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Entrepreneurship

How To Become Financially Independent

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How to be financially independent

What if you didn’t have to be dependent on anyone? What if you could decide for yourself what you do with your time and how you spend your day? What if you had the freedom to start your own business? What if you could spend time with your family and not having to worry about meeting a deadline? What if you had all the tools and resources to take control of your life? 

Imagine being your own boss. Having the opportunity to shape your future and achieve all your dreams? Well now you can. This entrepreneurial blog will help you start a business from scratch, and turn it into something that will be sustainable for decades.

“Today’s freedom thinkers are people who have control over their life. They’re no longer confined by their old way of thinking.”

Plan Ahead

The first step in becoming financially independent is to create a budget. If you know how much money you have coming in and going out each month, then you can plan for your future and know exactly what you can afford. You need to create a simple, five-year plan. Think about your short-term goals and how you can achieve them. These goals will be things like where you want to live, what kind of car you want to drive, and what you want to do with your spare time. 

Find your Tribe

Whether you’re a freelancer or a budding entrepreneur, it’s important to remember that you’re not alone in facing these problems. Don’t let the fear of what others will think of you hold you back from reaching your goals. There are many ways that you can start to make money, but you’ll probably have to try a few different things before you can find a successful business model. Try out different things and you’ll eventually find something that works. Chances are, if you’re struggling with something in your business, there are others out there who are facing the same thing. Finding a community who you can connect with and talk to is important so you can bounce ideas off of each other and help each other work through problems.

Stop wasting, Start saving Money

If you are serious about making money, you need to learn how to make money. There are no shortcuts. You can’t just “figure it out” along the way. Although you can’t become a millionaire just by learning how to save and manage my money, it is one of the most crucial steps for starting a business. Saving money isn’t about depriving yourself of every single thing you want, it’s about learning how to live within your means. And there are a lot of ways to make money online, and every single one of them is a skill. 

Start thinking like an Entrepreneur 

A lot of business owners are afraid of thinking like an entrepreneur because they don’t want to be perceived as “unprofessional,” but that sort of thinking is a huge mistake. The truth is that if you’re not thinking like an entrepreneur, you’re thinking like an employee. And the only way to become an entrepreneur is by thinking like one. 

A lot of people are afraid to take risks or don’t think about the future because they’re afraid of failure. This is a huge mistake. Not thinking about the future means that you’re not thinking about the consequences of your actions now. You really need to think about the big picture and focus on the long term.

Smart work, not hard work

It’s important that your hard work is smart. If you’re working hard and not getting anywhere, you might want to re-think your strategy and figure out why you’re not getting the results you want. If you’re working on the wrong things, no amount of hard work is going to help you succeed. It’s better to be smart than it is to be hardworking. If you want to grow your business and have more time to focus on the things that matter, you’re going to have to start outsourcing a lot of the work you’re doing right now. It’s a fact that the more you grow your business, the more time you have to focus on the things that matter. 

Elena Hudgens is an entrepreneur with 10+ years of experience. She started her journey by building her own e-commerce website on Shopify and turned her $1000 savings to millions in just 2 years. Soon she started different ventures in which she failed and succeeded. And now, she's on a mission to help other entrepreneurs with her life and business lessons.

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Entrepreneurship

How Do Crowdfunding Platforms Make Money?

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how crowdfunding platforms make money

It’s a question I get a lot: How do crowdfunding platforms make money? The answer is that crowdfunding platforms make money in a variety of ways, but the main source of their revenue is fees. In this post, we’re going to go over how crowdfunding platforms make money.

What are crowdfunding platforms?

Crowdfunding platforms are websites that allow people to donate money to entrepreneurs and startups in exchange for future products or services. If you’ve ever backed a project on Indiegogo or Kickstarter, then you’ve participated in crowdfunding.

How can you make money on crowdfunding platforms?

