I’ve always been interested in business.
When I was 12, I started making and selling custom T-shirts, bracelets and soap, which I mostly sold to my relatives. A couple years later, my dad bought me some business books and I read them all. At that moment, I knew that I would like to start my own business. The only problem was — I didn’t have a business idea nor any money saved up.
Below, I describe my journey through one of my first business ideas. At the time, I was 15 and still at school. I had several ups and downs. Nevertheless, it was an exciting time for me and I learned many new skills on the way + made some good money for a teenager. I hope this article can inspire you or someone that you know who wants to start a business. If I could do it at the age of 15, then you should be able too.
Coming up with a business idea
After reading the books my dad bought me, I started thinking of different business ideas. I brainstormed for about a week. My conclusion was that I want the business to be scalable. So, I decided to open an online store, but I still had no idea what to sell there.
The logical next step was to think of what skills or interests do I have, which I could use for the business. At the time, one of my hobbies was learning magic tricks. I thought it might be interesting to start an online magic shop, so I gave it a go.
Looking back, I didn’t put too much thought into the business idea. I simply went with the first one I had. Now, I would probably think more and consider things like:
- Do I have the necessary resources to execute the idea? If not, can I get them?
- How quickly can I execute the idea?
- Can I make any money from the idea and how?
- Is this a good idea right now?
- Is this business idea something that is interesting to me? — important to stay motivated along the way!
Creating a business plan
Once I had a business idea, I went to my dad to ask for some money. He didn’t give me the money, but asked to prepare a business plan . I had never created a business plan before, but after some quick research, I made a simple document, that was not longer than 10 pages. It mainly focused on the tasks that I needed to complete to open the online store. Some of the tasks included:
- Determine what products I will sell
- Determine how much mark-up I should add
- Build a website
- Host the website + buy a domain name
- Find a wholesaler
- Buy an inventory or explore drop shipping options
- Incorporate a company — not possible at the age of 15, so need to find an alternative way
- Decide how I will market my business
- Determine the budget to complete all the tasks above
If you are planning to start your own business, I suggest you to write a business plan too. It doesn’t need to be a very detailed one. The main purpose of writing a business plan is to define a step-by-step plan for yourself so you can achieve your goals. It helps you to organise your thoughts and allows you to identify any areas where you may need external assistance. It should also include a budget that shows how much money you need to launch and run your business. Lastly, you should estimate how much profit you can make and if you can sustain the business in the future.
First tasks completed
Once the business plan was ready, I started working on the tasks that didn’t cost me any money. First, I found a programmer, that promised me to build a simple online store for $100 (this was in 2007). He asked for 50% prepayment and 50% after the work is completed. Then, I contacted several wholesalers around the world and found couple that I liked. They sent me their price lists and I started calculating how much the products will cost me (with shipping and import duties) and what price I could charge for them in my online store. Unfortunately, those wholesalers did not offer dropshipping and required 100% prepayment for new customers. This meant that I needed a larger start-up capital to begin with.
At this point, I realized that I don’t have enough money to start the business on my own. I consulted with my dad and he said that he could provide me 50% of the money, but I would need to find the other 50% somewhere else. So I started looking for a business partner.
Finding a business partner and launching the business
Where would you find a business partner at the age of 15? My options were other relatives and my friends. I decided to partner up with a good friend of mine, who was also interested in magic tricks. We presented our business plan to his parents and they decided to give us the remaining 50% of the money.
Over the next couple of months, we created the website, bought some small inventory, purchased a domain name and launched our online store. Everything was good up until then, but we forgot about one thing — sales! We actually had no plan set out how and to whom we will sell our products. To deal with the traffic and sales problem, we tried to market the online store to our friends, on social media and locally in our city. We managed to sell few products and then decided to make our business legitimate and create a legal entity (on our parents’ names).
The first big problem
Originally, we both had agreed on 70/30 share split once we set up a company. I would get 70% of the business since I did more of the prep work and also took on more responsibilities going forward. My friend was OK with that and we started building the business. However, at the moment of setting up the company, my friend’s parents insisted on having a 50/50 split. They convinced my friend that we should have equal shares, without knowing about our original agreement and the split of our responsibilities. Being only 15 years old, my friend took his parents advice and gave me an ultimatum — 50/50 or no business. We kept talking for hours, but in the end couldn’t agree on anything.
