Ramit Sethi's 5 Best Tips for Starting a Business

Watch out for the rain of ideas.

There's a lot that goes into building a small business. Having started a few himself, personal finance guru Ramit Sethi knows this very well. But he also knows you won't build your business if you don't actually start. Here's some of his best advice on how to do just that.

1. Don't wait for ideas to "fall down from the sky"

One of the most common reasons aspiring entrepreneurs haven't yet started a business is because they think they don't have any ideas for a business. As Sethi says, however, it's not about waiting for that perfect idea -- it's about doing the work to find it. 

"The assumption is 'I'm waiting for a magical idea to fall down from the sky.' And that's not how it works. If you want to start a business, you find an idea. And it's not the perfect idea; it's one of many."

He suggests idea mapping. Start with a few general concepts -- things you're good at, things you've experienced, etc. -- and build from there. Sethi believes it's more a numbers game than it is waiting for inspiration to shine down from above.

"You generate hundreds of ideas," he says, "then you slice and dice them, and you test them."

2. Make the decision to start, no excuses

Once you have your idea, get started! Don't let the search for perfection -- or any other excuse -- stop you from making the leap.

"If you want to start a business, make a decision to do so today. (If not, that's OK!)," Sethi wrote in a social media post. "You don’t need the perfect business with the most beautiful website. You just need an idea that you can turn into an asset that your customers are happy to pay for. Keep it simple."

And yes, saying you "don't' have the time" isn't justification -- it's just another excuse. In Sethi's opinion, saying you don't have time for your business is the same as saying it simply isn't a priority for you.

If you keep finding excuses not to start, it's time to get real with yourself. What's the real reason you haven't started yet? Is it fear of failing, is it lack of true motivation? Whatever the case, address the true reason behind your excuses rather than letting them stop you.

3. Focus on what can go right

Sure, building a business is hard. And many businesses fail. But you can't be afraid to make mistakes or you'll never get anything done. As Sethi likes to say, mistakes are just learning opportunities. 

And he's had his fair share, as he's revealed when talking about starting his own businesses.

"We would probably all admit that we made every mistake in the book. Everything from spending time raising money from people we shouldn't have, to launching without a clear understanding of our customer market, and needing to change the entire business model as it was live," he says. "Those are some critical mistakes that many entrepreneurs make."

Don't worry about what mistakes you're going to make -- because you're going to make them one way or another. Learn from them and put them behind you. Keep your focus on what's going right, so you can build on what you're doing well.

4. Figure out what your customers really want

According to Sethi, the most important thing you can do to grow your business is to actually get to know your customers -- and their needs. As he says, "Focus on the customer, understand what they truly want. Sometimes they won't even tell you. You have to find it out like an investigator. And then give it to them."

And that starts at the beginning. Sethi tells the story of when he first started learning to build his personal finance business, he spent a lot of time chatting with friends and family about their own money questions and concerns. He was able to use that information to start adapting his product to fit what his potential customers really need and want.

5. Don't fixate on scalability

Many folks starting a new business have grandiose notions of becoming the next Google. And sure, it's all well and good to have aspirational goals. But you can't be so focused on how big your business is going to grow that you forget to, you know, grow it.

While there should be some consideration as to whether what you're doing now will serve your business in the future, Sethi says scalability shouldn't be your primary -- or even secondary -- concern.

"Your first goal with a business should be to generate profit. Not to worry about whether it’s 'scalable' or not," he says. "Too many founders worry about scaling to $100 million without even generating $1,000."

Once your business is profitable and growing naturally, then you can worry about scaling it to the next level. And chances are good that the things you thought would scale well at the start are far from what you need when the time comes.