Before we talk about crowdfunding platforms make money, we need to talk about how you can make money from them in the first place. When you run a crowdfunding campaign, you set up a special website that lets people (i.e. investors) use your fundraising site to give you money. So why would you do that? Because you want investors to help you raise money to build your company. When you set up a campaign for a startup, you’ll usually have two options: Go for a Kickstarter-style approach where you set a goal and try to get as many people as possible to give you money. Or go for an Indiegogo-style approach where you set a goal and let people contribute what they want, not necessarily what you need. Before you choose which approach you’re going to go for, you’ll need to set up your campaign.

How Fundraising Crowdfunding Platforms Make Money

In this section, we’re going to cover the business model of the most popular crowdfunding platforms, as well as the campaigns they support and their fees. What do these platforms do? Crowdfunding platforms offer opportunities to raise funds for a wide variety of creative projects, from film projects to business ventures to personal endeavors. You can set up a campaign through any of these platforms, starting with Kickstarter and Indiegogo. You’ll need to choose which platform you want to run your campaign through. Many sites offer advice and assistance if you run into difficulties with setting up your campaign, so you can use that to make your decision. These platforms can help a campaign succeed by lowering costs or cutting fees if they run over budget.

How Equity Crowdfunding Platforms Make Money

Funding Circle is the leading equity crowdfunding platform in the UK, having been active since 2012. They have recently launched an equity crowdfunding platform in the US and in Ireland. In 2015, they secured £155 million for 916 loans. The platform is divided into five market segments. They offer different types of loans, among which the following are quite useful for startups:

  • Small Business Loans – This segment deals with small loans up to £250,000. Unlike Peer to Peer lending, small business lending is a transaction between a lender and borrower, rather than an investor coming to the market for exposure to peer-to-peer lending. 
  • Personal Loans – You will find personal loans in the personal loans category. Unlike Small Business Loans, there is no exchange of money with a lender.

How Donation Crowdfunding Platforms Make Money

While some donation platforms do make money, most don’t. In order to support themselves, most crowdfunding platforms use revenue from transaction fees to keep operations going. So in a nutshell, donation platforms make money by taking a fee on donations they receive. Fundraisers do not receive a transaction fee from the platform, but they can receive a percentage of each transaction they facilitate. When a donor wants to give money to a cause, the fundraiser may have to send a code that is scanned in by a reader on the platform. The donor then pays the platform a fee for this service. 

The best crowdfunding platform and how much they charge

There are a number of crowdfunding platforms to choose from, but I’m going to focus on the three main players: Indiegogo, Kickstarter, and GoFundMe. 

1. GoFundMe is perhaps the best known and most popular of the three platforms, and the one we’ll be discussing most in this post. GoFundMe charges a 1.9% fee for all donations over $20. 

2. Kickstarter charges a 5% fee on all payments and merchandise sales. This 5% fee is a flat fee per transaction and not dependent on the amount of money raised. Kickstarter charges a 5% fee on all payments and merchandise sales. This 5% fee is a flat fee per transaction and not dependent on the amount of money raised. 

3.  Indiegogo charges a fee of 5% of the money you raise, and a payment processing fee of 3% + $0.20 per pledge. This means that if you raise $10,000, you will receive $9,500. If you raise $20,000, you will receive $19,000.

Conclusion

Have you been looking for a crowdfunding platform to help your business and you’re not sure where to start? Don’t fret! Crowdfunding platforms are relatively easy to set up and use, so there shouldn’t be any barriers for you to create your own platform. The main thing is to find a platform that fits your business, the resources you have available, and the way you want to use it.

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Entrepreneurship

How to Create an MVP for Your Startup: A Comprehensive Guide

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MVP

The Minimum Viable Product is the version of a new product that allows a team to collect the maximum amount of validated learning about customers with the least effort. It is important to note that an MVP is not a stripped-down version of a product. It is just a product with the essential features to test the most important assumptions.

Why Do You Need It?

