How to Start a Business as a Teenager

Starting a business as a teenager is the ultimate boss move – it’s like telling the world, “I don’t need to wait until I’m a full-fledged adult to start making moves!” Whether you’re hustling with a lemonade stand or walking dogs around the neighborhood, you’re already on the path to greatness. Sure, making a bit of cash and getting your name out there is nice, but the real value lies in the experience you gain along the way. So why not take advantage of your youthful energy and start flexing those entrepreneurial muscles? Who knows, you might just become the next big thing before you even graduate high school!

Read on to learn just how to go about starting your own business as a teenager. 

Is It Legal to Start a Business as Teenager?

A child can run a business and do it legally and proficiently. There may be situations where an adult’s signature is required for business contracts or other paperwork, but apart from that, any young person with an entrepreneurial drive can start a business venture.

The specific laws governing businesses owned by minors vary from state to state, so it’s important to research and understand all the relevant regulations in your area before starting your own company as a teenager.

Why Start a Business Even if You’re Still a Teenager?

Though there are plenty of obstacles for young entrepreneurs to overcome when launching a business, the effort can be worth it in the end. Starting up now gives teens valuable experience in financial management and marketing that will help prepare them for future endeavors. Plus, running their own business allows teens to explore potential career paths outside of traditional four-year colleges and learn important entrepreneurial skills such as problem-solving and communication. By building their brand and developing relationships with mentors over time, teenagers can also create something that could potentially turn into a profitable business later on down the road.

10 Steps to Starting a Business as a Teenager

It’s not an easy process for teens to start a business, but it’s doable! Here are the steps you’ll need to follow:

Research Potential Business Ideas

First up: your free time. Are you a social butterfly with a packed schedule, or do you have plenty of free time to devote to your entrepreneurial endeavors? Next, think about your skills and interests. Are you a crafting queen, a nature enthusiast, or an animal lover? Your passions can help guide you toward a business idea you’ll enjoy. Of course, there’s always the matter of startup costs – some businesses require more money upfront than others. 

When brainstorming business ideas, it’s important to consider a few other aspects as well. One of these is competition – take a look around your area or online to see if other businesses are offering similar products or services. If there are, think about how you can differentiate yourself and stand out from the crowd. 

Another factor to consider is demand – is there a need for the product or service you’re considering? If not, you may want to pivot your idea to better align with what people are looking for. Don’t forget about legal considerations, as some businesses may require permits or licenses to operate, so make sure you do your research before diving in. By taking all of these factors into account, you’ll be able to brainstorm a business idea that’s not only exciting but also has a solid chance of success.

Find a Mentor or Business Coach

Everyone can use a little guidance sometimes, which is where finding a mentor comes in. The good news is, you don’t have to look far to find someone willing to take you under their wing. Start by checking in with local business organizations, school career centers, or even your parents’ friends – you never know who might have some experience and be willing to share it with you. Don’t be afraid to get creative – maybe there’s a social media influencer or YouTube personality whose business savvy you admire, and you can reach out to them for advice. 

When you do find a mentor, make sure you’re respectful of their time and expertise. Come prepared with specific questions, listen carefully to their advice, and be open to constructive criticism. 

Develop a Business Plan

The words “business plan” might not exactly make your heart sing with excitement, but it’s a crucial step in making your business a success. Start by outlining your goals and objectives, and then get into the nitty-gritty details like startup costs, target market, and revenue projections. Don’t forget to factor in some wiggle room for unforeseen obstacles and challenges – as they say, hope for the best but plan for the worst. One important thing to keep in mind when creating your business plan is to be realistic – don’t overestimate your potential revenue or underestimate your expenses. 

If you’re feeling overwhelmed, don’t be afraid to ask your mentor or other business owners for help. At the end of the day, a solid business plan will not only help you stay on track, but it’ll also impress potential investors and customers. 

Here is what a business plan includes:

Services to Offer

Write about the products or services that your business offers. Maybe you’re offering a lawn care service, dog walking, house-sitting, or selling handmade jewelry and trinkets. Be sure to highlight what makes your products or services stand out from the competition – what’s your unique selling point? What sets you apart from the crowd?

Include details about the quality of your products or services, and any features that make them special. Don’t be afraid to get specific and show off what makes your business unique! You want to give potential customers a reason to choose you over everyone else.

Target Clients

Who are the people that you want to offer your services to? Are they individuals, small businesses, or large corporations? Consider factors such as age, gender, location, and interests when determining your target market.

Financial Forecast

Starting a business can come with some costs, so you’ll need a financial forecast. Consider the potential expenses, like equipment, supplies, marketing, etc. Figure out how much you need to invest and how you plan to finance it.

As a teenager without much capital or credit history to leverage, you may need to look into grants or loans from friends or family members to get started. You should also understand what financing options are available through banks or investors if applicable. 

Pricing Structure

You need to consider the costs of materials, labor, and other expenses. Unless, of course, you plan on living on air and sunshine alone – which isn’t recommended. You also need to think about your target market and what they’re willing to shell out for your goods. Remember, you’re not just selling a product or service; you’re selling your brand and yourself. So, don’t go pricing yourself out of the market or undercharging for your hard work. It’s a balancing act.

Operation Cost

With the help of your parent or mentor, you’ll want to cover operation costs in your plan. Factor in the cost of buying or renting necessary equipment or machinery, potential rental fees for any physical space needed, and other material costs. You should also think about the labor costs associated with hiring any needed employees and accounting for wages and benefits for those workers should your business expand in the future. 

Name of Business

Choosing a unique and memorable name for your business is essential as a teenager. It can help you stand out from the competition and make a lasting impression on potential customers. Brainstorm different ideas and ask for feedback from friends and family.

