How to Start a Business as a Teenager (And Keep Up With School)

The world of entrepreneurship is no longer just an adult's game:

Anyone can make significant strides in business!

This “How to Start a Business as a Teenager” guide is crafted to empower young minds like you to turn entrepreneurial dreams into reality.

Whether it's a tech startup, a creative venture, or a social project, I’ll  walk you through the essential steps.

Navigate legal requirements, develop your business idea, manage your finances, and more.

Laying the legal groundwork — doing things the right way!

Embarking on your entrepreneurial journey as a high school student is exciting:

And you're truly never too young to get started.

At ae 13, Hart Main started a business selling "manly" scented candles to buy a bicycle — today, the candles can be found in almost 150 stores across the country!

But, this said:

It's vital to start on solid legal ground.

So, first, we have to start with slightly less exciting things.

This isn't just to comply with regulations but also to protect your ideas and hard work.

(In business, there are many sharks in the water. Nobody will go easy on you just because you're young!)

So first, be aware of the legal age for conducting business in your country or state.

While creativity knows no age, legal contracts and agreements often do.

As a minor, you might face limitations in:

• Signing contracts
• Opening bank accounts for your business
• Or taking on certain types of liabilities

In most cases, having a parent or guardian involved is not only helpful but also a legal necessity.

They can help navigate areas where your age might be a constraint.

This might mean having them co-sign agreements or assist in setting up the legal structure of your business.

(It may also involve convincing them that your business won't interfere with your school work, but I’ll get into detail about this later.)

Set up a legal business entity

Whether you want to know how to start a business as a teenager online, or are just looking to set up a local hairstyling business — choosing the proper business structure is crucial.

Whether it's a sole proprietorship, a partnership, or a limited liability company (LLC), each has its advantages and requirements.

Read more: Learn about the different business entities on our blog.

Understand what each entity entails and how it affects your taxes, liability, and business operations.

However, as a teenager, a sole proprietorship is probably the best start!

All small business owners know — it's also the most accessible.

Navigate online business laws

If your business operates online, it's essential to understand the specific laws that apply, such as:

• Data privacy
• Consumer protection
• E-commerce regulations

Compliance with these laws is critical for your business's reputation and legal well-being.

You'll be able to find some great YouTube videos on this — a quick search shows me this:

Intellectual property rights

As a young entrepreneur, your ideas and innovations are your most valuable assets.

Learn about intellectual property (IP) rights, including how to protect your business name or logo.

At the end of the day, you want what's yours to remain yours.

And the only way to do that is through proper legal protection.

Tax obligations and financial reporting

Managing taxes might not be the most exciting part of entrepreneurship, but it's unquestionably essential.

Familiarize yourself with the tax obligations specific to your business structure and the importance of maintaining accurate financial records.

You may want to speak to your parents or other close family members who can advise you on this more.

But if you're just starting out and haven't formally registered your business, you don't have to worry about this now.

Obtain the necessary permits and licenses

Specific permits and licenses might be required depending on the nature of your business.

This could range from a basic business license to specific product or service permits.

Research and obtain all necessary legal documents before you commence business operations.

How to start a business as a teenager — from idea to reality

"The journey of a thousand miles begins with a single step." - Lao Tzu

And in the world of entrepreneurship, those steps are your business ideas.

But remember:

Winning business ideas aren't just about making money—they combine your passions, skills, and a keen understanding of the market's needs.

So:

What are you passionate about? What skills do you possess?

Remember, the most successful businesses often stem from a personal interest or hobby.

Consider what excites you – technology, art, fashion, or social issues.

Market research — some practicalities

Now, let's get practical.

Your idea should excite you and have a place in the market.

This is where market research comes in.

(You may have already learned about this economics class.)

Look into who would buy your product or service.

Are they:

• Teenagers,
• Busy professionals,
• Parents,
• Gamers,
• Or someone else?

Conduct surveys, do online research, or even ask people in informal conversations to understand your potential customers.

Here's a tip:

If you haven't already, think about the problems you encounter in your daily life.

Is there a gadget that could make homework more manageable? A service that could bring together young artists?

The best businesses come from solving real problems or filling gaps in the market.

Validating your idea

It's time to test the waters.

Share your ideas with friends, family, and teachers.

Listen to their feedback.

You can even create a basic version of your product or a small-scale version of your service – your minimum viable product (MVP).

Do you have plans to grow?

Did you know that Fred DeLuca founded his first Subway restaurant at 17?

As a young entrepreneur, think big.

Your business might start locally, but it can grow.

Consider how your idea might be expanded or adapted over time.

Could your local lawn mowing service become a regional landscaping business?

At this age, you can afford to take some risks!

Learn from your competition

Who else is doing something similar?

Learn from them.

What can you offer that they don't?

This is your chance to differentiate your business.

Remember, competition is healthy; it keeps you motivated and innovative.

It's time to get pen to paper — your business plan

Every successful business begins with a well-thought-out business plan.

