Starting a business is not a small undertaking. You have to consider many factors, and it is crucial to spare some time for research and prepare as much as possible. About 50 percent of new businesses fail within the first five years of operation. However, contemporary world entrepreneurs can change that narrative.
Despite the multiple sacrifices startup founders face, about 85 percent of startup entrepreneurs are able to streamroll. There are essential steps to consider if you're contemplating having an artisan or tech or any other form of startup.
We have some of the must read secrets for a successful startup. Before we delve into what you need for a business startup, let's first examine what a startup business is.
What is a startup business?
A startup is a business in its early stages of development. A typical entrepreneurial business is started by 1-3 startup founders who focus on capitalizing their perceived market niche by developing a platform, product, or services.
A startup is a venture initiated by startup founders around a problem or idea with a potential for a significant business opportunity or impact. Most of the time, the actual development begins even before the entrepreneurs get the capital to start the business. The process begins with finding an idea, niche, or a significant problem worth solving and building a dedicated team aligned with common goals to make the dream a reality.
One feature that almost everyone seems to agree with about startups is that they focus on growth. A small business may be comfortable staying small forever, but startup founders want their businesses to grow. In its early stages, a company with goals and scale to grow qualifies to be a startup. Startups may begin as small businesses, but not all small businesses are startups.
How to start up a business
Now that you know what a startup is, you might be wondering where to start. Should you consider a business name or logo to use throughout the business? Is it essential for you to start applying for loans already?
It can be challenging to know the proper steps to take. Entrepreneurship is all about taking risks and taking time to know what will work and what can resonate with your potential clients.
However, rather than being overwhelmed by the tasks and decisions you have at hand, there are simple steps to kick start the development of a startup. Let's get started.
Determine if you want to go for entrepreneurship
Before delving into your potential business details, it's best to take stock of yourself and the situation. Here are some of the questions you should ask yourself:
- What are your skills?
- What do you like to do most?
- Do you want to provide goods or services?
- Why do you want to start the business
- How much capital do you have to risk?
- Is it a part-time or full-time venture?
Your answers to the above questions will allow you to narrow your focus. The step is not meant to dissuade you from starting that coffee shop, boutique, online business, or food truck startup. It's here to have you thinking and planning. Successful startups do not only rely on passion alone.
Refine the business idea
Once you understand why you want to establish a business, it's time to refine and develop your idea. More than likely, you might have something in mind after going through a self-assessment. It's not enough to think you have a good idea and run with it. Ensure you validate that there is a need and address whether the idea is sustainable.
Conduct market research
It is crucial to evaluate your idea by determining who will buy the products or services. Who are your competitors? Market research will help you address the opportunity, market size, value proposition, and competition.
Create a business plan
A business plan will come in handy, especially if you're seeking outside financing. However, even if you want to finance the business alone, a business plan to determine what will make your venture profitable, and what needs to get done. A business plan can also be used as a guide book to ensure that you don’t deviate from your goals.
Make your business legal
Registering your startup is the first step to actualize your plan. However, as with the personal evaluation step, spend some time to know the advantages and disadvantages of different startups. If you can, work with a lawyer to iron out the details. You don't want to go wrong in this area. You will also need to get proper business licenses and permits. Entrepreneurs must read and get conversant with latest business laws regulations.
How to get money for a startup
Depending on the venture's nature or size, entrepreneurs can seek finance from different internal and external sources. However, most startups begin with loans, financing from credit cards, or help from friends and relatives.
Standard lending options include:
- Venture capital
- Loan from banks
- Accounts receivable
- Small business administration loans
- Credit cards
- Government grants
To qualify for financial aid from financial institutions, you need to have substantial collateral assets, a good credit score, and correct financial statements. Licensing proceeds may come in handy for tech entrepreneurs. Licensing proceeds involves upfront fees paid to tech startup innovators and may include more payments as the technology is commercialized.
Consider the following options if you're considering starting a business with no money.
- start a service-based online business in fields like graphic design, software development, and other tech startups
- Sell digital products. You can opt to sell a guide book or share music videos to be downloaded.
With the above tricks, you have all the secrets needed to operate a successful startup. Make sure you learn more from guide books, training sessions, or going for seminars. You can also run a tech startup with no money. Make sure you put the above tricks into practice to see your startup grow.