Choose Your Business Structure

When it comes to teens looking for ways to make money, several different business structures can be explored.

Sole Proprietorship

One option is starting a sole proprietorship, which doesn’t require any legal paperwork and allows the owner to keep all of the profits made from the business. This type of business structure works best when a teen is selling goods online or providing basic services such as pet-sitting or tutoring. 

General Partnership

Teens should also consider forming a general partnership if they plan on starting a business with friends; this will allow each partner to have an equal share in decision-making and revenue.

Limited Partnership

A limited partnership for teens is an innovative way to help young people gain financial literacy, business acumen, and basic money management skills. This type of partnership enables teens to learn the basics of creating a business and managing investments under the guidance of an adult mentor or partner. 

This type of partnership can be beneficial for both parties involved. Teens can gain real-world experience in running a business and making wise investments, while their adult mentors can share their expertise and provide guidance. 

Limited Liability Company

Another option would be to form a Limited Liability Company (LLC), which protects the owners in the event something goes wrong with the business. 


Teens who want more complex structures may choose to set up a corporation; this involves creating documents such as articles of incorporation and bylaws that outline how the corporation will operate. It also requires shareholders, who must register with the state where the corporation is formed. Although it’s more complicated than other forms of business structures, corporations offer limited liability protection for their owners and tax benefits.

Secure Your Financing

As a teenager, you may not have a lot of capital to work with, but there are plenty of options to explore.

Grants: Some organizations offer grants specifically for young entrepreneurs. Do your research and see if any are available for your type of business.

Loans: If you’re confident in your business plan, you might consider taking out a loan. However, tread carefully – you don’t want to get in over your head with debt. You’ll also need a parent or adult’s help qualifying if you’re a minor. In most cases, underage teens can’t legally enter binding contracts. 

Investors: Maybe you have a wealthy aunt or uncle who’s been waiting for a chance to support your dreams, or perhaps you can pitch your business idea to angel investors. Just be sure to have a solid plan in place before you start making your case.

Crowdfunding: If your business has a unique or compelling story, crowdfunding can be a great way to get people excited about supporting you. Just remember that it takes a lot of work to create a successful crowdfunding campaign.

Register Your Business

Once you’ve chosen the appropriate legal structure, you’ll register the business with the state in which you plan to operate. This involves filing paperwork through the Secretary of State’s office that includes information such as the name of the entity, address, purpose, and type of business. Depending on which state you’re registering in and the type of business, there may be additional requirements such as publishing notifications in local newspapers or obtaining certain licenses or permits from other government agencies. Keep in mind, as a minor you may need help from your parents or legal guardian due to state laws and regulations.

Obtain Licenses and Permits 

As a teenager starting a business, obtaining licenses and permits is an important part of the process. Depending on the business structure you choose, the licenses and permits can vary from state to local requirements. It’s important to do your research and contact local government offices for more information about what is required for your particular business. 

Open a Business Bank Account

You’ll want to open a business bank account to keep business funds separate from personal funds. Although you usually need to be 18 to open a business account, some banks do provide special accounts just for teen business owners. If you aren’t using a teen-specific account, you can open a regular business account with the help of your parent or guardian. You and your parent/guardian may need to provide identification to the bank. Make sure to research different banks and financial institutions.

Get Business Insurance

Accidents and unexpected events can happen to anyone, and that includes your small business. Protect your hard work and investments by getting business insurance.

However, as a minor, there may be some legal restrictions and requirements when it comes to getting business insurance. Some insurance providers may require a parent or guardian to sign off on the policy, and there may be limitations on the type and amount of coverage you can get.

When researching insurance providers, make sure to look into their policies for minors and any requirements or restrictions that may apply. 

Market Your Business 

Consider developing relationships with influencers who can help spread the word about your venture or creating targeted campaigns on social media platforms like Instagram and TikTok to reach younger audiences. 

doola Has Your Back

You’ve reached the end of the ultimate guide to teenage entrepreneurship. You’re now equipped with everything you need to make your business dreams a reality. 

Remember, it’s not going to be all sunshine and rainbows. You’ll encounter challenges and obstacles along the way, but that’s okay. Mistakes and failures are part of the journey, and they make the eventual success even sweeter. It’s like playing a video game on hard mode – you’ll have to work a little harder, but the victory will be so much sweeter.

Don’t forget, when it comes to managing your finances, doola is here to help you every step of the way from setting up your LLC, to opening a business bank account, to bookkeeping. We have your back!


What business should I start as a teen?

Starting a business as a teenager might seem intimidating, but there are plenty of ideas out there that don’t require much in the way of capital or resources. Many teens have found success with businesses ranging from tutoring and pet-sitting to crafting and even freelance writing.

How to start a business as a teenager with no money?

If you don’t have access to money for startup costs, you can look for ways to offset those costs by bartering for services, acquiring free materials through donations, or digging through thrift stores for supplies. There are also numerous grants available specifically for teenage entrepreneurs. 

What are business ideas for teens?

Some popular business ideas for teens include starting a YouTube channel, selling handmade items on Etsy, offering pet-sitting services, babysitting, tutoring, and more. Teens may also want to consider start-ups such as creating mobile apps, providing virtual assistant services, becoming an Uber driver, or selling products through Amazon FBA (Fullfillment by Amazon). 

doola's website is for general information purposes only and doesn't provide official law or tax advice. For tax or legal advice we are happy to connect you to a professional in our network! Please see our terms and privacy policy. Thank you and please don't hesitate to reach out with any questions.

Start your dream business and keep it 100% compliant

Turn your dream idea into your dream business.