Let’s face it – starting a business is one of the most irrational decisions you can ever make. For every company that makes it – there are an estimated 1000 companies that don’t. The odds are never in your favor and the cliche of “I want to be my own boss” is a bunch of bull shit!
You will never be your own boss. You may not like to admit it but your customers, investors and users – will always ultimately be your boss!
You turn over a secure 9-5 job for a long period of stress, tension, debt, concerns, happiness, worries, sleepless nights, and possibly ruining many of the relationships in your life – for the opportunity to run your own show, mark your own dent.
Well, if that doesn’t scare you enough.. here are my top 15 steps (with detailed questions) you should figure out – prior to starting a business. (if you don’t – that’s okay – you will simply have to figure them out on the way..)
- Step 1: What is the problem you trying to solve? are passionate enough to be pursing its solution for a minimum of 5 years?
- Step 2: Researching your idea – competitive landscape, market opportunity. Is the problem wide enough? Can a viable business be built around it?
- Step 3: What is your product or service? What will your solution look like? How will it be different than your competitors?
- Step 4: Calculate risks – are there substantial barriers of entry? Does anyone already own intellectual property? Are you eligible to protect your solution with intellectual property? How easy will it be to copy you?
- Step 5: What is your business model? How will you make money?
- Step 6: Goto market strategy – who are your customers (early adopters, main market, late adopters)? How will you reach each group?
- Step 7: Lead generation – what resources can you use to find new clients? How will you qualify leads?
- Step 8: Sales pitch – what are your product’s benefits? What are your key messages?
- Step 9: Account management – who / how will you facilitate customer service?
- Step 10: Billing – what payment methods will you be supporting?
- Step 11: Accounting – How will you handle invoicing and reporting to the authorities?
- Step 12: Talent – how will you find talent? Who are your first hires? How do you plan to manage them?
- Step 13: Technology – what kind of technology will you need to employ in order to get your business going? Who will build your technology? Who will maintain it?
- Step 14: Legal – who will be your legal console? What legal issues might you encounter? What kind of securities and insurance do you need to set up?
- Step 15: Funding – what kind of capital do you need in order to setup the business? What kind of funds will you need to grow the business? Where will you get this money?
This list does not include all aspects of building a business. There are more factors like location and timing which are considered fundamental to your success, however in many cases their weigh is often considered more luck than knowledge.
In my next posts I will try to share with you how I answer these questions in greater detail (separate blog posts for each) hoping that you may capture some value from the lessons I’ve learnt in building several different businesses.