Starting a brand new business is always difficult. You may have funding issues, employee issues, supply and inventory issues, shipping, etc. There are a multitude of different problems that you could have and being unprepared or uninformed is a sure way to make sure that your business joins the other 90% of startups that fail.
Here are some ways to help you out in beating those odds of failure.
Develop A Solid Business Plan
It doesn’t matter what industry your startup is in. Having a business plan isn’t just something that you can create and use to convince others to give you funding. It’s a crucial document that reminds you of how your business is organized.
You’ll use this document to lay out milestones for progress, the direction you want to go in to reach those milestones, and keeping track of what’s been working and what hasn’t.
Don’t overlook the importance of having a business plan put together before you get serious about your startup. It increases your chances of success exponentially.
Pick A Location
When you start your business, you’re going to have to have a physical address whether you want to or not. It’s tempting when starting businesses that primarily operate online without a physical address, but you have to have one for various reasons.
Your website has to have a physical address attached to it for the purposes of ICANN, which is who keeps track of who owns domain names.
You’ll also have to have an address for things such as Google My Business, your contact information on your website, to receive physical mail, and to give your potential customers and investors a reason to trust you. No one likes a ghost website that doesn’t have any real names and addresses attached to it.
Have A Great Website
Your website should be well designed and well organized. It doesn’t have to be fancy and you don’t have to spend $5,000 on getting it set up initially, but the better it looks, the more you’re going to impress customers and potential investors. A professional website with all the right trust signals, such as an SSL certificate, BBB membership, etc goes a long way towards earning business and funding.
Do Something You Like
There may be a lot of money in your startup idea, but do you like doing it? Are you just in it for the money? While some people can maintain focus on a project just for the sake of the money, most cannot. If you’re going to be spending this much time and effort on your startup, it needs to be something that you can either be or get passionate about. This leads us to the next point…
If you’re not motivated to succeed with your project, you won’t succeed, even if you go through all the right motions. Investors can tell whether you’re “all in” on your startup or not and they’re not going to be interested in helping you with anything if they sense that you’re “off”. If you’re not happy with what you’re doing, figure out why that is and either fix it within your current startup or abandon this project and do something else.
Avoid Toxic People; Hire Positive Influences
Toxic people can bring down a business fast. It doesn’t matter whether it’s friends, family, employees, subcontractors, or even investors. People who are a drain on you mentally and emotionally have no place in your startup.
People who have positive attitudes are an asset to your business and they should be sought out. You want people around you who aren’t too easily discouraged and will continue to push with you through the growing pains that any startup will have.
Don’t Hire Friends Or Family
It sounds like harsh advice, but this is a fairly big one. Hiring friends and family should be avoided because you will let them get away with things that you wouldn’t let employees or subcontractors get away with and you’ll let them get away with it longer.
If you decide to hire friends or family for some reason, set hard rules and expectations. Be prepared ahead of time to deal with relationship issues if things go sour.
Be Able To Take Criticism
Because you’re going to get it whether you want it or not. Friends, family, employees, subcontractors, and especially investors will be all about telling you what they think. Develop a thick skin for this and do it quick. Everyone has an opinion, especially people who have never been in your shoes before.
But, don’t discount their opinions and advice. Research things people tell you and decide their usefulness after you’ve done your research. Sometimes you’ll get good advice from odd places.
But Don’t Just Go With The Standard Advice
Conventional wisdom isn’t always the way you need to go. If a piece of conventional wisdom doesn’t sound like it fits what you’re trying to accomplish, research and see if it fits or not. Sometimes breaking outside the norm is what’s needed to garner truly outstanding results.
Be Willing To Take Risks
If you’re not growing, you’re dying. Sometimes stepping outside of your comfort zone is required in business and as a startup, you’re going to be doing a lot of that. Don’t make rash, uneducated decisions, but don’t be afraid to execute once you have enough information that something will work.
The enemy of today is tomorrow.
It’s easy to say “I’ll do that in the morning” or “in a few minutes”, but the end of the day will creep up on you fast and before you know it, it’s 10pm and you’re setting your alarm for 4am to make up for what you didn’t get done today. Then, you hit that snooze button and sleep until 8 because you’re tired.
Don’t pile more things up for you to do tomorrow when your plate is probably already full as it is.
You should be researching all aspects of your business plenty and often. If you’re not sure about the answer to a question or a problem, don’t worry, because it’s 2020. Google it. YouTube it. The answer is there somewhere. If you can’t find the specific answer you’re looking for, find an industry-relevant forum and go ask someone there.
You have the modern day Library of Alexandria in the palm of your hand, all day, every day. Use it.
Brand Yourself Well
Your business name is absolutely crucial to your success. Your business name should elicit good feelings from people who hear it. These feelings can be happiness, calm, security, efficiency, or anything else generally considered “good”. When it comes to tech startups, sometimes going for something edgy or even some level of intimidating can be good.
Look your chosen business name up on Google and make sure no one else is using it first. If you’re clear on that front, then you can start the search for a domain name.
A big thing with this is that no matter what you name your business, make sure that a domain name is available for it. You want a .com for this, but if that’s not available, you can go with a .net or some other domain extension that makes sense for your business.
Know What Your Customers Are After
What do your customers need? What scratches their itches? What are their problems? These are questions that you need the answers to if you’re going to succeed in providing them what they’re looking for.
