Starting a business is often a challenge for most people. At a recent conference where several startups were presenting their ideas to a remarkable panel in order to obtain funding, the following concepts came out clearly. First you have to come up with a feasible idea which must seem to be profitable. Next is the mountain that drives everybody crazy; capital. Finally you have to implement your idea since it will not materialize by itself. Just like starting a fire you might have lots of fuel and be full of air but you still need a flame to have a blast.
But before setting foot into the murky waters you must find out who your customers or target audience is. Collect all the statistics you can on your market since it’s always good to have the numbers on your fingers especially when making a presentation or a pitch to potential investors. Again there is always the issue of how your target customers will know of your product or service. Several marketing methods came out such as using social media e.g. Facebook or Twitter, face-to-face contact, posters, newspapers or even spamming (Sending information or URL links for your site to all the email addresses you can lay your hands on). The last method may irk some people but they will get the message anyway.
Another issue is how you will launch your product/service. Some products may be free during the pilot period followed by subscription if the initial customers liked what you had to offer. For example a dating site may let potentials send each other gifts and flirts before hitting them with a subscription fee once the “love ” starts running deep. On the same breath you must know how your business is going to rake in money. Some of the revenue streams out there include premium SMS messages, recruitment/joining fees and transaction fees especially for online businesses.
A business may also decide to advertise on their site with advertisers paying for their listings either per month or CPC (cost per click) i.e. they pay for every click on their advertisement. One fact that came out strongly was that a good business adds value i.e. customers should enjoy a new service that wasn’t there and is worth their money or the service was already there but it has added or unique features that drive customers to choose yours over others.
If your business relies on software you must check whether the software already exists and justify why building your own is better than buying say COTS (Commercial off the shelf software). Customization of other software especially Open Source software (Software that has a free License and can be altered and redistributed without copyright constraints) is also another option here. Assuming you are pitching your business you must give sufficient reasons that demonstrate your need for funding i.e. expansion to new markets, marketing, creating new products/services etc.
Finally, you must have exit strategies handy. An exit strategy is simply what you intend to do with your company once it becomes too large and powerful for a few individuals or when you encounter unfavorable conditions. Strategies include acquisition by new players, listing on the stock exchange or you can refuse with it until you die. In reality many startups don’t make it that far and it’s always good to “see” the progress of your business a number of years into the future especially if your main business activity ceases to be profitable. This ensures sustainability. Also getting your idea out there is always a good thing since you may get new perspectives and improve the idea or even catch the attention of an angel investor. Some people might argue that their idea may be stolen and choose to develop in stealth mode but the truth is for every idea you conceive there are hundreds of other people toying around with something similar.
But before setting foot into the murky waters you must find out who your customers or target audience is. Collect all the statistics you can on your market since it’s always good to have the numbers on your fingers especially when making a presentation or a pitch to potential investors. Again there is always the issue of how your target customers will know of your product or service. Several marketing methods came out such as using social media e.g. Facebook or Twitter, face-to-face contact, posters, newspapers or even spamming (Sending information or URL links for your site to all the email addresses you can lay your hands on). The last method may irk some people but they will get the message anyway.
Another issue is how you will launch your product/service. Some products may be free during the pilot period followed by subscription if the initial customers liked what you had to offer. For example a dating site may let potentials send each other gifts and flirts before hitting them with a subscription fee once the “love ” starts running deep. On the same breath you must know how your business is going to rake in money. Some of the revenue streams out there include premium SMS messages, recruitment/joining fees and transaction fees especially for online businesses.
A business may also decide to advertise on their site with advertisers paying for their listings either per month or CPC (cost per click) i.e. they pay for every click on their advertisement. One fact that came out strongly was that a good business adds value i.e. customers should enjoy a new service that wasn’t there and is worth their money or the service was already there but it has added or unique features that drive customers to choose yours over others.
If your business relies on software you must check whether the software already exists and justify why building your own is better than buying say COTS (Commercial off the shelf software). Customization of other software especially Open Source software (Software that has a free License and can be altered and redistributed without copyright constraints) is also another option here. Assuming you are pitching your business you must give sufficient reasons that demonstrate your need for funding i.e. expansion to new markets, marketing, creating new products/services etc.
Finally, you must have exit strategies handy. An exit strategy is simply what you intend to do with your company once it becomes too large and powerful for a few individuals or when you encounter unfavorable conditions. Strategies include acquisition by new players, listing on the stock exchange or you can refuse with it until you die. In reality many startups don’t make it that far and it’s always good to “see” the progress of your business a number of years into the future especially if your main business activity ceases to be profitable. This ensures sustainability. Also getting your idea out there is always a good thing since you may get new perspectives and improve the idea or even catch the attention of an angel investor. Some people might argue that their idea may be stolen and choose to develop in stealth mode but the truth is for every idea you conceive there are hundreds of other people toying around with something similar.