The Minimum Viable Product (MVP) is one of the fundamental building blocks of any product. It allows the team to validate its assumptions before making its next step and iterate to further improve the product. It also serves as a hub for collaboration and feedback of potential users. In order for a company to progress, it must understand its audience and respond accordingly. 

How to build an MVP as quickly as possible?

Start with the assumption that you will have two types of users (vendors or customers): Users that know your product, who you know well and can provide feedback, and generally have a high level of trust. Vendors that want to build a product, but might not know you well, and might not be in a position to provide deep feedback. For the purpose of this post, it will be assumed that both of these groups exist for your product. The term “minimum viable product” refers to this first group, which will allow you to learn the most, faster. This first version might not be polished, but that will come later. We call this the sales phase. For this example, our sales phase will look like this: An initial list of vendors that would like to buy our product.

How to Find Your First 10 Customers?

Getting your first customer can be a frustrating process. It could be the lack of sales leads, lack of a full-time marketing team or a marketing budget, or simply a customer need that was not yet fully met. Once you’ve reached a milestone with at least one customer, you’ll likely need to find a customer acquisition cost to test the product with new customers. One method for determining how much a customer should cost is to keep track of how much they spend to acquire you. Start by determining how many potential customers your product could reach, using the following question: “How many more customers could we reach if we sold X amount of product?

How to build a Minimum Viable Product?

To generate and validate learning about your customers, you can do something like this: Include different usage scenarios for your product. For example, if you are creating a financial service app, include login scenarios, report generation scenarios, and even mock transactions. Use your testing scenario to come up with test inputs and outcomes that will elicit the most learning from your users. Take the time to dig into your customers and understand how they interact with your app. You can test the delivery of different scenarios by tracking user behavior in real time. A key feature of an MVP is the ability to collect data on customer behavior in order to evolve the product along with the customers.

The MVP process

As previously mentioned, the idea behind the MVP is to be as lightweight as possible. You want to build your MVP without making significant changes to your technology, only focusing on the elements that your product needs to have to get some results. In terms of user experience, you want the app to be very straightforward and simple. 

You can follow these simple steps to build your MVP:

  1. Define your MVP
  2. What will you offer? 
  3. What are you going to test? 
  4. Determine your desired results and how are you going to measure? 
  5. Find out what you need to do to get there
  6. Create a plan of action
  7. Implement your plan of action
  8. Build your MVP 
  9. Test your MVP 
  10. Find a way to measure your progress

Conclusion

Every startup needs an MVP, even a never-ending journey of moonshot ideas. You need to test your assumptions and come up with prototypes. Your startup needs the Minimum Viable Product (MVP) to know what needs to be polished and refined before going for the Production version. You cannot proceed to the next stage of your startup unless you have confidence in your product and its main points.

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How to avoid top mistakes when starting a business in 2021?

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top mistakes when starting a business

Starting a business is like jumping out of an aeroplane without a parachute. But if you do it right, you can reach the stars. You’re the skydiver, and your business is the parachute. If you’re going to jump, at least know what you’re doing wrong so you can avoid them all! Here’s how to avoid top mistakes when starting a business in 2021.

Be flexible and willing to change.

In general, if you’re going to build a business, you’ll have to constantly change and adapt to changes in your market. That requires a lot of flexibility and adaptability. 

Avoid burnout by keeping a flexible schedule. If you’re burned out, it’s hard to deliver a high-quality product or service. 

You’re unlikely to work as long or hard as you need to to achieve your goals. Thus, don’t try to get too far ahead of yourself. If you look too far ahead, you risk getting lost in the fog. 

Too much focus and work on the future can prevent you from getting things done now. 

Don’t be afraid to find new talent if you need to. I’ve always had to be willing to let go of employees when we needed to make changes to our business.

Don’t be a jack of all trades, master of none.

Being too mobile is a nightmare, especially in the early days. No one can give you an extra edge or even give you a hand at the start of your business. In fact, most experienced entrepreneurs advise you to think seriously about getting a support team in place before starting your company, or even in the middle of it.

