Everything You Need to Know When Starting a Business From Home

Tired of the 9 to 5? You’ve read “The 4-Hour Work Week” and think you’re ready to take on the world? This guide will help take you from the office cubicle (or, even worse, the ‘open plan office’) and the horrors of the rat race to a business you can run from the comfort of your own home.

 

Know Thyself

Everyone can moan about a manager. They’re doing it wrong. They’re completely useless. You’d do it much better. Or would you? You’re in the driver’s seat now. But before you turn on the ignition, it’s time to do a little self-reflection:

 

 

• The Why. You need to ask yourself why you’re embarking on this venture. If all you’re thinking is money, you’re setting yourself up for failure.

• The Side Hustle. You may not be ready to go full-time with your business. Small businesses fail all the time. 20% of them go belly up within their first year, while 50% are gone within five. It’s not guaranteed. Perhaps a side hustle is a safer jump to make.

• What are your (real) skills? You need to know what you’re good at. But more importantly, know your weaknesses. Where do you need help? Where do you fall short? What will stop you from successfully delivering your product or service?

• What’s your plan B? Starting your own business will take unexpected twists and turns. If things aren’t working, have a plan B in place.

 

 

The key thing when answering these questions is to be completely honest with yourself. Don’t pull the wool over your eyes. Don’t lie to yourself just because you really want this business idea to work. If you’re unsure, ask former colleagues or others you’ve worked with before what they think.

 

Where’s the Money Coming From?

There are no two ways about it: starting a business takes a fair amount of money. According to the U.S Small Business Administration, it takes most home businesses around $1,000-5,000 to get started. If you’re a little more ambitious, however, you’re going to have to raise more than that. To raise capital, consider the following options:

 

 

• Don’t. Save up your money, start a side hustle, and build up your business slow but steady. Minimal risk, but it’s going to take a lot of time.

• Business loan. These can be a little pricey, so proceed with caution.

• Angel investors. There are plenty of investors out there looking to pour money into the next Facebook or Whatsapp. However, be careful: they may want a larger chunk of your business than you may be willing to part with.

• Home equity loan. If you own your property, you may be able to extract your initial business startup costs from your home loan. Check your local lenders and banking institutions for the best possible deals and use available tools provided online, so you can calculate your equity and gauge your fiscal capabilities.

 

 

Examine the Market

Before diving headfirst, make sure you know the market you want to operate in. Figure out what it’ll take to get noticed. If you’re going to hit against the big boys, do you have a USP (unique selling proposition) that sets you apart? What about marketing? Do you have a budget to invest in Adwords, Facebook Ads, or local business listings?

 

We recommend ‘watching’ the market first. It can take a little while to catch the nuances that make things tick. Think of it as a professional surveillance operation. Stalk your future competitors, talk to other business owners, and figure out what customers like and what drives their buying habits.

 

Is your answer ‘build it and they will come’? If so, try again. You need to have an expert’s view on how your target market and customer operates. Otherwise, you may as well start preparing your bankruptcy paperwork.

 

Cover Yourself with Insurance

As you may have noticed, we hate the gung-ho approach. You should always have your back covered just in case the worst happens. Consider the following insurance options:

 

 

• Health insurance. If you’re the only one working in the business, it’s key that you have a decent health insurance package.

• Home insurance for your business. Running your business from your home? You may need a separate insurance policy. Check with your provider.

• Liability insurance. Should someone get hurt, you need liability insurance. Whether it’s a customer or an employee, be covered.

 

 

Set Up a Comfortable Working Space

You may have seen that super cute video where a BBC interviewee is interrupted by his daughter. While ‘aww’ is probably the normal person’s reaction, we immediately wondered about the office space. Setting up the right home office is absolutely crucial.

 

You need the space and the time to deliver focused work. Procrastination is an enemy. Distractions (such as children!) should be minimized wherever possible. We’ve known many home business owners who have succumbed to the lure of Facebook and Instagram during “office hours”.

 

The key to a home office is privacy. Don’t set things up on a desk in your living room. If you have kids running around most of the day, then working from home may not be an option? There are ways around this that won’t kill your capital:

 

 

• Co-working space. This option is inexpensive and convenient. San Francisco is probably the best place to find a really cool space that offers high-speed internet, a quiet place to work, and other like-minded individuals.

• Small business incubator. Governments are usually in charge of these (or business development groups) and they provide office space for startups. These can be a really good option, as they sometimes come with mentorship and other perks. You’ll have to apply though, and competition can be stiff.

 

 

Okay, so maybe ‘everything’ was a slight exaggeration (hands up if you’re guilty of clickbait!). Nevertheless, we think this guide offers a comprehensive starter pack for those of you looking to start your very own business. Just bear in mind that in the end, it’s (mostly) about what you put it in. Reading a bunch of guides will set you on the right path, but it won’t do the work for you. Now get out there and take action!

 office with laptop and gun– stock image

 

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