Got an idea for a startup, but aren’t quite sure how to get started? Well, you’re not alone. Many founders-to-be struggle with the sheer volume of information out there.
Fortunately there’s some basic steps you can follow to learn the ropes and determine whether your idea has promise. The following tips build upon the ‘Advice to future founders’ in the Startup Muster 2016 report.
1. Learn some business basics
If you don’t know a partnership from a company, the basics of intellectual property or think a ‘cap table’ belongs in a retail store, you’ll want to learn a few business concepts first. The goal isn’t to become an expert in everything, but rather to understand enough to ‘know what you don’t know’. That way you can identify the areas where you need specialist legal, accounting and other advice before you make decisions.
Further reading: LegalVision Startup Manual
2. Define your business model
Often when I’m told about new business ideas by aspiring founders, their thinking is limited to the product or service only. However, that’s a small piece of the puzzle and matters little on its own. A business model considers other things such as… your value proposition… who your intended customers are… how you’ll find them… how you’ll make money. Defining a business model helps you understand all the parts which need to come together cohesively.
Further reading: 5 tips for developing a better business model
3. Do some market research
Technological, regulatory and social shifts can all impact the prospects of a startup, both positively and negatively. Just look at how digital disruption impacted huge players like Kodak, Blockbuster and Borders.
It’s clearly valuable to understand the industry, market and competition you face. Without a finger on the pulse it’s easy to make the wrong decisions. Founders often feel that in the early stages these macro factors don’t apply to them. While its true to an extent – these factors may not constrain you from achieving the first few customers – they become vitally relevant when you’re struggling to achieve growth and realise you’re operating in a shrinking niche.
Further reading: How to do market research for your business idea
4. Validate your idea
Entrepreneurs are passionate about their ideas. They have to be. But the down side of this passion is often the rigid thinking about how the vision needs to be achieved. It can result in building something no one wants or even missing a bigger opportunity that’s only one step removed from their thinking.
Validating your idea is all about providing evidence that you’re heading down a path with promise, before you get too far along. Is what I’m planning really going to meet a need? It’s worth emphasising because so many new founders work away on their product for a long period, only to find that it doesn’t sell. Even those adopting Lean Startup principles can find themselves building a platform before they actually need to. Before they really understand if they’re serving the right customer segment with the right offering.
Further reading: How to validate your startup idea
5. Develop a plan
In this sense I’m referring to a project plan. Whether you like Gantt charts or Kanban boards, a bit of preparation goes a long way. It won’t guarantee success but it will help with prioritisation and focus. Some of the important considerations are:
- What’s your overall vision for the impact your business will have?
- What are the goals and measures of success?
- What tasks need to be completed and in what sequence?
- How long will they take?
Developing a plan will ensure you know what you’re aiming for, how you’ll get there and whether you’ve arrived. Be prepared for the plan to evolve over time as you learn and adapt. Blindly following a bad plan will waste a lot of time and effort.
It’s also easy to overlook the value of your time. Consider the tasks which are time-consuming and tedious for you, which others can do more cheaply and easily? Utilising virtual assistants and freelancers may help focus your effort on the higher value activities.
6. Get the right people around you
Building the plan will highlight that you simply don’t know everything. That’s why it’s vital to build a support network. Friends, family and colleagues all play a role but more relevant experience may be found through startup meetups and social media groups.
In building your plan, you need to consider who’s going to do the work. If you can manage it between you and your co-founders, that’s great. The alternatives are to:
- Find co-founders – it’s rarely sensible to rush into a co-founder relationship. Finding people who are equally committed to your idea or vision is difficult.
And a technical co-founder shouldn’t be thought of as arms and legs to get your platform built. This de-values their contribution and voice in the direction of the business as a founder.
- Outsource development – this requires seeking out people who’ve done similar work before and have done it well. Founders should be actively engaged in the process and prepared to provide clear direction and feedback. For these reasons, it’s beneficial to at least understand the basic concepts and process involved in the work you’re sourcing. This way you’ll be easier to work with for the service provider and informed enough to call them out when something doesn’t seem right.
Of course, there’s also the broader network of people who can help such as mentors, co-working groups, incubators and accelerator programs. It’s important for your supporters to bring appropriate expertise for the stage of business you’re at.
7. Get your life in order
Most founders will need to prepare themselves before embarking on the journey of entrepreneurship. It’s easy to get derailed by inconsistent effort, lack of funding or a decline in health and wellbeing.
Preparation can involve carving dedicated time out in your schedule to work on the business, making sure you’ve got enough money stowed away and building key relationships. Also consider that Australia’s average founder age is between 35 and 40. And 25% of founders also hold a job outside their startup. For many of us, starting a startup requires working through a whole series of financial and family considerations beforehand.
8. Execute the plan… and adapt
And here’s the hardest part. Sure it relies upon sustained effort and commitment through the times when it feels like nothing is going right. Celebrating the wins, learning from the missteps. But it also involves being flexible about the path you take to achieving the vision.
“Many of life’s failures are people who did not realize how close they were to success when they gave up.”
– Thomas Edison
P.S. If you’re struggling with how to get started, feel free to ask a question via our Contact page. There are usually options available, even with life circumstances in the way or without technical skills.