Starting your own business can be a daunting prospect, especially if it’s your first time. Fortunately, you don’t need a business degree to take the plunge. In fact, there are many great resources out there to guide you through each step of the way. This article will provide you with an all-encompassing toolkit for starting a business, including access to in-depth courses and detailed definitions that will neatly walk you through the process of how to build and grow your startup.
You’ll find a comprehensive breakdown of each stage of the startup journey, including idea, planning, launch, growth, and scaling. Read on and be inspired to kickstart your business idea and turn it into a reality!
Do you have what it takes to start your own business?
Every successful startup began in the same place: With a great idea. But even though you need a great idea to build a startup, there is a lot more to it. The founder’s decisions and character (S) are what truly determines a startup’s success and longevity.
So what kind of characteristics describe a successful entrepreneur?
You know how to act by prioritizing your work and planning your days
You’re not afraid to fail, and you get back up – every time you do so
You care about solving problems
You’re motivated and keep going even when you’re not
You’re okay with uncertainty and willing to take risks
There are many great resources out there to delve a bit deeper on this topic, but we highly recommend checking out this article 👉 Do You Have What It Takes To Be An Entrepreneur? It will provide you with a great rundown to help you decide whether you have what it takes to start your own business.
How do you find the right idea?
Great idea generation doesn’t just occur by chance. It’s a considered effort by entrepreneurs to connect solutions to real-world problems. An excellent place to start is to identify a problem that frustrates you in your everyday life.
If you have a problem in mind, you can then start to consider these questions:
What pain does the problem cause?
Who is affected by the problem?
How many people are affected by the problem?
Can you visualize the problem with statistics?
Once you’ve found out if the problem is worth solving, you can frame it with a problem statement. A problem statement is a concise description of an issue to be improved upon.
Once you’ve framed the problem, it’s time to frame the solution. A solution statement needs to address the following points:
What is your solution offering?
Are you actually solving the problem?
Does the solution create a viable business model?
Is your solution different or unique from your competitors (Unique value proposition)?
Your solution statement should engage your audience in a way that doesn’t bore the reader with long-winded, technical language. Instead, it should be short and punchy and explain precisely how your solution can relieve the pain felt by your potential future customers.
To see what it looks like to bring the problem and solution statements together, here is an excellent example of how Netflix addressed them:
Problem: “Going to the video store requires fighting traffic, wandering the aisles, and waiting in long lines just to get a single movie.”
Solution: “Netflix allows anyone to enjoy thousands of titles streamed directly to their home or delivered to their mailbox.”
The next step in the startup process is to validate the idea you just came up with to determine if it’s viable enough to bring out into the real world.
How do you validate your idea?
Validating your idea is crucial to understanding whether that great idea of yours is also considered a great idea by other people. It will also assist you in gaining important, critical feedback from your target groups.
Idea validation is an excellent data gathering exercise to determine whether or not your eventual product is good enough to be developed while also providing some early indicators into a potential market fit.
The steps below are designed as a quick reference to assist you in the idea validation process. For a comprehensive rundown on idea validation, check out 👉 How to Validate Your Idea.
1. Ask people about the problem
Start with people you know, like family and friends, to get a sense of the quality of your idea. Once you’ve tested your idea on them, bring it to those who will provide the best feedback – your expected target group. These are the people that you think are experiencing the problem you’re trying to solve.
2. Build a Minimum Viable Product (MVP)
This can take the form of a sketchUp, wireframe, mockup, or prototype. Don’t worry about building your finished product at this stage just yet.
3. Test the MVP on your expected target groups
You can test your MVP through interviews and/or focus groups. Make sure you prepare open-ended questions that enable discussion as well as follow-up questions. The aim is to gather as much valuable data as possible to analyze in the next step. You could also present your mockup on a landing page and have people subscribe if they like what they see. This way, you can determine how much interest there is out there for your product.
4. Analyze the results to build your product
Listen to the valuable feedback you have just received. Dig deep into the results to determine whether your solution is perfect (well done to you if it is, but this is usually very unlikely) or if you need to make any minor or major adjustments (very likely).
To be able to complete this experimentation phase of your startup, you need a source of money. It’s not usually possible to find investment from investors at this early stage just yet, so an alternative strategy is to bootstrap.
Bootstrapping is using your savings to kick-start your business with little or no outside help. It usually involves tightening your budget/expenses in your life to accommodate for the money needed to finance your startup’s development.
To find out everything you need to know about bootstrapping and how to do it, check out this article 👉5 Ways to Bootstrap Your Business.
The idea stage has given you all the information you need to build your product, so it’s time to do just that, build it! Where do we go from here? Time to get Planning.
