Last week, I was giving a presentation to a group of business students at Arizona State University about how to organize the chaos in a small business. But, as we moved into Q&A, I realized that the young entrepreneurs were less interested in what I had done in business and more into how I got started in it.
One student said she was an aspiring photographer, but she had no idea how to price her services or how to find her first customers. How did I do it?
That question snapped me back nearly 18 years to my early days in business and had me thinking about how I was able to go from working for free using equipment I didn't own, into building a seven-figure business.
If you're just getting started on the entrepreneurial path, take these four lessons to heart.
1. Get resourceful.
When I started my first business as a freshman in high school, a video production company, I didn't own a camera or a computer. That can make video production a little tricky.
But, I did have a high school video department, and they were more than happy to let me borrow some gear for a weekend. What they didn't realize is I was using their gear to film sporting competitions and weddings, making money selling videos, and checking the cameras back in on Monday.
Part of getting started in business is learning how to get creative and utilize the resources available to you. When others see an obstacle or a reason not to start, you find a way.
2. Provide value before charging for it.
Your first customers might not pay you. And that's okay.
To build a reputation in business, you need to have some success stories. So, start building success stories by doing free work for friends, family or neighbors that will let you.
After I bought some of my own video equipment, I stopped by a local car dealership and asked if they would let me film some sample footage of the cars in the lot that I could use on my demo reel. In return, I would give them all the footage for free. If they liked it, they could use it, no strings attached.
Well, my shots turned out great, they introduced me to their advertising agency, and that kicked off a multi-year relationship that would earn well over $100,000. And remember, I was in high school.
But it all started with an offer to get my hands dirty, for free.
3. Leverage your reputation.
Once you have a small sample of great work that you've done for free, ask those early "customers" for testimonials.
This could be a quote for your website, a review on LinkedIn, or even a Yelp review if you have a listing. The praise of your customers will go further than your own words ever could.
At this point, you can leverage your free work, and your reputation, to get paid work.
The hardest part here is the confidence to name your price, but remember that your services are worth what someone is willing to pay for them.
You might get your first customers by beating out other vendors as a low-cost option, but the lower your cost, the higher the demand for your services will be. So start low, and collect experience until you start to get busy.
4. Raise your price, a lot.
Many people make the mistake of pricing their services based on what they think is a "fair" hourly rate. But, as you get busier and start to value your time more, you'll learn to price your services both on the value that you provide to the customer and on what it's worth to you to take on the work.
I've hired five or six website developers over the years and all of them were college students or recent graduates that were just getting started. But every single time I find someone that is cheap and does amazing work, the same thing happens; they stop being cheap.
That's exactly what will happen to you if your services are truly valuable.
The sky is the limit for how much you can charge, as long as the value you are providing is greater in the minds of your customers.
Stop Waiting, Start Starting
If you wait until you have it all figured out, you'll never get started. But by starting for free, you limit the risk of your early believers and get the experience to skyrocket your success.
So, the sooner you get started, the sooner you'll be raising rates and raking in the customers!