Thousands, if not millions, dream of setting up and running a business of their own. However, only a fraction of those people can realize their dream of running a successful business. There’s a lot of thought, planning, and getting around the red tape that goes into getting a business off the ground. This can seem complicated and quite intimidating to someone who doesn’t know where to start.
This guide is designed to help you get started in pursuing your ambition to be your boss.
1. Brainstorming an Idea
Every business needs a premise. Your idea is the premise of your business – and the foundation you build on – to make a viable product or service that attracts customers.
As the great Plato put it, “Necessity is the mother of invention.” To build a successful business, you must recognize the need for a solution to an existing problem. Once you’ve identified a problem, think of ways you can solve this issue.
If there are existing solutions to a problem, brainstorm ways to refine the process and make it better. The goal is to think of the most efficient way of solving the problem at hand.
2. Examining Your Options
Coming up with ideas is only the beginning of the process we just talked about. By process of elimination, figure out which of these prospective solutions is the most viable. When deciding on the best way to solve the problem, keep these pointers in mind:
- Market and potential for growth
- Seed capital
A business is only as successful as you make it. Building a business is like caring for a child and requires your constant attention and nurturing.
Spend plenty of time thinking of how a prospective solution can tick all the right boxes and don’t scrap an idea simply because it may not be achievable in the immediate future. Save it for later when you’re able to grow your startup into a flourishing business.
3. Researching the Target Market and the Competition
These are terms we’re sure you’d have come across if you’ve been thinking of setting up a business. They’re all inter-related and essential parts of bringing your dreams of running a successful start-up to fruition.
The first step in this phase of starting a business is to research the market and identify a target market that you are looking to cater to. Every target market is unique and has its nuances. While it is possible to market to a reluctant audience, you should understand who your product or service will appeal to for a better chance at success.
Having identified the target market, start researching the competition with the same target market as you. Competition is not necessarily a bad thing. Do your homework to see how your potential competitors brought their products to market and learn from mistakes they might’ve made along the way.
4. Building Prototypes and Minimum Viable Products
A minimum viable product or MVP is a working prototype of your idea. This doesn’t necessarily have to be polished right from the start, but you should focus on the essentials that make the product useful.
Consider the seed capital you have to work with and design several iterations of the prototype, each time refining it to make it more marketable to investors.
5. Writing a Business Plan
If you’ve managed to come up with one or several versions of your prototype that can demonstrate the use-case of your idea, pat yourself on the back! We can now begin designing a business plan.
Your business plan is the blueprint you will use to create a pitch and present your idea to potential investors for their consideration. Start with a rough business plan and then polish it and make it a formal document that includes the following:
- The Executive Summary
- Target Market Analysis
- Product or Service
- Marketing and Sales Strategy
- Financial Projections
- Request for Funding
This is a non-exhaustive list of factors you should include in your business plan. We recommend doing further research using online resources to write your business plan if you want to pitch your idea to potential investors.
6. Incorporating Your Business
The last and final step is to decide what business structure is ideal for your business. The following are your options and can differ based on which jurisdiction you decide to incorporate your business in:
- Sole proprietorship
- Limited liability company
One of the primary factors of distinction between these types of business structures is the extent to which the liability of the business can be extended to you and your assets.
Hiring a lawyer or using a business service platform will simplify the process of getting around the red tape and ensure that you’re meeting all the legal requirements to set up a business. These requirements are specific to jurisdictions and can vary a lot depending on where you reside. Getting a lawyer’s opinion on how to go about doing this is a great way to make sure you’re doing everything right.
Following these major steps can be challenging at first – but if done right, the rewards can far outweigh the effort that went into setting the business up.
Remember that starting a successful business is a long-term sustained effort that requires your unwavering time and attention. We hope this guide has helped, and we wish you the best as you undertake this journey of building a business!
About the Author:
Judy Fitzgerald is an accountant in North Carolina. After spending some time in public accounting and then consulting, she noticed how financially illiterate people were. Hence, she started writing about crunching numbers and the performance of financial markets in order to educate people that need help.