Establishing a startup can seem like a fairly complex task. If you’ve got an idea for a new business but aren’t sure how to get started, don’t worry: there are a series of steps that you need to follow, but if you go about them systematically, you should be able to get your startup going within a reasonable period of time.
Doing thorough research before starting your business is essential. You should familiarize yourself with the statistics of building a startup and the various components of creating a successful business.
You won’t have an accurate idea of where your idea stands vis-a-vis other potential players until you take a look at the overall market and how your potential competitors are faring. This involves analyzing both your competitors themselves, as well as determining your target market.
Target Market Analysis
Even if you have a rough idea of who your target market is, you should determine their precise demographic makeup if you want to be truly successful in your startup. This means conducting both primary and secondary research.
Primary research involves going straight to the sources of your potential market, i.e., the customers themselves. After you’ve refined your product idea to the point where you have something specific to offer, test it out on the public to assess their reactions. There are different ways that you can do this, including surveys, questionnaires, and interviews. Be sure to keep track of the characteristics of your respondents, including their ages, genders, income brackets, etc as this will help you better refine your marketing efforts in the future.
Secondary research involves examining research that has already been published by other groups. This can include industry reports, statistics, trade association data, and any additional information that might be relevant to your goals.
If you want to create a solid business plan, you should combine the results of your primary and secondary research.
Identifying a Unique Value Proposition
Once you’ve figured out where your ideas stand in the overall market, the next step will be to identify a unique value proposition. A unique value proposition is a statement of your product's (or service’s) specific selling points. It explains what the particular benefits of your product are, why your product is preferable to others on the market, and how it resolves customers’ pain points.
The steps for developing a unique value proposition are the following:
- Create an ideal buyer profile.
- Craft a description of your product’s distinguishing features according to the profile(s) you created.
- Test your UVP. Find a group of potential respondents you are not connected to and can provide objective opinions on your proposition. Once you’ve collected respondents’ opinions, you can then further refine your offering.
Business Plan Development
Once you have all of your preliminary information together, it will be time to develop a comprehensive business plan. Your business plan will guide you to your goals and also allow potential funders to understand the specifics of your operation.
Your business plan needs to include a mission statement, a company description, and the results of your preliminary market analysis. In addition, there are several other components that you need to include, which we will list here.
Funding and Financial Management
You will need to include a plan for how you will fund your operation and manage your finances once you’ve started. Your plan should include projected financial statements, as well as balance sheets and estimates for cash flows. Experts recommend that you prepare statements for the first five years of your startup’s operations.
Consider the following options for securing funds:
- Small business loans/small business grants
- Angel investors
- Venture capital
In addition to securing sufficient funds, you will also need to include a risk management process. In order to guard against potential losses, it is critical that you have a solid risk management process in place.
Legal Structure and Registration
You will need to decide on a legal structure for your startup and register it in the state where you will operate.
In registering your business, you need to complete the following steps:
- Choose a name for the business. Be sure to check the records of the state that you will be operating in to make sure that your desired name is available. The name you choose should be unique, relevant to your operation, and easy enough that people will be able to remember it easily.
- Register your business. There are different options for registering, depending on the number of people involved and how you want to be structured:
- Choose a sole proprietorship (if you will be working alone),
- A partnership (if you will have exactly one partner) or as
- A corporation or Limited Liability Company. Read up on the specifications of all of these structures before you decide how to register.
Secure whatever other licenses or permits are necessary for your type of business in your state.
In the product development section of your business plan, you will describe the products or services that you will be offering. You should lay out clearly what your products will be, how they differ from those of your competitors, and what the component costs are. If you are providing a service, describe the steps and work that are involved in carrying the service out.
Building the Team
Another important aspect of your business plan will be team building. Startup team building is an essential part of your plan because you want to create the right team structure and group dynamic from the beginning.
Before you start, look at your competitors to see how they craft job positions and applications for their staff members. Think about the positions that your startup will require and what type of people you want to attract to those roles. Also, consider whether you will want people full-time, on a contract basis, or freelance.
Make a list of the places where you want to post job announcements. This can include:
- Major sites, such as LinkedIn and Indeed
- Independent job sites such as Craigslist, Upwork, and Fiverr
- Your own social media, email lists, website, etc. You might also consider partnering with other relevant companies to share resources and expand your reach.
Branding and Marketing
Once you’ve established your ideas for the products or services you want to sell, you will have to work out a branding and marketing strategy. The first thing that you should do is establish a solid brand for your business.
Idea Generation and Validation
There are a distinct set of features that you should keep in mind when creating a company brand. These include logos, color palettes, typography, and any other imagery that you might include.
While you go about your brand building, there are steps you can take to validate your ideas:
- Brainstorm with your team.
- Look at what your competitors are doing.
- Once you’ve created an idea, you can validate it with online tools.
- Take the results of your analysis and use them to refine your idea further.
Your marketing plan will similarly rely upon the results of your preliminary research. The timing, channels, and frequency of your marketing efforts should all be based on your industry research and the trends you observe in your target audience.
Once you've established your branding and marketing strategy, creating a startup marketing budget that aligns with your goals and resources is essential. This budget will determine the allocation of funds for various marketing channels and activities, ensuring a strategic and cost-effective approach to promoting your brand and reaching your target audience.
Technology and Infrastructure
Another critical element of your startup is the technology and infrastructure that you choose. Having the right infrastructure in place for your network will help you increase productivity and ensure your systems are secure.
Your infrastructure will consist of the following components:
- Computers, hard drives, and software for your team. Ensure that you have sufficient PCs for your team, hard drives, and software in place.
- IT infrastructure (networks, clouds, etc)
Be sure that you find reputable vendors so that you can establish reliable IT policies and not have to worry about potential security breaches.
Launch and Growth Strategies
Once you have all the necessary elements in place to launch your startup, it will be time to think about your launch strategy. It is critical that you have a strong launch as this will be the first impression you give your target audience.
A successful launch strategy should contain the following elements:
- A solid basis for lead generation
- Audience segmentation
- Relevant and optimized content
- Timeliness and appropriate choice of channels
- Feedback. Once your launch is complete, collect feedback in the form of surveys or questionnaires to assess the public’s reaction.
Just as important will be your larger growth strategy. Your growth strategy should include information gathered from your marketing strategy, including the specifics of your target group, the results of your competitor analysis, and your unique value proposition.
In addition, you should think about the following components in your overall growth strategy:
- Your long-term goals. Goals should be specific, measurable, and relevant to your product. You should include income growth goals, website traffic increase, etc.
- Potential product or service diversification
- Addition of new offices/team expansion in the future
There is a lot of competition among startups these days, but if you have an idea that you believe could turn into a successful business, start doing research on how feasible it might be. If your results are positive and you go about the process systematically, your startup idea could become a great success.