Beginning a business is among the riskiest things you can do. It’s exciting, hazardous, and filled with potential. Yet your very first decisions make you successful or not. Too many get stuck on the superficial aspects of business cards, logos, social media before they’ve done the hard work of validating their concept, researching their marketplace, building a lean core.
If your business is to succeed and prosper, you have to begin with strategy, not passion alone. That is what this guide boils down to – all you need to know to launch with clarity and confidence.
Table of Contents
Start With a Real Problem
The vast majority of business failures happen because you’ve tried to fix a problem that doesn’t exist. Your idea sounds great, but if no one is interested enough in paying for it, you are dead in the water.
Don’t ask “What should I sell?” but rather “What problem can I solve for individuals who are already trying to solve it?”
Listen to others. Not your relatives or your buddies, but anyone you can locate. Ask what they dislike, what bothers them, what they pay for right now. Look for similarities. If five of ten speak of the same issue, you have a winner.
Once you’ve identified a real problem, devise a concise, definitive solution that can be encapsulated in a one-sentence summary.
If you cannot accomplish that, your offer isn’t quite right.
Validate Before You Build
Validation is about verifying that people will pay you before you create a full version of your business. This step keeps you from wasting time, money, and heartache.
Here’s what you can quickly validate:
- Create a bare-bones version of your offer. It can be a solo offer, a rough product prototype, or a Google Form testing interest.
- Sell it to your target market. Approach people one on one. Share it on social media groups or a forum where your target group congregates.
- Sell it. If people pull out their wallet, regardless of what amount, you have proof.
If no one’s buying, that’s feedback. Adjust your offer, price, or position and test again.
Know Your Numbers
You can’t be a successful business person if you are not business-savvy financially. A small business can be successful as a decent-size business only if your figures are correct.
- Start by calculating: Startup costs: what will it take to get started? This can be for equipment, software, inventory, lawyers’ fees, and advertising.
- Monthly expenses: Hard costs like rent, subscriptions, utilities, variable expenses like material or freelance help.
- Revenue goals: How much must you generate each month to break even as well as pay yourself?
Work backwards from there. How many monthly sales would you require in order to accomplish that level? At what price point? This gives you a clear sales target and allows you to figure out if your model is sustainable.
Choose a Suitable Business Model
Your business model dictates how you make value as well as get paid. A great idea with a bad model can get into trouble fast. Some very simple models are depicted here:
- Service-based: You trade time or expertise for dollars. A few examples include consulting, freelancing, or coaching.
- Product-based: You offer a physical or digital product. This could be handcrafted goods, software, or printables.
- Subscription-based: Customers pay on a recurring basis. It is a good strategy for regularity but hard to get started with.
- Marketplace or platform: You connect buyers with sellers and take a commission. Harder to design but scalable.
Choose a model that fits your target’s desire for purchase as well as your desire for what you want to be doing. If you detest pursuing one-on-one clients, design a product that creates repeat revenue. If you crave fast feedback, design a one-time service you can rapidly iterate on.
Keep Your Brand Simple
Branding matters, but not for reasons you would think. You don’t need some fancy logo or a full-site day one. You only need clarity.
That’s what a minimum brand is:
- A catchy business name that’s memorable and can be easily spelled
- A concise one-liner that tells what you do and for whom
- A clean one-page website or landing page with a call-to-action
- Avoid costly design efforts. Utilize free or cheap software. Primarily, what is important is that others know what you have to offer and where they can purchase it.
Get Your Legal and Financial Setup Right
This section isn’t thrilling, but it saves your business and your sanity.
- Choose a business structure. For a standard small business, an LLC would be a good starting point. It offers protection from liability with a low amount of paperwork.
- Register your business name with your state or local agency.
- Get an Employer Identification Number from the IRS. It is free of charge and can be used for opening a business bank account.
- Open a distinct business checking account. Never mix your business funds with your own.
- Create basic bookkeeping. Use simple software like Wave, QuickBooks, or even spreadsheets to track expenses as well as revenues.
- Sorting your finances out sooner rather than later will pay dividends in the long run, especially come tax time.
Focus on Getting Customers
Once you’ve established your offer and your fundamentals, your only work is to get customers. That is, selling.
Don’t get sidetracked with follows or likes. Marketing only helps if there are sales resulting from it. Targeted outreach and minimalist messages must take primacy.
That’s how you attract your first customers:
Tap into your network. Be concise. Don’t say “I started a business.” Say “I’m selling this service for this amount. Do you know anyone who can use it?”
Offer an early-bird rate or reward. Create a reason for people to take action immediately. Ask for referrals and endorsements right after you’ve given value. Be scrappy. Post on community bulletin boards. Cold email or DM people. Offer deals. Ask for feedback. Iterate and repeat. The goal isn’t just to sell once. It’s to start a repeatable sales process.