Build a team around your skills, not the other way round. 

Don’t choose to launch without having a vision for your business. Don’t launch your company without having a vision for it and your positioning. There’s no point in launching if you don’t know what you’re trying to do.

Don’t underestimate the need for planning and take only calculated risk.

Know what you want, and make sure you’ve done your homework. Study your target market to find their unmet needs, and invest the time, money and emotional energy to create a product or service that satisfies those needs. 

Success is no accident, so make sure you set yourself up for success by doing your research. Now, how will we do that in 2021? The simple answer is identify target markets and grow your brand presence. Do you know your local coffee shop audience? Do you know your telecom sector or automotive industry? Think about what your customers are interested in and start producing unique products or services for them. 

Don’t just create a product, test it and learn from your customer. Listen to what they tell you, test it and learn.

Make sure you know the caliber of the people you hire.

For many businesses, it’s not just about how much money they make, it’s about who they make it with. Finding like-minded entrepreneurs in your area is an important step to taking your business to the next level. And finding people who share your passion is an even more important step. It’s about finding people who will make your vision come true. It is still the biggest business decision, and it’s important to do it right. Before hiring a graphic designer or business owner, make sure you know the caliber of the person. 

Learn from other people’s mistakes.

I find it incredibly valuable to observe other people’s mistakes. Find those that haven’t worked out, and figure out what went wrong. Usually the ones that didn’t work out can be attributed to one of a few things: 

No clear end-point (i.e. is it growing or dying?) (i.e. is the business a hobby or a business?

Lacking financial clarity (is the company profitable or not? And if not, when do you expect to be?) 

No actual product or service (is it just a logo on a website?)

Miscommunication (did you communicate the value of the business well enough with your potential customers?

Always have a backup plan.

Your business is your baby and you’re the parent. You can make it better than anyone else. You don’t always have to come up with the perfect idea, just a decent one that can bring in money and be profitable. When you’re starting your business, there is no hurry. In 2021, you’ll have time to grow and make mistakes. But if you want to get really good, and start growing into a well-known company, you have to take action now. You have to push forward. Only invest in businesses that are real. We spend so much time looking at data about how other businesses are performing and how other companies around the world are performing. In the future, you won’t need to compare your business to anyone else. You’ll only need to do it against your own goals and capabilities.

Don’t be afraid to trust people with your money.

More often than not, if you’re trusting people with money you don’t have yourself, it’s because you haven’t taken the time to train or hone your skills enough to lead a successful business. This is a big mistake. Sure, you may need help from an expert, but your business will be stronger if you learn to make these major life decisions on your own first. When you’re trying to launch, you’ll be spending a lot of money and there are always plenty of folks ready to ‘save’ you, but there’s no one person who will get you to where you need to be faster. So focus on honing your skill set and making sure you’re covered if things don’t work out. Have the right business structure in place.

Don’t be afraid to try new things.

You never know where the next idea will come from or what new niche your business could fill. The bigger the risk the greater the reward. Don’t be afraid to try new things. If it doesn’t work out, you’ll learn something and find a different angle. Balance the money and profits. Running your own business is a full-time job. So it’s essential you find the balance between money and profit. You’ll want your business to grow and reach its potential, but you don’t want to spend all your time worrying about your bills or where your next meal is coming from. Don’t be afraid to admit when you’re wrong. You’ll face your share of challenges, but at the end of the day, you can always rely on your own gut instinct.

Not investing in your company’s future before you start. 

One mistake I see a lot of people make is that they jump out of the plane without preparing properly. That’s like cutting the cord with your parachute too soon and losing it. When you’re first starting your business, it can be easy to get caught up in things like building an infrastructure for your business (i.e. sales and marketing strategy, ecommerce site, etc.) but without a long-term strategy, you might not be able to do that without getting yourself into more trouble. So, invest in your future by setting yourself up to reach the heights you want to.

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