Becoming an entrepreneur seems trendy. But there’s some bad news. Researchers say that a whopping 90 percent of startups fail.
As discouraging as it can be, it’s always good to look at the positive side. What does success bring? You become independent, bring value to the world, and make a living.
There may be an element of chance, but the difference between success and failure is strategy. In this guide, we shall take you through some proven tactics for making it in your new business venture.
Aim To Solve A Problem
Your startup idea should aim to solve an existing problem. The needs of people should guide your concept, and you should visualize them before creating a business plan. So, before getting started, ask yourself if your business will be helpful to someone. Go ahead with your startup only if people will care about it.
Additionally, think about your purpose in life. Focus on your strengths and what motivates you. A successful idea manifests lifetime importance. You should be able to fulfill it over a given period and defend it whatsoever.
But how do you come with excellent ideas for a startup? Most successful entrepreneurs follow their passions. Think about modernizing your hobby or talent, or focus on what you have in abundance. Look for undiscovered opportunities or areas where the current businesses have failed to suffice.
Create A Valuable Team
When building your team, focus more on what individuals bring to the table rather than the squad’s size. It shouldn’t be too big, and every member must have a self-drive towards achieving the company’s vision. Success motivates the right partners, not remuneration, and benefits.
When building your team, look for knowledgeable people who can sacrifice and improvise to resolve a problem. They should be able to unearth problems in the community and find ways to answer them. The individuals should also know how to reach the populations that need the achieved solutions.
Find Dependable Funding
Did you know that some 82 percent of businesses fail because of cash flow problems? Your startup will need sufficient funding to get off the ground. The amount required, however, will depend on your industry and situation.
For instance, $10,000 may be enough to grow a small scale startup without equipment and paid employees to profitability. Ventures with considerable overheads may require hundreds of thousands or millions.
According to Fundera, 77 percent of new businesses in the United States rely on personal savings for initial funding. Banks are less likely to provide a substantial amount to startups. When they do, they often offer outrageous interests. So, be careful when taking out a bank loan.
A less expensive funding option for new businesses is investors. Consider your friends, family, venture capital firms, and so on. Be sure about the terms, lest you give too much equity in your business before getting on your feet.
Understand The Market And Consumers
If your business is ever to make it, understand your market in depth. If you are not conversant with the features of the practice you have ventured, your chances of success will be slim. Stick to the sphere you understand.
Remember that customers come first. Think like the consumer, figure their needs, and provide the best possible service if you have to do something you are not familiar with, research until you become an expert.
Know Your Risks
Every venture, whether new or established, comes with its risks. They should not put you off or extinguish your business idea. When starting, you can get worried about market availability. Will people find your product necessary and pay for it? You must identify your offering, the problem it solves, and its worthiness to users.
You also have to address financial risk. You can start with savings and contributions from friends, but what happens when your sources aren’t adequate? Know your limits when looking for new investments. Other risks include copycats in the industry and team experience, among others.
Risks are inevitable, but they don’t have to get out of control. With reliable risk management strategies, you can always contain them. Risk management involves risk identification, assessment, treatment, monitoring, and continuous improvement.
A strategy that works for most startups is the minimum viable product (MVP) approach. If you are launching a new product, first release a bare-bone version that serves the intended purpose. It will help you to collect feedback and data about consumers.
MVPs have several benefits. You don’t invest too much time and money until you identify your target group. Customer feedback gives you insights on where to improve while obscuring your final idea from potential imitators.
Start Professional Networking Early
Once you’ve decided to begin a business, start creating connections with people who can build you. Word-of-mouth marketing, for instance, is a free but handy tool for pushing companies to the next level. Recent studies show that verbal recommendations influence the buying decisions of 83 percent of consumers. So, you want everyone to know and talk about your new business.
Networking not only creates brand awareness but also links you with a lot of great talent in the future. Top companies attract the best personnel and investors because they can reach whoever they wish. They can claim the expertise they want before their competitors.
To start professional networking, set up LinkedIn, Facebook, Twitter, and Instagram, among other social accounts, and update them regularly. Stand out of the competition by posting informative content about your niche and products.
In business, there’s no such thing as mastering everything. There’s always something to learn, especially because industries keep developing. The same applies to mistakes. When you commit one, consider it a lesson.
Learning presents new opportunities for development. You stop growing the moment you become too complacent. Be the first to pick up new ideas in the industry and implement them to stay on top of business.
The Bottom Line
Sadly, 9 in 10 startups fail within five years. But you don’t have to be part of this statistic. If you want to succeed, you must provide a real solution, adapt to the times, and interact with the right people. Refer to the tips in this post to maximize your chances of business survival.