How to Become an Entrepreneur: 7 Steps + Skills (2025)

Becoming your own boss is a dream for many. The creative control, flexible hours, and freedom that come with entrepreneurship are all part of the appeal.

But launching a business and becoming an entrepreneur takes more than an idea; it requires planning, strategy, and dedicated execution. If you’ve always wanted to start a business but haven’t taken the leap, this guide is for you.

You’ll learn how to become an entrepreneur in seven steps—from validating a business idea to launching and managing your business. You’ll also find resources to build an entrepreneur mindset and the skills to succeed in 2025 and beyond.

How to become an entrepreneur: Your 7-step roadmap

1. Find a profitable business idea
2. Develop a product or service
3. Validate your product with an MVP
4. Write your business plan
5. Secure funding
6. Launch your business
7. Manage the business

1. Find a profitable business idea

The product category you choose is at the core of your business and one of the most important decisions you’ll make.

While there’s no such thing as a “perfect" product, you can minimize risk by choosing a niche with strong market potential. Use the criteria below to weigh the pros and cons of your idea and improve your overall chances of success.

Does your product or service serve a passion or solve a problem?

It’s always an advantage to sell products that serve a passion or solve a problem. Products that solve a clear need often require less marketing effort. Instead of pushing your product to uninterested audiences, you’re meeting new customers already searching for a solution.

Is this a trend, fad, or growing product category?

Fads rise quickly and disappear just as fast. Trends last longer and can evolve into long term growth. Stable markets offer predictability, while growing markets signal lasting shifts in consumer behavior. Understanding where your product and niche lie can play a huge role in your success or failure.

To better understand the differences, here are some real world examples:

• Fad: Fidget spinners surged in 2017 and faded overnight. Fads can be profitable if you time them right, but they’re hard to predict and risky.
• Trend: While trending products don’t grow or fade as quickly as fads, they can still be difficult to predict. Skin care, which accounts for 44% of the global beauty market, has grown steadily over the past decade and shows no signs of slowing down.
• Stable: A stable market is neither declining nor growing but maintains itself over long periods of time. For instance, teapots have held steady demand for more than 15 years.
• Growing: A growing market shows steady growth and signals a lasting shift in consumer behavior. For instance, the athleisure market is projected to reach $450 billion by 2028. 

What does the competitive landscape look like?

What does the competitive landscape look like for your selected product and niche? Are you first to market? Are there already a few competitors, or is the market saturated with people selling the same product or targeting the same niche?

Before entering a market, consider how much competition exists and what that means for your product:

• No competitors: Do thorough market research to make sure there’s real demand. Being first can be risky if the market doesn’t yet exist.
• A few competitors: This often signals early validation. If others are seeing some success, it’s a good sign of a growing niche.
• Many competitors: The market is clearly validated, but standing out will be tougher. You’ll need a clear differentiator to make your brand and product memorable.

Brainstorming techniques for business ideas

Not sure where to start? These simple exercises can help you uncover business ideas grounded in real demand:

• Mind mapping: Explore connections between interests, skills, and industries.
• Problem journal: Track your daily frustrations and think of ways to solve them.
• Customer pain point analysis: Look at product reviews, forums, or social media to spot unmet needs.

2. Develop a product or service

Once you decide what you’ll sell, there are several options for product development. You can make your own products yourself, like the artisans at Heath Ceramics. Or you can find a manufacturing partner who will develop your product idea to your specifications, similar to how the team at West Path sources its Mexican blankets.

Another option is to purchase wholesale products directly from independent brands. This lets you buy ready-to-sell merchandise in bulk to resell on the retail market. 

Shopify has partnered with Faire, the leading online wholesale platform, to simplify sourcing. The Faire: Buy Wholesale app syncs directly with your Shopify admin, making it easy to add curated products from around the world to your catalog.

If you’d rather avoid inventory, consider dropshipping. With this model, you only buy a product from a third-party supplier once a customer places an order. The third party then ships the item directly to the customer, so you never have to handle inventory or fulfillment. Shopify supports dropshipping through integrations, making it easy to connect with suppliers and automate orders.

