7 Foolproof Steps To Starting A Business
There is a lot that goes into starting a business.
From having a profitable idea, developing a sound business plan, getting funding, and figuring out marketing.
Here’s a checklist of 7 things to consider before launching a business.
1. Profitable business idea
Coming up with a great idea is harder than you think.
Before launching a business, you need to make sure that there is a market for it, in other words, your business needs to have a product-market fit.
Product-market-fit means that people are willing to pay for your service/product because the problem you are solving is big/important enough.
If you’re not sure where to begin, consider talking to people who are already in your target market. Ask them about their needs and wants, and see if there’s anything missing that your business could provide. You can also look at online resources such as forums and social media groups related to your niche.
2. Idea validation
No matter how good a solution you have, your business is less likely to succeed if people do not pay for it. Validation helps you know this before you start investing time and money into the idea. You will need to perform competitor analysis and gather detailed user feedback.
You will then need to create wireframes and then build the minimum viable product (MVP). The MVP will have basic key features so you can gather feedback and know what additional features to add to the SaaS product you develop.
3. Financing a business
Once you are sure about product-market fit, securing adequate financing is the second most important step in launching a business.
There are 8 ways to finance a business:
1. Bootstrapping: fund your start-up yourself
2. Get support from friends and family
3. Join an accelerator or an incubator program (popular in tech businesses)
4. Venture capital funds (for high-growth startups mainly)
5. Reach out to the Angels Investors
6. Try crowdfunding
7. Request a small business grant from a government
8. Request a loan from a bank or line of credit from a reputable fintech provider.
4. Choose a business legal structure and register a business
One of the first decisions you’ll need to make when launching a small business is what legal structure to choose. Small businesses have four main options:
- Sole proprietorship
- Limited liability company (LLC)
Each option has its own advantages and disadvantages, so choosing the right one for your business is important.
The next step is to register your business with the state/country in which you will be operating. Each state/country has its own requirements for business registration, so it’s important to check with your state’s rules and regulations.
You will also need to register the company name for your business and make sure it is available.
5. Develop a business plan
While it may seem premature to start writing a business plan at this point, it can be an important tool in giving you direction. A business plan should help you identify:
* Your unique value proposition
* The problem you want to solve
* The market you will target
* Your competition
* The people (team members) you will need
* Revenue models
* The cost associated with launching the business
6. Focus on your customers
The purpose of a company is to create customers, so the customer’s needs have to come first. Without customers paying you, you wouldn’t have your business in the first place.
From choosing the right products or services to offering outstanding customer service, everything you do should be focused on giving your customers what they want and need.
After all, they’re the ones who are keeping your business afloat.
7. Hire a team
Talented employees is key to a successful business.
So take hiring and onboarding seriously from the beginning.
The type of people you hire and how you train them as their team leader will form your company culture.
If you are starting a business that requires employing staff you will need to take care of all the necessary paperwork and compliance issues.
This includes things like getting an employer identification number (EIN) from the HMRC, applying for workers’ compensation insurance, and so on.
In the US, hiring employees can be more expensive for a business owner than hiring independent contractors because the employer is responsible for withholding taxes from employee paychecks and paying unemployment, workers’ compensation, and Social Security/Medicare taxes.
However, employees typically have a higher level of job security and may be more invested in the company’s success.
Many people open successful businesses every day.
A careful understanding of business and adequate preparation can improve your chances of succeeding enormously.
Properly researching, financing, staffing, and executing your plan is key to making sure you reach your business goals.