1. Find a Co-Founder
Some founders decide to go alone, while others choose to seek out a partner in crime. While the solo route might seem like a good challenge in which you have complete control of your startup, we, along with the mountain of evidence behind it, strongly advise against doing so. Here are three reasons why:
According to Startup Genome, Co-founding teams grow their customer base x3 faster than solo founders.
Shared responsibilities translate to a shared workload, stress load, failures, long nights, and shared successes. It dramatically reduces the chance of burn-out, leading to improved mental health and overall productivity.
Investors prefer investing in startups with two or more founders. Those startups receive as much as 25% higher seed valuation than solo-founder startups, according to the 10-year project report by First Round.
If you want to find out more insights into the benefits of partnering up and what characteristics to look for, and where to find a co-founder, check out 👉 Partnering Up! Find a Co-Founder for Your Startup.
2. Write a Startup Business Plan
The business plan is the backbone of your company. It encompasses everything about your startup for you to secure funding from investors (find out more about securing early-stage funding here 👉 How To Get Seed Capital And Avoid Early Startup Death. Your business plan also acts as a tool for you to prepare, control, and grow your startup into the future. There are 11 essential sections to include in your business plan. They include:
Risks & Challenges
Above, we’ve briefly introduced the business plan sections, but there’s much more to discover. Check 👉How to Write a Startup Business Plan.
3. Create your pitch
There’s no denying it; your pitch is one of the most crucial parts to get right. A pitch is intended to show the potential of your business by presenting an intriguing and informative overview of why investors should give you and your startup funding.
You can find a good article on pitch structure here 👉 How To Create A Startup Pitch That Gets You Funded. It will give you a complete 13 step guide to building your pitch. It also has some great additional tips and resources like how to find investors and what qualities investors are looking for, as well as examples of pitch decks from a variety of startups.
A final projection of the future is also useful to help investors understand how your sales will be forecasted. Make sure your estimates are accurate and based on real data, not just numbers plucked from thin air.
If you want more information on sales forecasting you can take a look here 👉 How To Use Sales Forecasting To Grow Your Business.
You’ve generated and tested a great idea, meticulously planned everything about your startup, found funding, and now you are ready to launch. But first, you need a pre-launch strategy.
To make sure you get the best out of your launch, you need to be prepared. Don’t assume everything will fall into place once your product or service is available. You want a marketing plan that will create a buzz and enable future sales before launch.
You can find out more on pre-launch strategy here 👉 Building A Kickass Pre-Launch Strategy.
Once you’ve strategized your pre-launch marketing angle, it’s time to think about metrics. Metrics are the numbers that, once you’ve launched, will guide the future decisions you make for your startup.
There are endless ways to measure the trajectory of your startup, and which type of metrics you choose to prioritize is up to you, depending on your business and goals. There are, however, some tried and trusted metrics that almost all startups will utilize. Some of them include:
Channel activity (email marketing, online advertising, etc)
Public Relations (PR)
Churn rate and retention
If you want to know more about each of these metrics, take a look here 👉 Want A Great Launch? Set Up Key Metrics.
Find a great rundown on everything you need to know and do when it comes to launching your startup here 👉 You Are Ready. Now Launch!
Pivoting is when you change something that isn’t quite working the way you had expected. It would be best if you always kept the option of pivoting close in mind.
Having a flexible outlook of your startup will prevent you from being stuck on one track. Having tunnel vision when your startup is not quite doing what you expected can be detrimental to your growth.
There is a great tool to use when deciding to pivot called the pivot pyramid. You can find it in detail in this article 👉How To Pivot Your Startup and looks like this:
The pivot pyramid breaks up your startup into 5 parts; customers, problem, solution, tech and growth – and then helps you make decisions on pivoting in each area.
Now you’ve launched your startup, it’s time to get your growth on!
Most founders opt for equity funding to speed up growth. The capital is used to improve their product further, hire talent and build their dream team.
Make sure that when you do hire talent for your startup, that you don’t only hire for skills. It’s important in the early stages of growth that your team members have a go-getter attitude. Skills can be learned, attitudes can’t. To find out more, check out 👉Hiring For Skills Will Kill Your Startup.
Want to know more about startup funding? This course will teach you all you need to know about 👉The Art of Startup Funding.
Growth stage complete, time to scale-up!
If you’re at the scaling stage, congratulations! But what exactly should you think about when scaling?
Knowing when to scale your startup is a crucial aspect. How do you know when you’re ready to scale? These signs will help you:
You have proved the concept
Your infrastructure is solid
You are turning down customers
You are reaching goals without maximum effort
Your cash flow, not just your profit, is strong
You have the legal elements sorted
To find out about scaling and as well as more information on when to scale, take a look here 👉Knowing When to Scale Your Startup.
So you’ve made it! Your great idea has been planned and launched, and it has experienced exceptional growth to the point of scaling. You’ve officially reached the top of the startup mountain!
Interesting Related Article: “What is a startup? Definition and examples“