If you create your own designs for t-shirts, art prints, mugs, etc., you can also offer printing on demand. With this model, a supplier prints your designs on white-labeled items only after a customer places an order. Like dropshipping, you don’t need to store inventory or handle shipping—products are made and shipped as needed. 

3. Validate your product with an MVP

When you’re starting a new business, validating your product idea early helps reduce risk. It’s how you confirm you’re selling products that customers really want, before you invest significant time or money. Real product validation happens when people buy, so your goal is to get those first few sales. 

Start small with a minimum viable product (MVP). This lets you test demand, gather feedback and satisfy early customers before scaling.

Spend some time performing buyer persona research. When you understand your target market it’s easier to tailor your product, messaging, and marketing strategy.

You can build a coming soon page to drum up excitement. Or set up pre-orders to gauge interest. The owners of Jaswant’s Kitchen, a shop that sells natural Indian spices and cooking kits, validated their products by selling at in-person shows before launching online.

Once you make a few sales, you’ll be in a stronger position to refine and scale your business.

4. Write your business plan

Once you’ve validated your product idea, it’s time to put together a solid business plan. This document outlines your business strategy and helps you stay focused as you grow. Your plan may include:

• Who your target customers are
• Your business model and how it will make money
• What you’ll charge for each product
• The product lines you’ll launch with
• Your marketing strategy

Think of it as a road map. Not only will it guide your next steps, it can also help attract funding partners or team members. Use our free business plan template to get started. 

Choosing your business structure

Your business structure affects everything from taxes to personal liability. The IRS uses it to determine the type of income tax return form you need to file. 

Here are the most common options:

• Sole proprietorship: Easiest to set up, but you’re personally responsible for any business debts or legal issues.
• LLC (limited liability company): Offers personal liability protection and flexible tax options. Great for solo entrepreneurs or small teams.
• Corporation (C Corp or S Corp): Offers strong liability protection and works well for companies raising investment, but comes with more paperwork and separate taxation.

LLC vs. Corporation: How to choose

• Choose an LLC if you want simplicity, liability protection, and protection without the complexity of incorporation.
• Choose a corporation if you plan to raise venture capital, offer employee stock options, or reinvest profits at scale.

You can always switch structures later, but picking the right one early can save time and money down the road.

Finding the right co-founder

Having a co-founder can bring balance, support, and complementary skills to your business, but it’s not the right move for everyone.

Pros of having a co-founder:

• Shares the workload and emotional highs/lows
• Brings different perspectives or industry knowledge
• Helps validate decisions and challenge ideas

Cons:

• Disagreements can slow progress
• You’ll need to split equity and decision-making
• A poor fit can hurt your business long-term

Where to find a co-founder:

• Tap into your existing network (friends, former colleagues, classmates)
• Attend startup events, hackathons, or industry meetups
• Use founder matchmaking platforms like CoFoundersLab or Y Combinator’s Startup School forum

How to vet a potential co-founder:

Ask tough but important questions:

• What are your long-term goals for this business?
• How do you handle stress and conflict?
• How much time and money are you willing to invest?
• What are your strengths and weaknesses?
• How do you make decisions under pressure?

Even if you trust each other, don’t skip the paperwork. Create a founder agreement that covers roles, equity split, decision-making, exit plans, and how to handle disagreements. It’ll protect your business and your relationship.

5. Secure funding

Launching a successful business often costs money, especially if you’re creating and selling your own products. While you can reinvest early profits, most entrepreneurs need funding to get started and sustain operations.

Whether you’re starting your own business from scratch or buying a franchise, there are two broad types of funding: traditional and alternative.

Traditional funding options

These sources of capital typically come from banks, investors, or government-backed programs. These require a more formal application or vetting process.

Small business loans

Loans from banks, credit unions, or online lenders can cover startup costs like inventory, manufacturing, and marketing.

• Shopify Capital offers $200 and $2 million to eligible merchants, based on store performance.
• Other online lenders, like Fundbox and Bluevine, offer flexible lines of credit or short-term loans ideal for newer businesses.

