How to Start Your Own Business

By Sallie Krawcheck

When I decided to start Ellevest, it wasn’t because I woke up one morning and thought, “Today, I’m going to start a business.”  It was because I was passionate about a problem that no one else was solving: creating the financial services company that women deserve — one built by women, for women. And, I genuinely believed I had what it took to solve it — or could get access to the resources — including my experience in the financial industry. I also had the ability to fully commit myself to getting Ellevest off the ground.

Devotion, drive, determination; all women entrepreneurs (and aspiring business owners) have ‘em. But actually figuring out how to start your own business can be tricky. Do you just quit your job because you’re obsessed with your idea? Is this your new life now? The quick answer is almost always: no.

Regardless of your position, you need a game plan. Because there’s a lot to consider before you officially make the leap. Which is why the lessons I’ve learned on my journey from corporate executive to Ellevest CEO — and from the trade-offs I’ve made — can give you a glimpse into what’s ahead so when you’re ready, you’ll know you’re ready.

Here are 7 tips for woman entrepreneurs who want to start a business (including all the ways Ellevest can help you):

1. Don’t quit your day job … yet.

Entrepreneurship is hard, and it’s not for everyone. Do your research, and dip your toes in before quitting your job entirely. A simple Google search can tell you what competition you'll be facing for your idea. You can also search patents and trademarks to see if your idea has already been registered. Talk to people you know — and people you don’t know — about your idea and get their feedback.

Consider setting up shop on the side. Pick up a few freelance or consulting gigs with start-ups. Advise a start-up for a while, to get a feel for it. If you’re more of an artisan, start selling your products on Etsy, for example. This will help you see if you really have a money-making idea.

Lastly, know that work-life balance will change when you start a business — PTO goes OOO for the foreseeable future. You’ll have to vibe with this inevitable new grind, so if / while you still have paid sick days from your current employer, monitor your capacity for being always-on along with your ability to avoid burnout. 

A little housekeeping can help you find a sustainable groove. Have conversations with your family and friends about how this entrepreneurial career path will change your routines, priorities, and availability. While you ask for their support, actively listen to their non-negotiable needs. Communication was crucial as I navigated how to manage being an entrepreneur and a mom.

2. Network.

You cannot, cannot, cannot start a business alone. The strength of an entrepreneur's network can really make or break her business. Ask yourself who you know, and who you would like to know. Don’t be shy about calling on your friends, colleagues, and family for any help they can offer — whether it's giving you feedback or connecting you with potential clients or resources. 

Be generous and do the same for other women entrepreneurs. We’ll go first: bookmark the Ellevest #DisruptMoney Resource Guide.

3. Bulk up your savings.

Even if you believe you have a million-dollar idea, it's likely going to take a while before you actually turn it into one. Most experts say you need to give your new business two years to see if it can work. So before you go all-in and leave your day job behind, be sure you can support yourself along the way with adequate savings for the short term

Next, tick off all three of these financial to-dos for new and aspiring business owners, and set your finances up for success.

Finally, one of the most impactful-yet-overlooked savings strategies for entrepreneurs:  invest in starting your own business. 

Ellevest’s investing platform includes a Start a Business goal, one of many Ellevest investing goals that gives clients specific recommendations for how much to invest, and for how long, so they have the best chance to hit specific money goals. Our entrepreneurial-focused investing goal helps clients build an appropriate financial cushion while they build up their business. 

How cush is that cushion? We recommend having two years' worth of your current take-home pay saved up. Our Start a Business investing goal defaults to getting you there over the next five years. If you're starting out by freelancing instead of diving directly into starting your own business, you may be able to get started with less saved. But it's better to save too much than to risk not having enough to give your business a chance to work.

And speaking of savings, now that you’re the boss of you, get that SEP IRA going.

4. Write down your plans.

Remember the old adage, “If it’s not on paper, it doesn’t exist?” Well, it’s especially true when you start your own business. Get your plans on paper … or onto your computer. Even a few pages will help you get organized, focus your ideas, and get you on track.

Some things you may want to include in your business plan: your mission statement, target audience, revenue streams, marketing and distribution channels, partnerships , and, of course, financials. Keeping it brief will make it easy to adjust as things progress and change (and, believe me, things always change).

As you outline everything, it's a good time to recognize that you’ll be responsible for all of it. If you're uncertain about any portion of the work, figure out now how to get around that. For example, if you aren't great with bookkeeping, do you know someone who is? Give her a call. Get advice or consider having someone do it for you — and work hiring employees and freelancers into your plan (psst … it’s never too early to ask how you’ll help those future employees save for retirement).

5. Get funding.

Even as women are starting businesses at a greater rate than men, we still don’t receive anywhere near our fair share of funding.

But things are starting to change. First of all, hi! Ellevest was created to help close the gender investing gap. To support women starting their own companies, we get real about what it takes to fund your business so you feel confident in your financial future.

  • Funding tip 4: Pick your investors carefully. Reality check: You can’t fire an investor, so make sure your business vision and risk appetites are compatible, among other crucial factors.

  • Funding tip 5: Yep, we know you're about to start your own business, but what do you know about exits? It’s worth being aware of the do’s and don’ts way early so you’re not in a bind later.

6. Organize your paperwork.

There is a lot of red tape involved when you start a business. You need to select your form of ownership, register a name, get a tax identification number and whatever permits or licenses you'll need — to name just a few things. Check with the US Small Business Administration for guidance with these important details.

7. Become a certified woman-owned business.

Once you’re up and running for a few months, give yourself a pat on the back. Next up: Register as a woman-owned business. Doing so can help you land big clients, including in local and federal governments, as well as large corporations, that aim to parcel out a certain amount of contracts to women entrepreneurs and women-owned businesses.

The certification process is a lot of paperwork and can take up to 90 days. You need to provide a ton of documentation for review and prove that your company is at least 51% owned and managed by women. See the National Association of Women Business Owners for more details and other resources on getting certified.

Looking for more financial guidance on how to start your own business? Connect with an Ellevest financial planner today to reach your entrepreneurial money goals.

Sallie Krawcheck Signature


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Sallie Krawcheck

Sallie Krawcheck is the Founder & CEO of Ellevest.