5 Things Every Entrepreneur Should be Prepared for Before Starting Up
With proper ground work, startups stand a better chance to hit the bullseye and become a sustainable business.
Launching a startup requires a lot more preparation beyond the germination of a great idea, organising some funds to get started and naming the business. It requires management skills, leadership qualities, understanding of the market and forward planning to ensure a long innings for the venture. More importantly sufficient time should be spent in sorting out some key universal fundamentals thoroughly through manageable steps, to take on a whole new industry and its specific demands. New entrepreneurs should not overlook these important preparatory steps in the excitement of launching a new business as, running a startup is a huge lifelong commitment.
Focusing on these five important steps before launching the business can have a huge impact on the outcomes into the future.
Scope out the industry to validate whether the idea is viable or not
It is a big mistake to start working on an idea without verifying whether the market is ready for it. Will the demand sustain beyond the initial novelty value and whether a scalable market exists for the service or product are questions which need to be addressed. It is best to take a direct route and talk to people from the industry, suppliers, retailers and customers in your segment to get a first hand feedback on all aspects.
An entrepreneur needs to be very sure what the customer wants, which customer profile wants it, and what influences their purchasing decisions. A lot of times an idea may seem brilliant but could turn out as too much of a niche product. In that case it cannot justify the billion dollar fundings and the effort to keep it running in the long term.
Tackling these questions early on can save a lot of heartburn and disappointment at later stages for startups.
Size up whether your business can match up and stay ahead of the competition
Knowing your competition should be a prerequisite before launching your startup. Experiencing their service and product first hand as a customer will give good insights into how the competition operates. Visit their websites and subscribe to their mailing list to stay clued into their new offerings and customer feedback. Track what’s written about them on various platforms. It will help a newbie startup gain valuable insights into knowing its competitions’ supply chain, innovations in the pipeline and financial strengths.
It is only after this thorough homework is done can a startup assess whether they have anything unique to offer, have sufficient operational reach and financial strength to face the competition.
Pilot test the idea or product at micro levels through apprenticing or partnering with bigger projects
It makes sense to test the waters on the side while holding down a full-time job to avoid the pressure of launching a startup fast. This can be done by polling potential customers and taking pre-orders on a small scale for your product. Founders can, over the weekends, participate in exhibitions and forums to gauge the interest and to determine future pricing. They can also engage with their prospects on social network platforms for direct selling.
Have a plan ready for future funding, the shape of the company and the laws governing your business
With the government frequently changing the regulations in trade practices and joint ventures sector, startups need to be clued in at all times, so they are abreast with the latest regulations and operate within their ambit. They also need competent lawyers, accountants, and tax advisors to offer guidance with respect to the business structure they must have in alignment with their future ambitions and existing economic landscape.
Moreover, they must have self funding plans in place for the future before launching the business, as investor funding is not a guarantee and often come with a lot of riders. It could be from personal sources or industry mentors. Also, conscious planning is required to restrict spending money on fixed expenses like long term leases, permanent staff, manufacturing line etc. after the startup is launched. Efforts should be to outsource or minimise expenses to bootstrap towards growth.
Hiring the right people for the job
You’re only as good as the people who have your back. It’s better to have a staff of one who is an asset rather than four whom you have to teach since you yourself will be hard pressed for time. Moreover, you’ll lose valuable time in grooming them and getting them to reach a point when they can successfully deliver and contribute to the startup’s growth.
However, the fact remains that for a startup it is not easy to get hire good talent since it is still far from being an established brand. So the search has to start well before the launch in the relevant networks and institutions.
With proper ground work, startups stand a better chance to hit the bullseye and become a sustainable business. Well prepared startups can put all worries to rest and focus on getting the work done. As Drew Houston, Dropbox Founder and CEO says, “Don’t worry about failure. You only have to be right once”.
Disclaimer: The views expressed in the article above are those of the authors' and do not necessarily represent or reflect the views of this publishing house
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