The millennials don\’t want to be hooked into working a 9-5 job like their previous
generation. A lot of them prefer to have the freedom and benefit of running their own
business. But, as snazzy as it sounds, there are a few things you should know before
you start a startup.
Let\’s take a look at the major steps involved in the building of a startup from beginning
to running it successfully.
1. The ideation
You need an idea. An idea that works in the market you are dealing with. Having an out
of the box idea that no one has thought about before is good. But it does not always
have to be that way. Rather think of a solution to the existing insufficiencies or problems
people are facing.
2. Feasibility and Market Research
What matters more than the originality of the idea is its feasibility. Things that work in
one place need not necessarily work in others. If what you want to do would make
people\’s lives better, they will subscribe to it.
If there aren’t many competitors for your idea, that could mean a potential opportunity.
But it could also mean a lack of customer demand. Assessing the situation is
sometimes tricky and the main factor deciding your success and failure lies there.
3. Find your target audience
Identifying your target market is important. Not all people want to buy your products. So
the more you can narrow down your audience based on their interests, the less will be
your cost of marketing. Otherwise, you will have to spend a fortune on promotions with
very little return on investment.
4. Registering your business
When all the above is said and done, then comes the registration of your startup. The
actual processes involved in registering a company varies with jurisdictions. But all
countries will require that when you start to make an income, you need to have a tax ID
and registration number. Registering the business gives you legal protection and
credibility. It will also define the company assets from your personal assets.
5. Bookkeeping and accounting
When the company starts to make money or spend money, you have to keep track of it.
Bookkeeping is inevitable because running the firm necessitates calculation of profits
and losses, filing tax returns, and whatnot. There are a few ways to hire accountants for
your startup. You can either hire accountants or hire an accounting firm.
Doing all the accounting works in-house is the ideal option for maximum accuracy and
timely delivery of the reports. But for a startup, cost effectiveness is the key. You can
find accounting firms that offer cheap services. Quality of their work, but is questionable.
Therefore, hiring freelance accountants that come with all the advantages of an
in-house accounting team is best for a startup.
6. Team building
You can’t do all the work yourself. You need more hands. Ideally, your team\’s size
should be just right. A team that is too small will result in slacking whereas overmanning
will bleed out the company’s funds and will sometimes result in the early demise of the
business. Another thing to look out for is whether the people you hire are qualified.
Overqualified employees are white elephants, and underqualified are just superfluous.
To successfully run the company, apart from the technical and financial side of the
business, you have to be a good leader to keep the morale of your employees high and
keep them motivated to do the work. If you are not good at this, find someone who is.
7. Finalizing business model and revenue model
Now it’s time to finalize the business model. Whether the company will continue to run
or will it fade and die out depends on this. Even some huge investments get their
revenue models wrong. In the end, the aim of the company is to make a profit and your
business model should practically allow that. Giving out your products at a low margin
or at a loss will get you a lot of sales. But most startups do not have deep pockets.
8. Initial investment
Finding the initial investment varies with business. Sometimes it can be just your
personal computer. For instance, the now a billion dollar company Airbnb started out
with the founders renting out their own apartment.
9. Product Development
Customers should realize the need for your product and be able to use them.
Sometimes a product can be too good for your potential customers. Something that is
too ahead of its time is doomed to fail, no matter how good you feel about the product.
A successful product should not be obsolete before making it to the market either.
10. Getting your marketing strategy right
Developing a great product is not enough, you have to get people to know about it.
Knowing your target audience is the first step to developing a solid marketing strategy.
You should have a good idea about the interests, age group, gender, location,
education level, and financial status of your potential customers.
Finding out your competitors and analyzing how they promote their products will also
help you develop your own marketing strategy. It’s not about copycatting, though. You
can come up with an idea that your competitors haven’t tried yet to get an edge over
11. Building your sales funnel
Everyone who comes across your products won’t buy them. There are several stages
involved between someone getting to know your product to actually opening up their
wallets. That’s called a sales funnel. In each step, you have to use a different strategy to
carry your potential customers (or leads) to the next level.
A sales funnel helps you to approach leads that are at different levels of the funnel in a
manner that is suitable for them. You need an efficient strategy that converts your leads
to customers. You’ll also need one that is a bit different from your competitors to avoid
looking exactly like them. Building a unique sales funnel will also help with your