Turning obstacles into opportunities
The task of starting a business during coronavirus may seem challenging, but the truth is that starting a business any time is tough. However, it could pay off if you take the right steps.
"This is a historic moment to identify new business opportunities and to transform how you operate," says Van Goodwin, founder and managing director at Van Allen Strategies. "Availability of financial assistance is at a historical high, as is the availability of labor. Your customers, employees and partners are hungry for new ideas and open to change. Take advantage of that. This is an economically difficult period, but also a once-in-a-lifetime opportunity to reinvent your business."
If you are looking into starting a business during COVID-19 or pivoting your current business, here are six tips to keep in mind.
1. Determine why you’re going into business
Take some time to think about why you want to pursue starting a business at this time. Deborah Sweeney, CEO of MyCorporation.com, says the "why" can range from being passionate about an offering or service you can provide to wanting to make a difference in your community and fulfill a need for consumers. Maybe you're just ready to strike out on your own after going through a coronavirus-induced layoff.
Once you know the "why," you can set clear goals for your business. "These goals may be on a short- and long-term basis," Sweeney says. "You should be able to understand what makes your business unique, choose a business model and draft a business plan. Finally, you'll need to incorporate the company as a business structure, such as a limited liability company (LLC), to protect your assets with liability protection and establish credibility with consumers."
2. Start as a side hustle
Many successful entrepreneurs started their business as a moonlighting venture and cultivated it as they kept working at their primary source of income. If you still have a day job, you may want to consider holding onto it until your business is providing you a livable income, advises David Vranicar, managing partner and founder of FBS Fortified & Ballistic Security.
"Slowly build that side hustle by investing your time and energy into it after hours," he says. "If you work hard and truly have a unique product to sell, the money will eventually come."
3. Decide what tasks you can do — and what you need to delegate
If you're starting a business during COVID-19 and thinking you can run every aspect — from social media to accounting to administrative tasks — you may burn out quickly. Instead, choose which ones you can actually do and then find help for the rest.
"Take stock of what needs to be done, and put the tasks requiring more cognitive labor first. You'll be preserving more of your energy and focusing on the essential tasks only you can do," says Liz Elting, founder and CEO of the Elizabeth Elting Foundation and founder and former co-CEO of TransPerfect. "The ones you can't do, you can delegate those to someone else. Respect yourself, your capabilities and your limitations."
4. Hire freelancers
You may not have the funds to take on full-time or even part-time employees when you're starting a business during coronavirus. Instead, hire freelancers, who are going to be much more affordable and convenient.
You can find affordable freelancers on sites like Upwork and Fiverr who can do everything from marketing to content writing, web design, social media management and graphic design. Plus, you will only have to pay them for services rendered rather than a salary, benefits and workers' compensation, which could save you thousands of dollars. You may be required to send out 1099 forms in January to any freelancers you used during the previous year, but your tax advisor can assist you with that. Some freelancer sites take care of all of that for you.
5. Research small business funding
The government encourages people to start companies by providing small business loans. These SBA loans are for people of all backgrounds. You can log onto the SBA's website to apply for them. For example, you can see if you qualify for SBA loans for women or loans for veterans.
Additionally, you can look into small business credit cards to provide funding for equipment and any other essential startup costs. You'll want to make sure you pay your bill in full every month so you can build your business' credit and not take on unnecessary debt as you’re embarking on your venture.
6. Invest in social benefits
Whether you're starting a business during coronavirus or you're pivoting your current one, you can show that you care about the state of the world and give your customers a chance to show that they care about current issues.
"Add a social benefit to purchasing from your business," says Camille Chulick, co-founder of Averr Aglow. "More than ever, people want to feel that their purchases make some sort of difference. Donate a portion of proceeds to current issues. Provide a free bottle of hand sanitizer with every order. Send something to frontline workers. Give your customers an extra reason to maintain loyalty."
Emerging stronger from the COVID-19 economy
Thankfully, some people are going back to work, but for many, times are still tough. People are suffering from financial instability, and they don't know when things will get better. However, if you have a good business idea and the resources to pursue it, you should consider starting a business during COVID-19.
Remember to determine the "why" of your business, hire the right people, know your limitations, start as a side hustle, look into loans and credit cards and show that you care. You might just end up as a successful entrepreneur at the end of this.
"I have heard several entrepreneurs say 'this too shall pass,' and I think it's the growing mantra for the time," said Sweeney. "We will emerge from this stronger and nimble, ready to hit the ground running with new ideas and concepts for being in business."
Kylie Ora Lobell is a writer for MoneyGeek.