With recent research showing that the average age of entrepreneurs is declining, we take a look at some of the specific issues and challenges faced by entrepreneurs aged under 18 and guide you through some of the main things to be aware of as a minor…
Starting a business at any age is a big challenge. Thinking of a good idea and then turning it into a profitable venture is no mean feat, but if you happen to be one of the growing number of entrepreneurs who are aged under 18 then there are some additional challenges that may be standing between you and entrepreneurial success. First of all, your age can bring barriers to setting up a business bank account, accessing credit and raising business finance.
There are also issues surrounding your legal status as a minor and the type of work that you can do, not to mention balancing business with your education and the usual business headaches of registering your company, understanding tax and growing your business. But despite these issues there is absolutely no reason why as a young person you can’t get started in business.
Dr. Haya Al-Dajani, Lecturer, Entrepreneurship and Small Business Management at Norwich Business Schooltells inspiresme.co.uk: "The rising trend in young enterprise might be attributed by some to the popularity of TV shows such as The Apprentice and Dragons Den. While this may be so, the trend is also encouraged by the great work of the Princes Trust, Peter Jones Enterprise Academy and the local young enterprise schemes and many other similar initiatives."
Dr Al-Dajani continues: "However, we still need to do more to ensure a dynamic entrepreneurial economy in the near future - when our youth reach adulthood. One way to contribute to this is through vibrant enterprise education at the school, college and university levels. Too many young men and women aspire to be millionaires or billionaires but are unaware of the social responsibilities that can come with this too. Getting young people to understand entrepreneurship as a means to social change and innovation rather than personal economic gains only is a real need that can be met by a collective effort from media, education institutions and successful entrepreneurs."
Bank accounts and raising finance
People aged under 18 are legally considered to be a minor and, unfortunately, this means that you can’t open a business bank account. It also means that you will be unable to borrow money or have a credit card, so if you need to raise finance for your business this needs to come from an alternative source. This could be:
- Getting a loan from a family member to fund your venture
- Going into business jointly with an adult who is legally able to access finance
- Grants or cash payments from enterprise funds, trusts or agencies
Thanks to the internet, many businesses can be set up with very little finance. If you already have a computer and an internet connection in your house it’s possible to start up an online business with less than £50 and then build it up into something bigger as you go along. A lack of finance doesn’t have to be a barrier to business success and you only have to look at some of the world’s most successful companies and entrepreneurs to know that this is true. Many well-known business figures such as Sir Alan Sugar started their businesses as minors and all on a shoestring budget.
Balancing your business, education and social time
Young people aged under 16 are required by law to be in full-time education and there are also restrictions on how many hours you can work per week. 14 to 15 year olds can work for no more than 12 hours a week during school terms and 25 hours a week during school holidays (14 year olds) or 35 hours a week during school holidays (15 year olds). It is essential that you find a good balance between your business, your education and things such as seeing your friends and relaxing with your family.
A young age and a lack of experience doesn’t mean you can’t succeed
As a young person you might feel daunted by talking to experienced business people and you might wonder about things such as whether they will take you seriously as a minor. The good news is that many people are impressed by young entrepreneurs and see it as a good thing; so as long as you conduct yourself in a professional manner there is no reason why other business people won’t take you seriously or why it should act as a barrier to success.
Don’t be afraid to ask for help
There are many organisations out there such as Young Enterprise and Youth Enterprise that can provide you with practical business advice and even funding. There is also a wealth of general information available about starting a business on this website and across the internet.
If you are looking to start up your own business, why not take a look at our innovative commercial properties?