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Want to start a business as a college student? Here are the tips

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Being observant and a problem-finder should be the way for students looking to be business founders

Microsoft, Facebook and Reddit. What’s the similarity between them? All of these pioneering tech companies were started by college students, and later went on to become success stories. These are all tales of the perfect marriage between talent and hard work. These stories still inspire youngsters, especially the ones with entrepreneurial traits.

If someone goes through the list of legendary tech industry bosses (for example), it contains names like Michael Dell, Mark Zuckerberg and Steve Jobs, who were college dropouts. Now the temptation will be there to follow a similar path and choose business over studies. However, this article will show its readers ways to pursue their entrepreneurial traits, while continuing their education.

Also, don’t forget that universities often offer an abundance of resources to students, including start-up competitions, advisors, and tech labs. And these resources are more than enough to help students with entrepreneurial traits to pursue their dreams.

And this article will further shed light upon the above fact.

Start Making Contacts

Evaluate the college/university environment, study the kinds of people who go there, and then, start connecting with them. See if they are passionate about being entrepreneurs and what their interest areas are. If they pass your vibe check, connect with them.

A very good case study here is the formation of Facebook in 2004, when Mark Zuckerberg, along with his friends Eduardo Saverin, Andrew McCollum, Dustin Moskovitz, and Chris Hughes started the digital platform to connect people around Harvard University. Then it got a good craze among the collegegoers in the Boston area and in no time, made the concept of “Social Media” a mainstream one.

Also, Along with entrepreneurial traits, you need leadership and decision-making abilities. Expose yourself to new opportunities like extracurricular activities on campus and internships. The relationships you establish in the process will enable you to start the process of creating your own inner “Business Network,” which will be a handful as you progress professionally.

Attend Business/Entrepreneurship Classes

“Taking entrepreneurship classes is like building up your muscles for the big fight,” said Mike Kyriacou, a lecturer at UC Berkeley who teaches a topic called “Venture Applications of Data Science.”

“Classes are a risk-free environment where you can try out experiments — and that will help students to be more prepared when they venture out into the real world,” Kyriacou told CNBC.

Since in the first two points we have emphasised building connections (be it with classmates or professors), these business/entrepreneurship classes also present opportunities to level up the connection game further.

“They’re going to be execs here or there so you’re building relationships with each other and you all become great dots to connect with each other in the future,” Kyriacou said.

Pedro Pachuca, who studied electrical engineering, computer sciences and business administration at UC Berkeley, is also known as the co-founder of SportVue, a start-up aimed at revolutionising the way athletes train. Pachuca started the company during his freshman year with his friend and roommate, James Li.

Talking about the utility of attending business/entrepreneurship classes, Pachuca told CNBC back in 2020, “In business classes, professors try to codify intuition and then teach it to other people, which works to an extent, but it’s hard for students to pick up on intuition. I think business school really gives you a lot of good frameworks to think about. For example, they gave us frameworks on how to categorise customers which I think I’ve used a lot.”

Chris Cherian, the CEO of Gatherly, a start-up aimed at transforming how online events are held, said that the technical financial modelling skills he learnt from classes have been extremely helpful for him in real-world scenarios.

Draft Business Idea

Being observant and a problem-finder should be the way for students looking to be business founders. Pay attention to problems you or someone else has been facing daily, problems which can be sorted out through some expertise that you possess. Remember, necessity is the mother of invention.

For example, Cherian and his Gatherly team realised the need for a better way of hosting large events online when they attended a conference, where “it felt like you were in a large room with 300 people all in a giant circle.”

Talking about finding business ideas, Pachuca remarked, “One guy just not too long ago was travelling with a suitcase and thought ‘Dang my luggage is really heavy.’ So what did he do? He slapped the wheels on the luggage. Suitcases had existed before this for many years, and wheels had existed before this for many more years, but no one had thought to put them together until he did. And this is because everyone had this pain point but just said ‘This Sucks,’ but no one did anything about it until he thought of solving it. And that made him a lot of money because he solved a problem for a lot of people.”

Give Shape to Your Idea

Find the customer base that will benefit from your product, and check whether your solution is unique/first-of-a-kind in the market or not. Research further to find out whether any other venture is already working on a similar concept. If that’s the case, explore the ways you can refine your products and make them stand out from the rest. Also, take into consideration factors like cost friendliness.

Rigorously test your products (in a prototype manner, while emulating various operational scenarios), to make sure that the solution helps your potential customers perfectly. Conduct “Customer Discovery Interviews” to understand exactly what kind of products your potential customers are expecting.

Make an MVP (minimum viable product) which will serve as the baseline of the ultimate product that you will launch in the market. The idea behind MVP is the smart utilisation of efforts and money at an economic scale. Hold “Prototype Interviews,” where you show off your MVP to users to showcase that your product is actually solving their problems. Speak with your potential customers again and again to make sure that you are not wasting your time building features that users don’t want.

Sharpen the Business Plan Further

A student entrepreneur’s business comes under the start-up category, where it needs to go through stages like marketing, raising investments, experimenting with revenue, expanding the team, and many other options. To make things easier, hiring a “Business Mentor” is not a bad option, as he /she will help you and your team to guide you through the initial push and pull forces of the market.

Prepare a vision document that will contain a basic description of your business, along with an in-depth look at your venture’s uniqueness, target audience, its immediate and long-term goals and the strategies to achieve them.

The document should also present a detailed outlook of the industry vertical where your business is serving, the overall competition within the sector and how your product is different from those of rivals.

Also mention the profiles of your team members (including their roles in the business), and your financial numbers, including a projected cash flow, profit and loss, break-even analysis, and outline of the funding required from investors. Also inculcate documents like industry studies, trademark registrations, and letters of incorporation.

Build Your Credit

According to a study of millennial small business owners by Wells Fargo, 14% of the surveyed individuals started their businesses by using a personal credit card instead of taking out a loan.

“Because of their young age, size of their businesses, and annual revenue, many, unfortunately, do not qualify for the same kind of financial assistance given to established business owners. College students and graduates alike who may be funding their start-ups on personal credit need to make sure they establish strong credit early on by never missing monthly payments and by paying off debt,” states AllBusiness.

Ensure that your business plan includes a financing request required from investors interested in your business. Learn and practice the art of pitching people with your business ideas while you are in college/university. Many universities hold pitching competitions for start-ups where students can deliver presentations in front of a panel of judges and audiences, who then vote on pitches they like the best as well as critique them.

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