Four questions to ask yourself before you start a business

So, you want to start your own business? Join the club! Going out on your own has been in vogue for some time now, with roughly a third of the Australian workforce estimated to be freelancing in some capacity. Terms like start-up, entrepreneur and the gig economy are now engrained into the modern vernacular as we continue to transition away from the idea of spending an entire career at one company or in one role.

While the prospect of launching your own business is exciting, it is also very challenging. Here are four questions you must ask yourself that should hold you in good stead if you decide to take the plunge.

What’s your financial situation?

Starting a business can be costly, so it’s important to ensure you have a safety net for the initial stages where you may not be earning an income. This includes having money to cover all the essentials, such as rent, food and utilities for an extended period of time, allowing you to commit your time and effort towards getting your project off the ground without the stress of wondering where your next meal is coming from.

Do you have a business plan?

This isn’t the type of thing you want to go into ad hoc. Developing a business plan is crucial – it outlines the fundamentals of what you want to do and how you will achieve it, from the purpose of the business to customers, competitors, position in the market, pricing and projections for the future. If you have any friends or acquaintances who have been through the same process, be sure to seek out their feedback.

Do you need a co-founder?

It’s something that might not have crossed your mind in the past but have you considered a business partner? A co-founder not only eases the pressure from a financial perspective but provides another person with a vested interest in the business succeeding to bounce ideas off. Be aware that potential complications can arise from having too many cooks in the kitchen, so think carefully about whether you can go about it on your own.

Why are you doing it?

What was it that set you on the path to kickstarting your own venture? Perhaps you always wanted to work for yourself, or maybe you’ve became disenfranchised with your career trajectory. Whatever the reason, take some time to assess whether this will be the best move for you from both a professional and a personal perspective.