How to start and Organize your Startup – Initial Steps be Considered
To start one’s own business, a startup, is a dream of many people today. It is good to see dreams and then follow them as well. What you need is to make sure that you have a clear vision and a proper plan to execute your idea.
In this era of technology, some people prefer to do invest and do online business, while others opt for offline businesses. There are advantages and disadvantage in both cases, but it’s more about personal circumstances, interests, and preferences. Whether you are starting an online business or an offline one, you have to take care about some basic points that we are going to discuss in this article.
Before you start a startup, ask yourself the following questions:
- Are you are offering something that people actually want and they are ready to spend some money for it?
- Do you have good people to start your work with?
- Do you need small amount of investment?
If “Yes” is your answer for all the three questions, then congratulations! Most probably your startup will be a success. But if in anyway, there is even one NO in three of your answers, you should have a look on your plan again. None of the three points is rocket science. You may have sleepless nights, restless days, but at the end of the day, everything is doable.
Now we will discuss some major issues that most of the people face, who want to start their own business.
- Idea Evaluation:
You may have thought of starting a business because you have some ideas in your mind that you think you can make money with, or maybe you got an idea about a better product that is already making some money. The most important thing before converting an idea into a business is to evaluate it. Now the question is how to evaluate an idea? You can easily find answer of this question by answering following simple yet important questions:
- Do people really need your idea? What are its advantages for them?
- What exact problems your idea is going to solve for people?
- Have you adapted the idea from somewhere? Or you have come with a unique and a new one?
- What immediate results should people expect from your idea?
- What risk factors are involved with our idea? And are they acceptable?
- Is the execution of your idea easy or complicated? And at what extent?
- Does the market have customers for your idea? Are they willing to spend money to buy your idea? Have you done a good market research?
- Do you have competitors? What are they offering? Can you compete them? How can you serve your customers better than your competitors?
- Have you considered the difficulties you may have to face in executing your idea?
- How much time will it take to put your idea in operation?
- Are you passionate about your idea?
- Will your idea help you in making money?
- If yes, how fast?
- If no, why do you want to execute this idea?
- Create a Business Plan:
After evaluating your idea, your next step towards your start-up is to create a business plan. A well-thought-out business plan is an important thing for any new business. While making a business plan, you should:
- Research about your potential customers and possible competitors
- Avoid making mistakes that can make your start-up unsuccessful
- Know how to execute a business plan successfully and make it work
Now we will look at the basic steps of writing a good business plan:
- Basic Components of a Business Plan:
Each and every good business plan should have some basic sections. Make sure you include the following sections in your plan of start-up:
- Company Overview
- Company Description
- Company Strategy
- Executive Summary
- Business Environment
- Financial Review
- Action Plan
- Financial Statements for your Start-up:
This is one of the most important part of your business plan. This segment includes all short term and long term financial condition of your business. Four basic financial statements that you have to include in the plan are:
- Budget – this is the place where you record your plan to earn and spend money
- Income Statement – the net profit; subtracting all your expenses from your revenue
- Balance Sheet – It is a financial summary of the worth of your company, what you own, and what you owe
- Cash Flow Statement – here you record the flow of cash in and out of your start-up
Financial statements are actually formal financial records of your company.
- Writing your Business Plan:
In a successful business plan, potential customers and competitors are clearly identified. To identify your customers, ask three question:
- Who is buying your product?
- What are they buying?
- Why are they buying?
When it comes to competitors, your questions should be:
- How big are your competitors?
- Which customers are they targeting?
- What strategy they have adopted?
You can easily snatch customers from your competitors, by:
- Cut your cost to the bone
- Offer something new to your customers
- Focus on customer groups
Business plan of your company is actually a strategy that is prepared by understanding your surroundings, and then gives a future picture of your company.
- Establishing your Company:
After writing the business plan and researching for your customers and competitors, the next step is to establish your company. Establishment of a company depends on the country and/or State you want to register your business in. Establishing a company plays a role, even minor, in a country’s economy, and that is why, most of the countries have made easy procedures to get a company registered.
There are some firms that help people in establishing their start-ups. You can hire the services of any such firm, or a lawyer may also help you in this regard.
- Raising Money:
An important thing that we haven’t discussed yet in the process of setting-up and starting a start-up is Money. The money that you require to give your idea the shape you want to see it in. Some of the start-ups are self-funded, for instance, Microsoft, but many are not. A smart move is to add a partner who is willing to invest in your business, or in other words find an investor.
Finding an investor is not a very difficult task. When you have a good idea that actually can make money, you can find an investor with a little hard work. Brain storm your idea, put efforts in the business plan and then convince people who are interested in our idea to invest with you and become your partner.
- Engage Advisors and Serial Entrepreneurs
As important as hiring a good team is to have in your team one or more serial entrepreneur who went through the process of starting a company, building it and existing from it by way of a merge/acquisition or otherwise. Companies like Cytex managed by people who built multiple tech startups are a great solution
Starting a start-up is not a monster. Unfortunately, many people get terrified even with the thought of starting a new business, but fortunately, it is much less complicates as it looks like form outside.