Interest in self-employment starts early these days. According to one study, three in five American teens are seeking programs that teach entrepreneurship in and out of school. And by the time they get to college, the number of students planning to become their own bosses increases. In fact, 60% of 2022 graduates currently run or plan to launch their own businesses, opting for the freedom, flexibility, and earning potential it can offer compared to traditional jobs. If you’re planning to start a business after graduation, you don’t need to wait until you have your diploma. Creating a plan now will help you hit the ground running right after your last final. Here are three important business prep steps to take while you’re still in college.
1. Make connections
With nearly 70% of college seniors concerned with the significant amount of student debt they’ll be graduating with, it’s smart to take advantage of all the free resources you have on campus. Faculty members may be able to offer mentorship and guidance. The career services department can also help you connect with graduates already running their own businesses—an invaluable resource if you’re planning to take a similar journey.
In addition, many colleges and universities offer student organizations like entrepreneur or business clubs where students can access resources, meet local entrepreneurs, and share ideas with like-minded individuals. Don’t ignore the power of internships either. Doing an internship in a field or market that interests you can be a valuable way to make connections and get an inside view into running a business.
Related: How to Start Networking: Top Tips and Tricks
2. Work on your business plan and seek feedback
All entrepreneurs need a business plan illustrating how their great idea can turn into a successful, profitable company. When writing your plan, you need to account for every area of your business—from marketing to manufacturing—if you plan to sell a product. Business plans are living documents that’ll develop and change alongside your company, so creating one now in college can give you a solid starting point and save you time. If you’re lucky, you may even be able to kill the proverbial two birds with one stone by developing a business idea for a class or project. Instead of doing the work just for a grade, consider it an opportunity to develop your plan, pitch or present it to people, and get feedback from professors and peers. You can use the input you receive to rework any areas of your plan that your class found lacking or highlight the areas that stood out.
Another great way to get feedback is to enter your business plan into a competition. Many organizations sponsor these opportunities for high school, college, and graduate students. Winners usually receive not only valuable feedback but seed money or a microloan to invest in their start-up costs. Even if you don’t win, the opportunity can help you test-drive your idea against others—some of which may be your actual competition after you launch your business. In addition, there are competitions for creating and delivering in-person or virtual pitches for your business, like a 90-second elevator pitch of what your company will deliver, why it’s needed, and how it stands out from others. Contests may award up to $10,000 for the best pitch presented to successful entrepreneurs. You may even be able to deliver your virtual pitch right from your dorm room.
3. Start exploring funding options
Besides maybe asking your parents to contribute to your start-up as an early graduation gift, there are many ways to fund your business while you’re still in college. These range from borrowing money from friends and relatives (consider them “investors”) to taking out a small business loan at a bank or credit union. It can be difficult for young people, especially college students or recent graduates, to obtain traditional funding. Consider how much money you’ll need for start-up costs and how much it’ll cost to pay back your loan. In addition, your credit score will impact how much lenders will give, so keep your credit in check while in college.
Another great funding resource is the Small Business Administration, which offers online courses, mentorship programs, and other resources like a lender match tool. While your business and personal budgets may be separate, knowing how much debt you’re willing and able to take on is essential. You may be tempted to use credit cards, but this can be risky, especially if you’re using your personal line of credit vs. a business card. When you’re still searching for financing, it pays to do your research before you take out a loan.
Related: 5 Ways to Prepare for Your Life as an Entrepreneur
All this to say, you don’t have to wait for graduation to start your start-up! While in college, you can utilize your campus resources, research loan options, engage with business mentors and like-minded student entrepreneurs, and begin to craft a solid business plan to help you launch a great start-up once your degree is in hand. Good luck!
You need to take advantage of everything your Business education has to offer! Check out our article on How to Make the Most of an Undergraduate Business Degree to make sure you’re on track.
