Starting a business as a teenager is a great way to build your character and your resume. Are you a young person with an amazing business idea? Or maybe you simply aren’t satisfied working the usual after-school job for extra money. 

Whatever your reasons, keep reading to discover a step-by-step guide on how to start a business as a teenager. Plus, learn about the advantages and other factors you need to consider when becoming a young entrepreneur. 

Step 1: Develop Your Business Idea

The first step when starting a business as a teenager is to develop your business idea. You might already have a great idea (and that’s why you want to start a business now). Or you may need to brainstorm and come up with one. 

If you’re a teenager, the best business ideas are ones that you can pursue while still fulfilling your other needs and responsibilities (such as school, homework, and a social life). Great business ideas also revolve around products and services for which there is high customer demand.

Since this is likely your first foray into running your own business, you might want to start small. Then, as your entrepreneurial skills grow, so can your business. Need some inspiration? Check out this article: Business Ideas for Teen Entrepreneurs to Learn and Earn

Step 2: Conduct Research

Once you have a solid business idea, it’s time to conduct your research. This is where you learn everything you can about the area in which you’re starting a business, including: 

  • The industry
  • Startup and operational costs
  • Potential competitors
  • Customer demand 
  • Funding options
  • Logistics

What are potential competitors doing that’s working? What’s not working? What are the specifics surrounding how you’ll advertise, sell, and deliver your products or services? Conduct as much research as you can to understand how you’ll need to run your chosen business. 

Again, as a teenager, you’ll likely need to be able to keep up with things like school work and social activities in addition to running your own business. So make sure you’ll be able to do so in the industry you’ve chosen. 

Step 3: Create Your Business Plan

After developing your business idea and thoroughly researching your industry, you need to create your business plan. This is where all the research you’ve done comes in handy. 

Taking the time to set up a business plan can help you find investors and enable you to stick to your goal of starting, running, and growing a business. A great business plan will include things like: 

  • Company description
  • Market analysis
  • Business structure and management
  • Marketing and sales plan
  • Financial needs and projections

Want to learn more about creating a business plan? Check out our business plan template

Step 4: Acquire Funding

Once your business plan is in place, you need to obtain the necessary funding for your new venture. A few ways teenagers often raise capital for their businesses include: 

  • Extra money from chores
  • Saving holiday / birthday money or allowances
  • Getting a part-time or side job

There are also more traditional ways of financing businesses regardless of age, such as: 

  • Bank loans
  • Investors
  • Lines of credit / business credit cards

The more traditional methods may necessitate help from your parents, guardians, or other adults. 

Step 5: Choose a Business Structure

One of the most important steps to starting a business as a teenager is to choose your business structure. The best choice here is heavily dependent on your business type, individual circumstances, and even what state your business is in. 

For example, if you’re running a pet-sitting business or providing art lessons, you may opt to simply be a sole proprietor. In that case, you might not need to register a formal business (unless you intend to get a business bank account). 

On the other hand, if you’re starting a business with a partner, you may want to form a general partnership. Or, if you need limited liability protection (separation of your business and personal assets and liabilities), you should consider starting a limited liability company (LLC). 

If forming an official business structure, such as an LLC or corporation, you need to research the laws regarding minor formation in your state. For instance, while a minor can own (or be a member of) an LLC in any state, certain states’ laws say that only an adult can form one. Learn more in our article: Can a Minor Own an LLC? 

Step 6: Decide on a Business Location and Name

Once you’ve decided on a business structure, it’s time to determine your business’s location and name. Figure out which state in which you’ll register your business, then research the naming process in that state. 

The reason you need to determine your structure first is because the structure could have an effect on the naming rules. 

For example, if your business is a corporation, it will need to have a relevant identifier at the end of it, such as “Inc.,” “Incorporated,” “Corp.,” etc. 

Research the business naming guidelines for your business structure from the Secretary of State where you plan to do business. You can also use our business name checker to see if your desired name is available, or even reserve your name here

Step 7: Register Your Business

Next it’s time to register your business! As we stated previously, depending on your state laws and business structure, you may be able to do this yourself. Or, if you’re under 18 and live in certain states, you may need the help of a parent or guardian. 

Either way, the general steps to registering a business include: 

Your Articles of Organization will include: 

  • Your business name
  • Your business address
  • Your registered agent and their contact information
  • Your business starting date
  • Your signature

Step 8: Create and Obtain Necessary Documents / Permits

Finally, after forming and registering your business, you need to create and obtain all the necessary documents and permits. These could include: 

  • An operating agreement (if you formed an LLC)
  • An EIN (state tax ID number)
  • Any necessary business licenses or permits

Starting a Business as a Teenager: Benefits and Considerations

Starting a business as a teenager comes with many advantages. However, there are also a few things you need to consider. 


Just a few of the benefits of starting a business as a teenager include: 

  • Character building
  • Career skill improvement
  • College resume enhancement
  • The potential to make more money 
  • The opportunity to explore what you want to do as an entrepreneur
  • The ability to begin building an income for the future at a young age


That said, you also need to consider the following before starting a business while you’re young: 

  • You need to be able to keep up with school and other activities
  • It’s important that your new venture allows you to get the rest you need
  • Make sure you can keep up with demand for your products or services without sacrificing in other areas of your life
  • Start a business in an area you’re passionate or excited about to be sure you’ll stick with it and be successful
  • Do your research so you are as prepared as possible for any eventuality in your new business
  • Understand the laws surrounding minors and business ownership in your state, and get the help of an adult when necessary
  • It might be a good idea to consult a lawyer and / or tax specialist so you understand all the nuances in your state and industry

How Can We Help?

Ready to form a business for yourself or your teenager? Or maybe you’re a teenager who’s starting a business. Whatever the case, we’re here to help. From formation to worry-free compliance, we’ve got all the services you need to start, run, and grow your business successfully. 

Disclaimer: The content on this page is for informational purposes only, and does not constitute legal, tax, or accounting advice. If you have specific questions about any of these topics, seek the counsel of a licensed professional.

Disclaimer: The content on this page is for information purposes only and does not constitute legal, tax, or accounting advice. If you have specific questions about any of these topics, seek the counsel of a licensed professional.

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Written by Team ZenBusiness

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