Business plans help you:

• Clarify your business idea
• Set goals
• Outline strategies to achieve them.

A good business plan is a living document that evolves as your business grows.

So, where do you start?

Let's look at the key components you'll have to put together to have a fully-fledged business plan:

• Executive summary:

This is an overview of your business idea, including your mission statement, the product or service you offer, and basic information about your company, such as its location.

Despite being the first section, it's often written last, as a summary at the end.

• Company description:

Detailed information about your business.

Discuss what you do, whom you serve, and what makes your business unique.

• Market analysis:

This section requires you to research your industry, market, and competitors.

Include details about your target market – their needs, preferences, demographics, and how your business will fulfill those needs.

• Products or services:

Elaborate on what you're selling or the service you're offering.

Explain how they will benefit your customers.

• Marketing and sales strategy:

Outline how you plan to attract and retain customers.

This includes your marketing strategies, sales plans, and the overall sales process.

• Funding request:

If you're seeking funding, specify the amount needed over the next five years and how you plan to use it.

Include future financial plans as well.

Tips for writing a business plan

• Be clear and concise.
• Understand that your business plan is a work in progress; you can (and should) update it as your business evolves.
• Use graphs, charts, and images to break up text and convey data visually.
• Seek feedback from elders, mentors, friends, and family.

Master the money game

As a teenage entrepreneur, diving into business finances might seem daunting, but it's essential for your venture's success.

Let's start with the basics:

Financial literacy is simply about understanding how money works in your business.

This means:

• Knowing how to budget.
• Understanding how much you're spending versus how much you're earning.
• Ensuring your business is financially viable in the long term.

Budget and track expenses

Firstly, let's talk about budgeting.

A budget is a plan for how you expect to spend and earn money over a certain period.

Start by listing your expected income (from sales or services) and expenses (such as supplies, marketing costs, and any fees).

Keep track of all your business transactions, no matter how small.

Plenty of apps and software can help you with this, or you can use a simple spreadsheet.

Open a business bank account

It's essential to separate your business and personal finances.

This starts with opening a business bank account.

This makes tracking your business finances easier and gives your business a more professional appearance when dealing with customers or vendors.

Understand bookkeeping

Bookkeeping involves recording all of your business transactions.

This includes every payment you receive and every expense you pay.

Good bookkeeping is crucial because it helps you understand the financial state of your business at any given time.

Financial statements and their importance

There are three primary financial statements you should be familiar with:

• The income statement
• The balance sheet
• The cash flow statement

These documents provide an overview of your business's financial health.

You don't need to be an accounting expert, but understanding the basics of these statements is crucial.

Build your support system

As a teenage entrepreneur, a robust support system is one of your most invaluable resources.

This network, composed of mentors, peers, and industry connections, can provide guidance, share valuable insights, and open doors to new opportunities.

Mentors are vital, and even game-changing sometimes

Mentors can be game-changers as they offer wisdom gained from experience, helping you navigate challenges and make informed decisions. To find mentors:

• Identify potential mentors: Look for individuals who have succeeded in your area of interest. This could be a local business owner, a teacher, or an online entrepreneur.
• Get in contact: Reach out via email or social media. Be clear about why you admire them and what you hope to learn. But make sure not to reach out to just anyone — ensure that you can guarantee that they're legitimate and safe to contact.
• Foster the relationship: Respect their time once a mentor agrees to help. Come prepared with specific questions or challenges you're facing.

Building a peer network

Your peers – fellow young entrepreneurs and even classmates – are also vital to your support system.

They're likely facing similar challenges, so sharing experiences can be incredibly beneficial:

• Join or start a club: Consider joining or creating an entrepreneurship club at your school or community.
• Attend youth business events: Look for workshops, competitions, or meetups for young entrepreneurs.
• Stay engaged: Keep the communication open. Regular meet-ups, even virtual ones, can help sustain these relationships.

You can use your social media for business

Social media isn't just for personal use — it can be a powerful networking tool:

• LinkedIn: Create a professional profile, join relevant groups, and engage with content posted by industry leaders.
• Twitter and Instagram: Follow entrepreneurs and business leaders, participate in conversations, and share your own business journey.

Mark your brand — branding & marketing strategies

Creating a solid brand for your business is crucial in today's competitive market.

Branding is more than just a logo or a catchy name:

It encompasses your business's identity, values, and the message you convey to your customers.

As a young entrepreneur, your brand can reflect your unique perspective and energy.

So let me help you develop your brand; follow these steps:

1. Define your brand personality: Consider what makes your business unique. Is it your products' innovative nature, commitment to sustainability, or the youthful energy behind your brand? This personality will guide your branding decisions.
2. Create a memorable logo and design elements: Your design elements, color scheme, and logo should reflect your brand personality. These elements will appear on everything from your website to your packaging, so they should be distinctive and memorable.
3. Craft your brand message and voice: What message do you want to convey to your audience? Your brand voice could be friendly, professional, quirky, or whatever aligns with your brand personality. This voice should be consistent in all your communications.