Pay Attention To Customer Preferences, Not Yours
What you like and think is cool doesn’t matter. Think of it this way: if you run a restaurant, it doesn’t matter if you don’t like cheese on your salads. Odds are very high that if you serve average people in the United States, your customers do. Because of this, the idea of refusing to serve salad with cheese on it is ridiculous and you’re shooting yourself in the foot if you do.
Take this example and apply it to your startup. Examine your own preferences that you’re inserting into the business and don’t let those preferences interfere with what the customers can choose.
Making plans is great, as we covered in the section on business plans. But, don’t let making plans consume you to the point that it paralyzes you. The purpose of planning is so that you can efficiently get things done, so don’t let planning get in the way of action.
Raise Enough Money To Accommodate Those Plans
If you don’t have enough money to execute your plans, you’re not going to make it. How much money you will need will vary depending on what industry and niche that you’re in. Be realistic with how much cash flow you expect to be able to generate when you open for business and calculate your expected expenses carefully.
When you finally come up with a number that you think will take care of your expenses until you’re profitable, multiply it by 130% to give yourself some extra cushion. Things will definitely cost more than you think and take longer than you want. Print that phrase out and stick it on the wall; you’re going to need it.
Learn Marketing Tactics
Marketing is king. You can have the greatest business plan and all the money in the world, but if nobody knows about your startup but you and mama, you’re going nowhere. You have to learn how to send your products and services out into the world and get them to the people who need them.
This is done through various types of marketing, including:
- Social media marketing
- Pay-per-click advertising
- Email marketing
- Content marketing
- SEO (Search Engine Optimization)
- Radio ads
- Newspaper & Magazine Ads
If you don’t feel you’ll be good at this, you can always hire someone else to do it for you.
Be Ready For Change
One thing that you can always count on is that things will definitely change at some point and you’ll have to be ready when they do. Get your finger on the pulse of our industry and know what’s coming, whether good or bad. If you don’t keep up with it, you’ll get blindsided and once that happens, it’s hard to recover.
Make Friends In Your Niche Online
Find Facebook groups, forums, subreddits on Reddit.com, and other online communities that are related to your industry and make friends with people there. It’s even better if you can hang out where you know your customers hang out online so you can get a better idea of what they want and need.
You’ll find not only customers like this, but also potential investors, affiliate marketers, clients, etc.
But Don’t Forget To Beat The Streets
If you can attend seminars, conferences, conventions, and other types of events that put people face to face in your industry, do so. It will be worth it to go and make real connections with real people.
Consider Having An Affiliate Program
If your startup is based around a physical product or a service that can be sold through your website with a simple checkout process, think about establishing an affiliate program. Proficient affiliate marketers often stick to one or two niches and know them and their customers’ needs very well. They can help get you in front of people who will buy from you often much better than even traditional marketers can.
But be prepared to pay a decent percentage commission. 5% isn’t enough. To get an affiliate’s attention, you’re going to want to offer a 10% commission at a minimum. Superaffiliates will want 25% or more, but those affiliates are worth it for the amount of attention they can bring you.
Be Focused On Your Businesses
Working in your own startup is more than a full time job, so be ready for that reality. You’re not going to be like other people working just a 40 hour week. You may end up working 50-70 hours a week in the beginning to get things launched into orbit.
But, these 50-70 hour weeks should be temporary in the long term scheme of things. The goal is to get yourself scaled back to a normal 40 hours a week and if your business model supports it, maybe even less than that once you’re established.
But Don’t Burn Out
Burnout is a real thing and if you don’t take care of yourself in the beginning stages of your startup, you can burn out and end up being worthless. Take a weekend off when you need to. Take time for your significant other, your spouse, your kids, and even grab some alone time. Watch a movie, go out to eat.
Starting a business can not only burn you out, though. It can also burn your significant other out, as well, especially if there are kids involved. Take time off with them to reduce the amount of stress caused by your unavailability.
And Sleep. Yep, the Dreaded “S Word”
People who are all about hustle don’t like hearing that word, because to them it means they’re not getting anything done.
But, getting a healthy amount of sleep will make you more efficient and you’ll make much better decisions. If you have to nap during the day while you’re at your office, make accommodations for that.
If you’re in doubt, don’t be. The science is settled on the necessity of approximately 8 hours of sleep a day for the average adult. This is especially important for someone who’s going to be running as hard as you will be while starting a business. Don’t underestimate how much sleep you need.
Nitpick Prices And Be A Negotiator
When you’re making purchases, get the best deal you can. You may not think that an extra $0.05 per makes a difference, but if you’re having to buy hundreds or thousands of something, being able to get that same thing for $0.03 is huge to your bottom line. Negotiate. It doesn’t hurt to ask or shop around.
Know How To Get Someone’s Attention… Fast
Are you good at making someone’s ears perk up? If not, you need to get good at it. There will be a lot of opportunities for you to get funding or other benefits from people if you can just hold their attention long enough.
You may have a minute, you may have 30 seconds before you lose them to the next phone call or appointment.
Get good at making use of that time, especially if you’re going to need people to invest in your startup to make it work.
Giving Up Is Easy… Don’t
Finally, things will be hard. It’s just the nature of starting any business. You’ll have points where you may want to quit. Others may want you to quit or even encourage you to.
Be committed to your vision and take heart. There are others out there starting up just like you. You can do it.