Starting your own business is a huge decision.
It’s never quite a seamless transition from working for someone to hiring people under you.
And it doesn’t happen overnight. Many first-time entrepreneurs work on their dream business as a side hustle until they feel ready enough to take the plunge.
Others choose to freelance. Freelancing gives them ample time to figure out their core competencies and strengths before they start a business.
The corona period, with all its uncertainties and the massive job loss scenario, saw a sharp rise in the number of first-time entrepreneurs.
The digital medium became a blessing for these entrepreneurs as they converted their loss into an opportunity. These first-time entrepreneurs launched businesses ranging from handmade products, delivery services, and home improvement services to a health products business.
The trend of the novice entrepreneur is catching up and is here to stay.
Who is a Novice Entrepreneur?
Technically speaking, anybody who launches a business for the first time is a novice entrepreneur.
So a novice entrepreneur essentially has no prior experience in the ownership of a business. This comes with its own set of possibilities and challenges.
It is important to note here that a novice entrepreneur should not be confused with a nascent entrepreneur who is an individual considering pursuing entrepreneurship.
So a freelancer who plans to start their own company soon and is working towards that goal would not be a novice entrepreneur. He/she becomes a novice entrepreneur only when they actually start the business.
Characteristics of a Novice Entrepreneur
1. Lack of Experience
A novice entrepreneur lacks experience in owning and running a business. Now, this can be both an advantage and a challenge.
The advantage is that he/she can sometimes see things with a fresh perspective and take risks that a seasoned entrepreneur might be hesitant to take. But, at the same time, this obvious lack of experience can land the company in trouble.
The novice entrepreneur essentially lacks the farsightedness and business aptitude that comes with experience.
A novice entrepreneur is a bundle of enthusiasm!
They are brimming with all sorts of exciting and innovative ideas for the development of their startup.
This can be a hindrance to the development of their new business, as novice entrepreneurs can get so carried away with their enthusiasm and passion that they fail to analyze situations objectively and judiciously evaluate potential risk factors.
3. Strong Need for Independence and Autonomy
To anybody starting a business for the first time, independence and autonomy are super attractive click-bait.
The novice entrepreneur often has a romanticized idea about entrepreneurship that fails to take into consideration organizational routines.
For someone switching from a professional job to starting a business, not having to report to someone every day is like a breath of fresh air.
A vast majority of people who leave their lucrative careers to develop a startup have the same motivation – they want to do something of their own and not be answerable to anyone.
The novice entrepreneur needs to understand that with freedom comes a great deal of responsibility. Now, they have a whole team working under them so there is no escape from discipline and routine.
Novice entrepreneurs are bound to be more creative than habitual entrepreneurs.
Since they have no previous experience in the practical side of running a business, they are more likely to place trust in creative ideas and approaches.
This creativity can be an asset for novice entrepreneurs. They can come up with out-of-the-box ideas and solutions while a seasoned entrepreneur might feel safer going with the tried and tested approach.
But the inability to balance creativity with practical business sense can also hamper the growth of their business.
Novice entrepreneurs tend to be over-confident about their ideas and approaches because of a lack of business experience.
This can lead to a complacent attitude which is not good for their business in the long run. Going too much by gut instinct, they tend to ignore quantitative data, case studies, and other market research findings.
6. Paranoia & Fear
This is the other extreme. Many first-time entrepreneurs suffer from irrational fear and paranoia. This can negatively affect their decision-making ability and cause damage to the business.
Transitioning from a Novice to an Expert Entrepreneur
A novice entrepreneur learns on the job.
They pick skills as they go along, and their business sense improves with time. But that doesn’t mean a first-time entrepreneur should just sit back, relax and let things happen on their own.
As a novice entrepreneur, you got to be a proactive learner. The transition from novice to expert is fraught with challenges. But with the right mindset, attitude, and action, you can ace this transformation!
An expert entrepreneur is characterized by confidence, dynamism, innovation, and a strong sixth sense for a prospective business opportunity.
One of the major differences between a novice and an expert lies in the ability to identify a prospective business opportunity and make the most of it.
Here are 10 tips to keep in mind for making the transition from a novice to an expert entrepreneur.
1. DO NOT over-rely on your instincts
We often hear that an entrepreneur must trust their instincts. Instinctive decision-making is the buzzword these days but overdoing it can be a recipe for disaster.
You got to gradually develop your decision-making skills to assess a situation well and be able to visualize the benefits and risks that come with it.
The decisions that come out of pure instinct or gut feeling may sometimes prove to be right by fluke. But that’s not quite the right way to do business.
Instinct does play a part in decision-making but it has to be backed up by evidence, logic, and business sense.
A novice entrepreneur must learn to read their instinct and intuition and be able to assess if that instinct is taking them in the right direction or not.
A good way to avoid miscalculation is to take some second opinions before making the final decision.
2. Develop your communication skills
For becoming an expert entrepreneur, developing a broad set of general skills is even more important than your profession-specific skill set.
A novice entrepreneur must constantly work on their communication skills if they want to make that transition to an expert entrepreneur.