Develop effective marketing strategies

Marketing is all about connecting with your audience at the right place and time.

As a teenager in the digital age, you have a unique advantage in understanding current digital platforms.

Utilize this and more conventional advertising to grow your business:

1. Leverage social media: Social media platforms are powerful tools for reaching a broad audience. Share your story, engage with your followers, and use these platforms to showcase your products or services.
2. Content marketing: Develop a blog, create videos, or start a podcast. Content marketing is about providing value to your audience, establishing authority, and improving your online visibility.
3. Email marketing: You can receive emails from events or through surveys. Use email campaigns to keep your audience informed about new products, offers, and business news.
4. Networking and public speaking: Attend local business events, youth entrepreneur workshops, and consider public speaking opportunities. These platforms can help you build your brand and gain exposure for your business.

Striking a balance — education & business

Remember earlier when I mentioned school?

Well:

While embarking on a business venture as a teenager is exciting, it's a balancing act.

Realistically:

Education provides fundamental knowledge and skills that can be invaluable in your entrepreneurial journey.

While we often hear stories of successful entrepreneurs such as Mark Zuckerberg and Bill gates dropping out, remember, they both dropped out of Harvard University.

And the university has a rejection rate of regularly less (sometimes much less) than 10%. You had to be truly exceptional anyways to get in!

So:

Instead of seeing school as something that's holding back, find the value.

Recognize how school subjects can offer relevant insights and skills for your business, such as math for financial literacy or language arts for communication and marketing.

Manage your time well

Starting a business will take a lot of your time—just ask any local businesses in your area.

It's crucial that you properly manage your time and understand the art of prioritization.

Differentiate between urgent and essential tasks in your business and academic life.

Allocate your time accordingly.

Develop a structured schedule that allocates time for:

• schoolwork
• Business activities
• Personal time (remember to pay attention to this, or you risk burning out!)

Utilize tools like digital calendars, planners, or apps to keep track of your commitments.

And set achievable goals for both your business and academic pursuits!

Break these down into manageable tasks to avoid feeling overwhelmed.

Here are some tips to ensure that you stay grounded through all of this:

• Learn to say no: Realize that you can't do everything. Learn to say no to activities and opportunities that don't align with your priorities or schedule.
• Seek support: Don't hesitate to seek support when you need it. This can be from teachers, family, or friends who can offer help or advice.
• Manage stress: Develop stress management techniques like regular exercise, hobbies, or mindfulness practices.
• Maintain a healthy lifestyle: Pay attention to your physical and mental health. Eat healthy, get plenty of rest, and engage in physical activities.
• Be flexible: Adapt your plans as business and academic life circumstances change. Flexibility is critical to maintaining balance.
• Learn from experiences: Reflect on your experiences. Each challenge and success in balancing business and education provides valuable life lessons.

Embrace challenges

Embarking on a business adventure as a teenager is a pathway lined with both exciting opportunities and inevitable challenges:

• Limited funding,
• Balancing schoolwork and business,
• And a steep learning curve are just the start.

The first step is to acknowledge these challenges, not as insurmountable obstacles but as aspects of the journey that require strategy and adaptation.

Perhaps the most crucial lesson in entrepreneurship is learning to view failure not as a defeat but as a valuable experience.

The stories of today's successes are often filled with failures - each a stepping stone to eventual success.

It's about embracing a mindset that every setback teaches you something new about your business and yourself.

Analyze failures constructively

When faced with setbacks, take time to analyze what happened.

What were the contributing factors? What could be done differently next time?

Maintaining a journal of your business journey and documenting successes and failures can be a handy tool for reflection and learning.

The art of "pivoting"

Entrepreneurship often requires quick thinking and the ability to pivot - making significant changes to your strategy in response to market feedback or challenges.

Learning to pivot effectively means staying attuned to your business environment and being willing to make bold changes when necessary.

Celebrate your success — no matter how small!

Setting clear, achievable goals for your business can help keep you focused and motivated.

Equally important is celebrating the small victories along the way.

Each milestone, no matter how small, is progress and a reason to celebrate.

Understand how to start a business as a teenager? Get started!

As I wrap up this guide, it's clear that starting a business at a young age is a foundational experience that sets the stage for lifelong learning and growth.

Looking ahead, the possibilities are boundless.

The skills and experiences gained through early entrepreneurial endeavors can lead to diverse growth paths:

From scaling up your initial venture to exploring new business opportunities or even venturing into social entrepreneurship.

The long-term benefits of these experiences extend beyond business success; they foster a mindset of continuous improvement and open-mindedness essential in any future career.

As today's young entrepreneurs, you are the trailblazers for the future of business and innovation.

Your early start in the entrepreneurial world equips you with a unique perspective and agility to adapt to an ever-evolving global landscape.

Keep nurturing your ideas, learning from your experiences, and, above all, pushing the boundaries of what's possible.

The future is bright, and it's yours to take!

Looking to get into more detail? Read our comprehensive guide on how to start a business.