Typical range: $5,000 to $250,000, depending on your credit profile and business revenue.

Venture capital or angel investors

If you’re building a high-growth business, venture capital may be the right fit. Venture capital firms and angel investors provide funding in exchange for equity or convertible debt (a loan that may later be converted into shares).

• Platforms like AngelList, Crunchbase, and Seed Invest help you connect with early-stage investors.
• VCs look for market opportunity, a strong team, and a path to scale or exit.

If your company qualifies, you may also be able to solicit venture capital from early-stage funds or accelerators looking to back promising founders.

Typical range: $100,000 to more than $2 million for seed-stage startups.

Alternative funding sources

Not every entrepreneur qualifies for traditional funding or wants to give up equity. These alternative options are ideal for bootstrapping or validating your idea.

Self-funding (bootstrapping)

If you have personal assets or savings, you can finance the business with your own money. This gives you full control over decisions and equity, but also means you’re taking on all the risk.

• Cover key expenses like inventory, tools, and marketing.
• Some founders borrow from friends or family; just document expectations and repayment terms clearly to protect the relationship.

Keep in mind that some businesses become profitable quickly, but others may take a year or more to generate a return.

Typical range: $1,000 to $10,000 to launch a lean ecommerce business

Crowdfunding

Crowdfunding is a great way to validate your minimum viable product, build an audience, and secure funds without giving up equity.

• Raise money from future new customers on platforms like Kickstarter, Indiegogo, or GoFundMe.
• Successful campaigns usually include a compelling story, strong visuals, and a clear packaging and marketing strategy with rewards or perks.

Learn more:How To Write an Elevator Pitch (+ 3 Free Templates)

6. Launch your new business

Don’t overthink it. Becoming an entrepreneur starts with taking action. Focus on getting your store live and your basics in place.

• Use a store launch checklist to stay organized.
• Prep your launch day marketing, like scheduling social posts in advance.
• Set up a simple way for customers to contact you in case they need help.

Once you’re live, focus on making your first sales. You don’t need to launch with everything perfect; just enough to start building momentum and learning what works.

7. Manage the business

You’ll learn more by running your business than any classroom could teach. But the best entrepreneurs never stop learning.

Invest time in expanding your knowledge—it’ll help you avoid costly mistakes and find smarter ways to grow. You can:

• Work with a mentor 
• Read business books
• Take courses
• Listen to business podcasts
• Subscribe to entrepreneur newsletters 

Challenges of becoming an entrepreneur

Starting your own business is rewarding, but it’s not without challenges. According to the US Bureau of Labor Statistics, about one in five new businesses fail within the first year, and about half don’t make it past five years. The most common reasons include cash flow issues, lack of market demand, and poor planning.

In the early days, you’ll likely wear many hats: CEO, accountant, customer support, and marketing team, all at once. That can be energizing, but it’s also a fast track to burnout if you’re not careful.

Here are a few common challenges new entrepreneurs face and how to navigate them:

• Overspending too early can drain your cash flow: Start lean using low-overhead models like dropshipping or print-on-demand if you’re tight on cash.
• Fear of failure can stop you before you start: It’s natural to worry about what could go wrong. Set small, achievable goals and view early mistakes as learning opportunities, not dead ends.
• Entering a saturated market without a unique angle makes it hard to stand out: Focus on a niche. Differentiate your brand through a strong value proposition or better customer service.
• Wearing all the hats can lead to burnout: Many founders struggle to “switch off,” especially when the line between life and business gets blurry. Set clear work hours and create boundaries early, even if you’re working from home. Take care of your mental health and make time for self-care.
• Thinking you’re too young or too old is a myth. According to research, the average age of a successful startup founder is 45, and 60% have prior experience in their industry.

Many successful entrepreneurs started right where you are now: uncertain but willing to learn. The key is to approach each challenge with curiosity and persistence, and to build smart, not just hard.

