches of physical goods (sewing children's clothes, baking cakes) or service-based business (massage, hairstyles, childcare at home). Among the perks is that you save on renting an office, warehouse, or other premises and are close to your family (this is important if you have a small child).
Real estate agent
You can earn enough money from two or three transactions to live in abundance for the next six months when selling apartments and commercial real estate. You can start by agreeing to work for a percentage with an already existing agency. Then, think about how to develop your customer database.
Online store
Running an online business means selling goods or providing services online. It can be selling things via Instagram or an online store or creating a team of freelancers. Sometimes, you don’t need to buy the product — dropshipping is here to help. Among the advantages is the opportunity to work in international markets because the Internet has no boundaries.
Blogging
Your thoughts and knowledge can earn you money through a blog. Creating and sharing your unique content on social media, personal websites, or specialized platforms is exciting! Bloggers explore diverse formats, such as text, YouTube videos, podcasts, and even engaging posts on Instagram and TikTok. If you have valuable information for readers and can sell it, you can monetize the blog through paid advertising, affiliate marketing, sponsored content, selling digital products, and premium access.
"If you cannot risk, you cannot grow. If you cannot grow, you cannot become your best. If you cannot become your best, you cannot be happy. If you cannot be happy, what else matters?" ― Gino Wickman, 'Traction'
Three steps to forming a solid business plan
A business plan is a map depicting how your idea will become profitable. It shows the steps you will take and how long you expect it to take to pay off the initial investment. Your business plan will help you consider whether your venture will be worthwhile, the resources required to start, those necessary throughout the year, and whether scaling in the future is feasible.
Why do you need a business plan? To minimize risks and not invest money in a project that does not pay off even at the planning stage.
A typical structure of a business plan
"An entrepreneur is someone who finds the solutions to opportunities and problems and then builds systems to consistently deliver those solutions through other people or things." ― Mike Michalowicz, 'Profit First'
Project Summary: This section provides a brief description of the business idea, highlighting its essence, key features, profitability level, and the necessary resources and investments required for success.
Market Analysis: This section discusses market trends and identifies the target market, focusing on the problem your business aims to solve.
Marketing Strategy: Understanding your potential customers is one of the crucial first steps to achieving business success. A thorough analysis should address the following questions.
Who are my potential customers?
What are their buying habits?
How big is my target market?
How much are customers willing to pay for my product?
Who are my main competitors?
What are my competitors’ strengths and weaknesses?
Not everyone will become a customer, and trying to interest everyone in your product or service would waste time. Instead, use target market analysis to decide who will likely want to buy your product or service and focus your efforts there.
You can create a business plan yourself or hire a specialist to help you make the required calculations.
Legal and financial tips to secure your business success
Start by choosing the right kind of business that suits your goals, then secure the business licenses to operate legally. Setting up your legal entity — an LLC, sole proprietorship, or corporation — will protect you and your business in the long run. Finally, ensure you have all the required paperwork, from tax registrations to business insurance, so you can focus on confidently growing your venture.
Choose a business structure
A sole proprietorship is one of the simplest business forms in the US. In this structure, the owner is responsible for managing the business and is fully liable for its debts, meaning personal assets are at risk. Additionally, a sole proprietorship is subject to self-employment tax and has minimal reporting requirements. However, the more common way to start a business in the United States is to form a Limited Liability Company (LLC). An LLC is a hybrid structure that combines the characteristics of a sole proprietorship and a corporation. It inherits a sole proprietorship's taxation approach and a corporation's limited liability features. Most states recognize LLCs as companies owned by a single owner.
An Operating Agreement is a crucial document for an LLC. It outlines the financial and operational details of running the business, management standards, and the allocation of liability among members. Depending on their state's requirements, each LLC must file reports with the Secretary of State’s office annually or biannually. Failure to meet this obligation could result in fines.
A sole proprietorship is one of the simplest business forms in the US. In this structure, the owner is responsible for managing the business and is fully liable for its debts, meaning personal assets are at risk. Additionally, a sole proprietorship is subject to self-employment tax and has minimal reporting requirements.
Step-by-step process for opening an LLC
1. Choose the best business name for your company and check the Secretary of State's website to ensure it’s original.
2. Specify the address of your company.
3. Check your local zoning laws: Ask your local zoning board any questions you may have regarding licenses and permits. Some neighborhoods do not allow home businesses.
4. Appoint an agent (Agent for Service of Process) responsible for receiving legal documents and notices for the company. If you do not plan to hire a specialist for this role, you can perform the agent's functions yourself.
5. File Articles of Organization with the Secretary of State. Official registration makes your company a separate legal entity. Many banks and investors only provide financial support to officially registered companies. This is one of the first steps to creating a legal, reliable, and financially sustainable business.
6. Obtain an EIN from the IRS that identifies your business entity. An EIN (Employer Identification Number or Tax ID Number) is required to do business.
7. Open a business account. Once you have your EIN, you must open a business bank account. The bank does not have to be in the state where your LLC is registered, but it must be in the United States.
8. Set up business finances, including bookkeeping and tax obligations. Every limited liability company (for example, established in California) must pay a mandatory annual tax of $800. First, fill out the LLC Tax Voucher. Then, pay the tax online using web payment or a credit card.
Design your home workspace
"The new definition of success is not about the most revenue, employees, and office space but the most profit, generated through the fewest employees and with the least expensive office space." ― Mike Michalowicz, 'Profit First'
You don't need to invest in a physical location to start a successful business. However, you should create a comfortable and inspiring workspace to make working from home enjoyable and efficient.
Choosing the right surface for your home office space can boost productivity and comfort. Look for a spacious tabletop to fit your computer, and consider storage options like drawers or shelves. Table height is crucial — too low can cause slouching, and too high may strain your shoulders and wrists. Consider a standing desk to avoid the adverse effects of prolonged sitting. It might feel different initially, but it's beneficial in the long run.
Position your desk near a window to maximize natural light, enhance your workspace, and protect your eyesight. Happy working!
Develop a marketing and sales strategy online
Online advertising is vital in today's dynamic economy—it's no longer just a nice addition to traditional business! If you're an entrepreneur eager to tap into the Internet's incredible ability to draw in customers, you're probably asking yourself how to kick off your online advertising journey.
Here is the minimum you will need to start:
A single-page landing page, a business card site, or a simple online store if it’s about e-commerce
Basic SEO optimization so that the site ranks high in a search
Installed codes from Google Analytics and Facebook Pixel to collect and analyze the behavior of visitors on your site
A brief campaign in contextual advertising is necessary if the niche is not overly expensive
Social networks and targeted advertising
Create company pages on social media and design them in a corporate style (or just beautifully)
Publish several posts to attract the attention of users who will click on them and encourage them to subscribe
Prepare advertising materials for upcoming campaigns: texts, images, and videos
Run test ads and collect analytics and audiences
Use social media wisely, and more potential consumers will learn about you. According to global statistics, about 70% of companies attract new customers from their Instagram profiles.
Take the first step toward your dream business with Headway summaries
We live in an era of unlimited opportunities. Now, enough people are ready to take risks and realize their dreams and career ambitions. In this world, there are as many paths to entrepreneurship as there are entrepreneurs themselves. By analyzing and studying their experiences, you can become a successful home-based business owner.
The Headway app provides summaries of popular bestsellers and top business books to help you learn how to start your own small business and learn more about entrepreneurship. With the Headway app, you can easily read or listen to key ideas from these books in podcast format, allowing you to grow in various areas of interest. Most importantly, the Headway app saves you time, ensuring you get the most out of your reading experience.