The last sentence that he said — I am creating a new store by myself!
Because of this argument, I lost contact with my best friend for several years. It was one of my first negotiations and I decided to stick to our original agreement instead of reaching a compromise. At that point, I really felt that’s the right thing to do. We both didn’t know how to deal with this kind of situation and ended it in a bad way that damaged our friendship forever.
If you ever come to a similar situation, try to consider the following things:
- If you value a friendship, don’t allow it to wane, as the result of a bad negotiation.
- Sometimes it can be very difficult to mix business with friendship. If you sense some difficulties in a friendship, as the result of a pending negotiation, set the boundaries firmly before the negotiation.
- Monitor the temperature of the negotiation. When a negotiation with friends start to “heat up”, seek ways to “lower the temperature” or postpone the negotiation to another day.
Starting from zero?
Now I was on my own, without a business partner and no plan of what to do next. The online magic shop was not doing well and I was starting to think about pursuing other business ideas. Needless to say, I was very disappointed. Meanwhile, my best friend was setting up another online magic shop…
A big turnaround point was a magician meetup where I participated couple months later. My idea was to find someone like-minded, who might want to join my business idea. The meetup ended quite different than I expected. I met the organisers of the event, who were two professional magicians touring the world. When I mentioned my business idea, they explained to me that they always wanted to open a local magic shop, but didn’t have enough time to pursue the idea. I didn’t hesitate and told them — let’s do it together!
Partnering with these two magicians was a very good idea. I could learn a lot about the industry and we could grow the business a lot faster. They knew more wholesalers, best products to sell and had many ideas how to market the business. I didn’t have to worry about setting up a legal entity, as they already had one that we could use. In addition, they could provide money to build the business, which I didn’t have at the time.
Christmas was only two months away, so we set ourselves a goal — to open the store in a local shopping mall just before Christmas.
Success — the opening of our store
In the beginning of December 2007, we opened our magic shop. It was the holiday season and we sold out our inventory much faster than expected. We also started producing our own products — DVDs with instructions and our own magic tricks. Our peak sales over the Christmas holidays reached over $800 a day. It was exciting, and I thought we were going to keep on growing forever.
But after the Christmas rush was over, sales plunged. And then the Financial Crisis of 2008 hit. Talk about a shot of cold reality. Not many people wanted to buy magic tricks and over the next 12 months we barely made a profit. The store required a lot of our time, but did not produce enough money for all of us to stay motivated. That’s when I decided to exit the business and put my business enterprise(s) on hold and go to university. My business partners kept running the business for a while, but nothing really changed and they eventually closed it.
Was it worth it?
In my opinion, starting a business as a teenager is definitely worth it. Starting early gives you an advantage that will make a big difference. You can try ideas that won’t generate millions, but you would learn a whole lot about entrepreneurship, and get yourself ready for challenges that may come in the future.
You also learn to deal with failure, which is part of the process. You may not be successful with your first or second try and many things may not work out according to your plan. The key to overcoming your failures is to never stay down. Always learn from your experiences and keep moving forward.
Consistency will help you to succeed.
Key takeaways from starting a business early
✓ Just get started, this is how you will learn. It is never too early for you to start a business and become an entrepreneur.
✓ Have a business plan. It will help you to define a step-by-step plan and organise your thoughts.
✓ Be persistent! Very likely, you’re not immediately going to succeed.
✓ Pretty much all ideas at the beginning are bad ideas, it’s only through testing that you get to a good idea.
✓ Failure is part of the process. It’s better to learn early when the stakes are small.
✓ Don’t be shy about reaching out to others. There is only so much you can do alone.
✓ Starting a business is fun. Seeing a project from start to finish gives you a sense of accomplishment.
✓ Build your confidence! When you create a plan, start a business, face many problems along the way and solve them, you are not only building your business, but also your confidence.
✓ Learn money management skills. Understanding how money works is one of the most important life lessons to learn. The sooner you do it, the better.
This article is for informational purposes only, it should not be considered Financial or Legal Advice. Not all information will be accurate. Consult a financial professional before making any major financial decisions