Are you a young entrepreneur brimming with new business ideas and full of excitement for bringing them to life? You might be wondering if it’s wise to start a small business, and if so, what you need to do to make it happen.
There are tons of benefits to being a teen business owner, as long as you have the support of a parent or guardian to handle the legal requirements involved. Let’s take a look at why it can be a great idea, and how to start a business if you’re under the age of 18 and have no experience.
Why you should become a young entrepreneur
Let’s take a look at a few reasons why it’s a great idea to become a teen business owner.
You have more time now than you will later
Teen entrepreneurs tend to have a lot on their plate in school. In addition to your studies and your social life, you might also be juggling some hobbies or extracurricular activities like sports or clubs. When you add everything up, it can feel like your plate is full.
But this is only the beginning! As you grow older, you’ll likely find that your schedule is even tighter, with more pressing responsibilities. That’s why now is the perfect time to try launching a potentially profitable business idea. You’ll learn many valuable life skills along the way.
You have access to various free resources
Those in school have access to many resources—from labs and tech equipment to computers and software. Your teachers, counselors, and fellow students can also offer valuable knowledge and feedback.
Additionally, you can tap into other resources like:
- Art studio and shop class tools
- Specialized elective classes for young entrepreneurs
- School clubs and organizations focused on business and leadership
Make the most of these free resources while you can. After high school, everything from education to entertainment will cost more, so take advantage now to build your skills and save money.
The skills you acquire will help you in the future
You can expect to wear many hats in the first year of starting a business. From driving sales to managing customer service, you’ll gain a variety of skills quickly. This applies to entrepreneurs of any age. These experiences will help you build a skill set that will be valuable in the future, whether for college applications or in your career.
How to start your own business before turning 18
Now that you know all the benefits of being a young business owner, let’s take a look at the steps you need to take to get going.
1. Make sure your parent or guardian is on board
Before you start making your idea into a reality, you’ll need to get buy-in from a parent or guardian. This is because there are legal requirements you can’t meet on your own if you’re under 18 years of age.
These might include things like signing contracts and legal documents, setting up your own business entity like a sole proprietorship or LLC, getting a business bank account, and creating your online business accounts like PayPal and Stripe for handling payments.
If you plan to use social media accounts as part of your sales or marketing plan, you may also need continuous supervision from your sponsor to get those set up and keep them running.
2. Validate your business idea to be sure it’s viable
One of the biggest mistakes new business owners make is failing to validate their idea. Here are some ways to do so:
- Do market research to understand your target market. What are their pain points? How are they solving the problem now? What are their preferences, needs, likes, and dislikes?
- Examine your competition. What are those businesses offering? Where do they fall short, and how can you fill the gap? If you don’t have any direct competitors, look at the closest ones you do have.
- Conduct interviews and get feedback from potential customers, as well as mentors and others in the industry or niche. See if there are ways to refine or tweak your ideas based on what you learn.
- Launch a minimum viable product (MVP), or a basic first version of your product or service. This could be as easy as a landing page to get email signups and gauge early interest.
3. Seek out the funding you’ll need
Depending on the nature and scope of your business, you may be able to generate the funds on your own. This is especially true if you have a part-time job and don’t need a lot of capital upfront. You might also ask for some financial help from family, like the parent or guardian who’s sponsoring you on your entrepreneurial journey.
Here are some ideas for generating funding, if you need an extra financial push:
- Crowdfunding platforms like GoFundMe, Kickstarter, Indiegogo, and Patreon.
- Grants or competitions, especially ones specifically made for teen entrepreneurs.
- Partnerships with other individuals or entities that can provide you with the resources you need.
Here’s the Kickstarter page for the teen business Curly Petz, which generated more than $15,000 in funding.
4. Get set up with the help of your parent or guardian
As mentioned above, you’ll need your parent or guardian’s help with business setup, including things like:
- Legal structure. Will your business be a sole proprietor, a partnership, a limited liability company (LLC), or something else?
- Financial accounts. It’s best to open a separate business bank account for your business to keep your finances organized.
- Permits and licenses. Check with your state and local governments (and the federal government, of course) to see if you need any special permits or licenses to operate your business.
- Taxes. Be sure you and your sponsor understand your tax obligations and set up a system for tracking income and expenses.
You should also consult with your parent or guardian about the following:
- Pricing your products and services. Check competitor prices and try to keep your pricing competitive, but be sure you’re covering your expenses and actually making a profit.
- Setting up online accounts, like your website and ecommerce store, and if needed, tools and software to manage the business, as well as social media profiles.
5. Spread the word about your product or service
Once you’ve got everything set up, go ahead and start selling. Launch your website or online store. Then start marketing and wait for the sales to roll in.
You can also try local craft fairs or school events. With a parent’s help, get the legal stuff sorted. Then, you’re ready to handle the daily business tasks. Have fun, make extra cash, and learn skills for the future!
Your future is waiting
Future small business owners often are intimidated by all the steps needed to go from a business idea to a viable business. From startup costs to getting a business license to choosing the right business structure, there are a lot of moving parts required to get up and running.
But with ongoing research, support from a parent or guardian, and a determined attitude, the sky really is the limit. Just remember: It’s a process. Failing is part of it—so don’t be afraid to give it your best shot. You’ll find that every obstacle is an opportunity to learn and grow, and you’ll be a stronger entrepreneur because of it.
How to start a business if you’re under the age of 18 FAQ
Can you start a business as a teenager?
It’s possible to start a business as a teenager with the help of a parent or guardian. Look into business ideas that fit younger entrepreneurs, such as selling handmade crafts online, starting a blog or YouTube channel, or offering digital services like graphic design.
How do I create a business plan as a teenager?
Start by outlining your business idea, goals, and target market. Include details about your products or services, pricing strategy, and marketing plan. Seeking help from a parent or guardian can be beneficial in crafting a solid business plan.
Do I need to pay taxes if I start a business under 18?
Yes, you need to pay taxes on any income your business generates, regardless of your age. Consult with a parent or guardian to understand tax obligations and ensure you file correctly.
What is the youngest age a kid can be to own a business?
You can start a business at any age. However, you may need to seek guidance to handle things like legal requirements and finances. As you grow older, you can take on more responsibilities and manage more complex tasks.
What kind of business can kids start?
Kids and teens can start all sorts of businesses. Here are some ideas:
- Dog walking and pet sitting
- Selling handmade crafts online
- Designing and selling custom t-shirts
Parents: Make sure your child’s business ideas don’t have age restrictions. You’ll also need to handle any contracts or legal matters.