It may sound like a small thing but the quality of your communication skills can literally make or break your business.
Effective communication would not only help you in better internal management but also in terms of taking your business forward – product development, marketing strategy, communicating with clients, attracting investors, and building long-term business relationships with various stakeholders.
3. Learn how to sell
This is the skill that many novice entrepreneurs lack. You have a great idea, and developed an awesome product or service but what’s the point if you don’t know how to sell it?
The ability to create and implement a successful sales pitch for a product is what distinguishes an expert entrepreneur from a novice. You got to learn the skill of connecting with businesses and creating a successful sales cycle.
Of course, you have an entire sales team to work on your company’s sales strategy. But as the leader of the company, you got to be savvy about selling your product or service.
A novice entrepreneur needs to constantly work on their soft skills, confidence levels, and product and marketing knowledge to develop a sales-oriented mindset.
Last but not the least, you got to be passionate about your niche. This will lead to conviction-based selling, where the entrepreneur becomes an extension of their brand.
You are so passionate about your area of expertise that it becomes a part of your personality.
4. Inculcate a learning mindset
An expert entrepreneur remains a student always.
They are constantly on a learning curve and never get complacent about what they already know. A novice entrepreneur should learn to become a life-long student if they want to make that transition.
Invest in quality courses on entrepreneurship. Attend entrepreneurial workshops and events. Never miss out on conferences and events related to your business domain. These are great opportunities to learn and network.
A lot of informal learning too happens on the go when you are running a business. You should be open to ideas and advice and learn from the experiences of more seasoned entrepreneurs.
Your own employees can be a great source of learning; listen carefully to their suggestions, ideas, and if they have some valuable insight to offer, just take it.
And most importantly, learn from your failures.
5. Tap in the benefits of networking
Developing a business is all about networking and contacts. Opportunities can come in from anywhere. So it’s important to forge valuable connections with individuals and other businesses.
You never know who will turn out to be an asset for your business when and in what way.
An expert entrepreneur knows that great people skills are crucial to running a successful business. So as a novice, you need to proactively work on expanding your network through training, endorsements, recommendations, testimonials, etc.
6. Learn to manage your finances
Managing one’s finances is a skill. You got to master the balancing act between spending enough money on your business to not going broke.
Expert entrepreneurs would always have a well-laid out long-term strategy to make their finances grow over time.
As a novice entrepreneur, financial management is a skill you got to learn if you want to move up the entrepreneurship ladder.
Sustainability is the foundation of good financial management. It’s not just about the company’s finances; you got to keep your personal finances in good shape too.
How you manage your finances is a reflection of your mindset in financial matters.
You got to constantly upgrade your learning in the basics of finance and accounting. As an entrepreneur, you should be able to hold forth a discussion on finance with investors, private equity firms, or banks.
7. Know how to hire and train people
An expert entrepreneur not only creates financial assets but also assets in terms of quality manpower. You got to master the art and science of hiring the right kind of people.
The contribution of employees to the growth of a company should never be underestimated. Therefore, it is important that you develop an aptitude for spotting the right talent, and then nurturing and retaining it.
You also need to constantly invest in training your staff.
As an entrepreneur, you got to make sure that your staff is constantly up-to-date on the latest domain knowledge and technical skills. This is very important for the growth of your business.
8. DO NOT shy away from trying out new things
An expert entrepreneur is constantly innovating and trying out new things. Obviously, this will lead to some failures. But that’s how you learn and grow.
Every successful entrepreneur has a history of unsuccessful attempts at trying out different things. We see the successful part and assume that they must be doing everything right at all times.
But the truth is they have learned from their mistakes and that’s what made them the seasoned entrepreneur they are today.
A novice entrepreneur should always be on the lookout for new ways to promote their business, innovative ways to expand their product portfolio, and try to reach a new market.
Many people who start unconventional or offbeat businesses will miserably fail at first but once they make it, there is no looking back.
9. Learn to predict future trends
This is the hallmark of an expert entrepreneur. They have the uncanny ability to predict future trends in their business domain.
This is certainly a difficult skill to acquire but with a bit of patience and trying, it’s not impossible.
Once you develop some experience in your field and have some kind of insight, you’ll be able to predict the general direction in which your area of business will be moving in the future.
The ability to predict future trends comes from a balanced mix of intuitive, creative, logical, common-sensical, and analytical skills.
Based on this ability, you’d be able to make better decisions for the future expansion and development of your business.
10. Have a Vision
Finally, to become an expert entrepreneur, it is very important to have a vision.
Vision is the driving force behind businesses; it is the vital energy that enables the transformation of a business from a small startup to a large-scale organization.
Vision is not the mere prediction of future trends but an entire visual mapping of your business in years to come – it is your dream about to how you want to see your business shape up in the future.
In that sense, vision is an abstract entity, but one that is at the core of all major business decisions of an expert entrepreneur.
You should be passionate about your niche to develop that vision. Practical business experience combined with innovative thinking about the future of your business will help you develop a vision for your business.