Eureka! You’ve just had the mother of all business ideas that sure to turn you into the up and coming start-up of the year. It came to you in one of those rare moments of beautiful clarity before you fell asleep last night. So you need to go ahead and get those fancy, embossed business cards you’ve been eyeing right?
Before you order a thousand business cards or invest even $1 into that million dollar baby you’ve just dreamed up, stop and breathe first. Then make sure you check off these four major to-dos below to get your start-up up and running on the right foot from the get-go. There is nothing worse than wasting both your valuable time and your hard earned dollars. If you really want to make your business idea happen, you need to be prepared.
1. Do your homework on your industry – and take note of the competition.
If this is your first rodeo into the crazy arena of entrepreneurship, it’s vital that you check out what already exists in the industry you’ve been eyeing. For example, social enterprises are on the rise and you want to bring your own idea of giving back to the table. Be sure it isn’t already being done by someone else, or do your homework social entrepreneur powerhouses like TOMS or up and comers like iFLIP4. Ask yourself:
• What are they doing that you could do differently in your industry?
• Could you make improvements with your company?
• Are there issues, tasks, or information you didn’t think of?
• What services will you offer that they can’t find anywhere else?
Utilize resources at your disposal and visit websites like SCORE that can give you a list of valuable and relevant contacts, business plans, and other information for burgeoning start-ups like you. Make sure that your homework and research has pinpointed your specialized area. Study the offerings of your competitors and what kinds of services they have available to their clientele.
For instance, imagine you are opening a new boutique advertising company. You’ll need to know what already exists in your area, what their pricing is (which might require some personal inquiry and moonlighting as a ‘prospective customer’ on their email list), as well as who their target market is. Remember your overall goal is to understand your competition so you can improve and do it better than anyone else out there.
2. Have a number of ways you might fund your dream.
This is probably the most important part of your venture. You have the idea, you understand your competition and know you can do it better, so now, how will you fund it to actually make it a reality?
• Are you able to get it off the ground yourself?
• Do you need to take out a small business loan?
• Are you looking for investors or venture capital?
• Will individuals be interested in investing in your company?
Don’t count any ideas for raising funds out. It’s best to have a number of options to sort through and deciding which is the best for you. You could check out the SBA Loan Program for a more traditional funding approach or consider the idea of crowdfunding your business through platforms like Kickstarter – which can also provide you with valuable information about your customer base and who is interested in your product based on their donations.
You can go the route of a professional or angel investor – a choice that nearly 80,000 new businesses made in 2014 to fund your start-up. Just be sure that you do your research on what type of investor would best for you, especially understanding their investment history and success/failure of those ventures.
3. Ask questions from close friends, mentors, those who have been there before you etc.
One of the most valuable things you can do for your start-up is ask for advice – from people you trust, mentors or people in the industry. If you’re a really savvy entrepreneur, you’ll understand that a mentor with experience in you industry is probably your most valuable secret weapon. Your mentor can not only give you pointers on how to successfully run your business (because they’ve been there before), but they can also increase your network or offer a listening ear. The whole point of mentorship is to help you avoid making some of the mistakes they made early on in their entrepreneurial career and guide you towards success.
You can also consider looking into a local business group in your area that provides support and valuable network information for their members to get your feet off the ground. A resource with a vast already established network of individuals, information and businesses in the area is an invaluable asset for an entrepreneur looking to begin their own venture.
4. Take your idea for a little test drive.
Once you’ve done the research and leg-work to understand your market and competition, know you can successfully fund your venture and have the necessary help and guidance to keep you from flailing around in the dark too much, take your idea for a little test drive to see how it does. Think of it as a ‘soft opening’ with the primary purpose of gathering information on product performance in the marketplace.
Feedback is your friend, and perhaps the most valuable asset to the preliminary stages of your start-up. It allows you to go back and revisit your ideas – tweaking here and there where you can make improvements. Make it super easy for yourself and use tools like Survey Monkey that allow you to send quick, short surveys to your customer base to collect this data, or take polls using your social media outlets on Facebook, Instagram, or Twitter. The overall goal is to get to know your customer base inside and so you can give them the product or service they want – and keep wanting in the future.
Getting that start-up up and running successfully is going to be a huge endeavor, but doing good research and laying the proper foundation before diving head first into spending your money, will give your great idea a much better chance of success and growth from dream to reality.