11 Best Practices for Launching a Startup
Plenty of entrepreneurs have great ideas. But the ability to take a great idea and turn it into a long-term success in terms of marketability and profitability, is what distinguishes successful entrepreneurs from aspirational entrepreneurs. For anyone planning to start a new business venture in 2016, it may prove helpful to stay focused on the following pieces of advice:
1. Just get started.
Many experienced startup CEOs advise that it is better to simply start a company and get it moving, than to wait with the hope of starting it in the “perfect” way. No real company will ever achieve every aspect of its founder’s ideal, but taking a great idea to market sets an entrepreneur well on his or her way to achieving success. Simply getting the design completed, the prototype created, or even the domain name registered represents one step in the right direction.
2. Demonstrate enthusiasm.
To catch funders’ interest in a potential startup, nothing succeeds quite as well as an entrepreneur’s own passion for his or her enterprise. Additionally, that passion needs to be coupled with a demonstration of the drive and determination to make a success of the business.
3. Know the rules of the financial game.
An emerging entrepreneur will also need to understand the key points at which it is critical to raise funds. This may be at the beginning of an enterprise, nearer to the product launch, or somewhere during the middle course of getting the business on its feet, depending on the needs of the company. This ability to gauge when to solicit funds is a vital skill.
4. Know your niche.
Would-be investors will also want to know that an entrepreneur has a thorough grasp of the core strengths of his or her product or service, and understands the market niche it is designed to fill. It also pays to be realistic by demonstrating that you realize any problems and limitations inherent in your new enterprise.
5. Learn from the pros.
Some of the most successful and widely-admired entrepreneurs have shared their insights with the public, in interviews and through their own writings. Here are a few examples of their advice:
Elon Musk, CEO of Tesla Motors, Inc., and SpaceX, says that entrepreneurs should solicit feedback or criticism from a wide network of staff and outside observers. A businessperson need not necessarily take all this advice or act on it, but he or she definitely will profit by understanding it. Musk advocates asking for insights that specifically point out what is wrong with an idea or a design.
The late Steve Jobs of Apple was quoted as saying that an entrepreneur should look for new high-level executive hires that exhibit not only competence, but also love for the product or service you want them to help you promote.
Jeff Bezos of Amazon.com has gone on record advising new entrepreneurs to stay constantly open to changing their minds; even about cherished views. One can maintain a well-established viewpoint and still remain receptive to new ideas that could set that business on a radical — and profitable — new course.
6. Put customers first.
In this age of social media, a customer complaint can quite literally travel the world within a few minutes. Entrepreneurs need to focus on devoting the time and resources to putting customer service at the forefront of their businesses — and letting their customers know that.
7. Invest in high-quality content.
Media professionals assert that slick advertising in and of itself is no guarantee that a company’s message will be heard and acted upon. As a result, a major priority for 21st-century entrepreneurs should be offering interesting, relevant, and superior content in order to maintain and increase connections with customers.
8. Make frugality a company value from the beginning.
Experts say that once a fledgling company has created a culture of lavish spending, the practice becomes harder to curb. Stay focused on goals, only spend what you have to in order to grow the business, and stay accountable for expenditures.
9. Be prepared to notice opportunity.
Many of the world’s greatest entrepreneurs were not themselves innovators, code writers, or technological geniuses. Yet their knowledge of best business practices and their ability to spot a great deal, have led to the creation of some of the world’s greatest businesses.
Richard Branson’s formation of Virgin Atlantic Airways three decades ago is one example. The young and cash-strapped Branson was hoping to travel to the Virgin Islands for a vacation when his commercial flight was cancelled. In desperation, he chartered a flight that he couldn’t pay for and persuaded other travelers in the airport to pay $29 each to fly along with him by holding up a sign saying “Virgin Airlines.”
10. Know when to ask for help.
Outsourcing operational tasks whenever possible can save overhead costs. And in today’s remote-access, globally-linked business community, it can even prove to be an asset. In addition, emerging entrepreneurs should not hesitate to ask experts for accounting, strategic, or other professional advice. It can even be a good idea to follow up by asking these professionals to help implement their advice in exchange for shares in a promising startup.
11. Offer equity strategically.
When raising capital for a new company, an entrepreneur needs to think carefully about the amount of equity to extend to investors, partners, and executive staff. Offering too much equity can result in giving up control of one’s own company. While equity shares can be one of the major factors for getting experienced professionals onboard in a new company, an entrepreneur should not just give away equity as a matter of course. Establishing an equity pool to be shared among new hires can be a better strategy to attract top talent while minimizing the amount of equity that ends up outside the founder’s control.