Key features of an entrepreneurial mindset

Successful entrepreneurs don’t just have good ideas—they approach problems with a mindset that helps them adapt, persist, and grow. 

Here are a few key traits that help them thrive:

• Resilience: Setbacks are inevitable. Entrepreneurs bounce back, learn from failure, and keep moving forward. Treat every failure as feedback and use it to improve your next decision.
• Resourcefulness: Entrepreneurs work with what they have. Whether it’s limited time, money, or support, they get creative and find solutions others might overlook.
• Curiosity: Successful founders stay curious. They test ideas, ask questions, and explore what their customers actually want.
• Confidence: You can build confidence by taking small, smart risks, like launching a simple version of your product and iterating based on feedback.
• Adaptability: Markets shift. Customer needs change. Entrepreneurs pivot when needed instead of giving up.

These traits are closely tied to practical entrepreneur skills like decision making, problem solving, and strategic thinking. You don’t need to master them all at once—the entrepreneur mindset is something you build as you go.

Where to find entrepreneurial support

The world of entrepreneurship can be tough. But there are resources and groups available to you to get the help, tools, and advice you need.

Resources

• Shopify: Access free entrepreneur resources, including courses and video resources, you can use to build your skills and knowledge to reach your goals.
• Small Business Administration (SBA): Get information and resources to help start your small business. You can also find SBA-guaranteed loans.
• SCORE: Get matched with a mentor through SCORE’s free network of successful entrepreneurs.
• Small Business Development Centers (SBDCs): Tap into free consulting and training at local centers.
• Small Business and Self-Employed Tax Center (IRS): Stay compliant with the latest tax news and forms for your business.
• FindLaw Small Business Center: Find legal forms, get answers to legal questions, and find small business lawyers on this site.
• International Franchise Association: Entrepreneurs don’t always start a business from scratch. The International Franchise Association (IFA) helps you find franchises for sale.
• SeedInvest: Connect with angel investors through this equity crowdfunding platform.

Groups

• Entrepreneurs’ Organization (EO): A global peer network with more than 14,000 entrepreneurs and leaders offering mentorship and networking opportunities.
• Vistage: Founded in 1957, Vistage is a mentoring membership program for CEOs and business owners. It has more than 24,000 members globally and offers coaching and peer advisory services to entrepreneurs.
• Startup Grind: A global community that hosts many events, talks and networking opportunities, bringing over 3.5 million entrepreneurs together.
• Young Entrepreneur Council (YEC): This group offers support from vetted entrepreneurs under 45 focused on growth and peer support. While it has tight restrictions to get into the community, it’s a good place to network and find potential business partners.
• International Council for Small Business (ICSB): The ICSB brings together entrepreneurs, educators, researchers, and practitioners from around the world to share insights through programs, workshops, and advocacy.

Networking and mentorship strategies

Surrounding yourself with the right people can accelerate your growth and help you avoid mistakes. Networking and mentorship aren’t just about who you know, they’re about who you learn from.

Start with these strategies:

• Attend local startup communities and meetups: Look for small business expos, chamber of commerce events, masterminds, or startup networking nights in your area. In-person connections can lead to long-term support.
• Join online communities: Participate in LinkedIn groups, Reddit forums (like r/startups), or Facebook groups (e.g., Shopify Entrepreneurs) to ask questions, share progress, and get feedback.
• Find a mentor: Use platforms like SCORE (free), GrowthMentor, or LinkedIn to connect with experienced founders who can offer advice and perspective.
• Offer value first: Great networking isn’t about pitching, it’s about building relationships. Share your expertise, ask thoughtful questions, support others, and be generous with your time.

Learning from others’ wins and mistakes can save you years of trial and error and may lead to opportunities or partnerships you never expected.

Becoming the best business owner you can be

Starting a business is not easy. Growing it is even harder. You may feel like you’re not ready to own a business, but if you’ve made it this far, you’re more prepared than you think. 

It all starts with an idea, one that you are connected with and passionate about. If you can turn that idea into something that solves real-world problems, you’re on your way to becoming a successful entrepreneur.