Entrepreneurship is neither science nor art. It is a discipline that you can only master by dedication, consistency, and self-discipline.
Still, we see many entrepreneurs giving up too soon while starting a startup.
The complication is that there is no hard and fast rule that explains the process of how to start a startup. It is a trial and error phenomenon that varies for each niche and consistently changes over time.
The biggest mistake that most entrepreneurs make when they think to start a business is that they get overly optimistic, thinking that their business idea can change the world, and forgetting that coming up with a creative startup idea is only the first step and many more remain to become successful.
Another thing to note is that the market is now completely saturated and expectations of customers have grown to a level where catering to them is not an easy task, especially not without a clever execution plan.
While starting a successful startup is tough, it isn’t completely impossible. So, let’s learn the right approach to start a startup in 2018.
Think of a Brilliant Startup Idea
What is a brilliant startup idea anyway? Brilliance is not just to come up with something unique because not every startup idea is unique. It just has to be the better version of what is already available in the market.
Said Rick of SuperHi has put it in the best way:
“Your startup needs to be the best-in-class, not the first to the market.”
Google was not the first search engine neither was Facebook the first social network, they are just better from their priors.
To think of a brilliant startup idea make sure it can guarantee you success. That it is something that solves a problem and something that your prospects need.
Remember, your idea is the first step of your journey. So, sleep on it and you can come with something ingenious.
Identify Your Niche Market
After coming up with a startup idea, ask yourself, “who will be interested in this idea?”
Take into account your potential customer’s attributes such as age, gender, relationship status, income, and hobbies.
Sometimes you need to dig deeper to identify the buyer persona, customer needs and wants, aspirations and the loopholes that you can fix with your or another existing product. Talk to people about your idea and see if they are interested. It is even better to select a target market and then approach those customers only.
The CEO of HashCut, Vijay, tells us how he found a new audience for his product. He says that he talked to YouTube enthusiasts, gamers, creators, and many more people, asking them about their habits such as watching videos, sharing interests, and more. ‘
In the end, we showed them HashCut, and asked how they might use the product.’
This helped him realize a core audience for his product. He then re-positioned the website, social handles, and marketing around it.
You can also find products that are already in the market and make them even better. For example, a coffee maker that can be used in the car.
After identifying the niche, start small. Focus on being better with a selected group of people.
‘Once you can do that, you’re equipped to tell the press and your customers a story on how your startup is going to change the world,’ says Paul Burke, CEO of RentHoop. Paul used the same strategy to market the product to his customers.
Determine Product-Market Fit
Achieving the product market fit can be challenging for startups in the initial years, as it requires a deep understanding of your target market.
You can only win your buyer’s trust if you are solving their real problems with your product.
‘Make sure you are solving a big enough problem. If your company’s problem is not 10X better than the traditional product or service, it will be difficult to have a product-market fit. Talk to strangers, family, friends, and coworkers and see if they would PAY for your product or service not just see if they like it,’ says Gene Caballero, Cofounder at Greenpal.
It is better to charge your very first customers to make sure they’re willing to pay.
As Steve Benson of Badger Maps says, ‘Even if your product is still a piece of junk, don’t give it away for free, or else you won’t learn if it’s a problem worth paying to solve.’
Target Prospects by Understanding their Behavior
You need to understand the behavior and lifestyle of your prospects before you can target them for your marketing activities.
For example, for an audience that’s between 20 and 25 years of age, using social media channels will be the right one to reach them.
You can also find publications that target the same audience as yours. Once these publications are identified, pitch them as frequently as you can, about subjects surrounded by your startups. The more media opportunities you are able to secure, the better are your chances of becoming visible.
Linda Parry Murphy of Product Launchers, wraps it up succinctly saying, ‘If you have a business service, announce it on the radio so that prospects can hear your message while in the car thinking about work. If you have a consumer product, reach out to the trade media so that it’s on the radar of the retail buyers. Also, the old adage is true. You have to spend money to make money. And, if you have a killer value proposition, this will pay off tenfold‘.
One more way to connect with prospects is to create tailored messages for them. Different groups of audience need different messages. And, the best way to reach a wider but targeted audience is through digital marketing, which makes personalization even easier.
‘GREAT WINE, Inc. creates different key messages for each group of target audience. For millennial, the company emphasizes on “affordable everyday wine,” with additional classes on “vinotype.” For generation X and Baby Boomers, it highlights the concept of “ vinotype,” wine tasting, and wine lessons‘, says Michella Chiu Director of Brand Marketing at GREAT WINE, Inc.
Build a Winning Startup Team
To launch a startup get an astounding team on board, who will either assist or lead your execution plan all the way through.
Even the best business ideas are a waste if you don’t have the right people working with you to execute them. In fact, not having the right team is one of the biggest reasons most startups fail.
Three key elements of a winning startup team are:
- All team members work toward a common goal.
- Each of them takes interest in the idea.
- They all should strive for growth because that’s the only success factor
Therefore, hire a solid team of people that are willing to go through walls [so to speak]. Kreg Peeler, Founder of Spingo, an event marketing company, found his team members in the same way. He said that while searching for the best team members, he only focused on people that were creative, driven, and could adapt to a high-stress environment.
Similarly, many entrepreneurs put too much value in their idea or brand, and neglect to value their employees enough.
‘Acknowledge the fact that you can’t do everything alone. So, recruit the right people, make them grow, and keep them happy. Also, ‘don’t be afraid to fire the wrong ones,’ says Mike Khorev, a digital marketing strategist while emphasizing the value of being straightforward in business.
Network So that People Know You
No matter what your business model is and to whom you are going to sell to, networking can be beneficial for you in one way or another.
As a startup founder, network with potential buyers or to identify their needs and wants. Similarly, network with influencers to get valuable feedback about your product. And, if you need some investments to launch your startup, network with investors and get insights about what type of startups they invest in and what they see in those startups.
While emphasizing the importance of networking, Monica Barrette, founder of Monica Barrette Agency, says, ‘Meetups can help you find like minded people and avoid bottlenecks. Find an industry professional to test your product and learn from their experiences.’
Immersing yourself in a network of like-minded business owners provides an insider’s take on the industry and allows you to develop relationships with business owners who previously forged their own startup paths.
‘Many times they will share their own stories and experiences that will help you avoid the very mistakes they made-saving you time and money along the way‘, adds Josephine Caminos Oria of La Dorita.
Know Your Competitors
While starting a startup, to compete in a market that’s already filled with similar businesses, it is essential to know who are the direct and indirect competitors of your product.
Startup founders need to understand that at the initial stage they can’t compete with bigger businesses as these businesses don’t face those problems which small startups do and most of the time, their budget is hundred times bigger than the startups.
As Porter says in Five Forces of Competitive Position Analysis, you can analyze your competitors by identifying:
- Who their customers are?
- What technologies do they use?
- How much can they spend on their marketing?
Before launching your new business venture, make sure you have a good understanding of the industry such as the trends, current state of the market, and the recent news, as well as an understanding of the potential competitors.
Knowing your competitors inside out is invaluable. It gives you insights into how you can position your brand so that you can stand out and succeed.
‘It is also necessary to know the industry inside out, but don’t let the industry knowledge replace competitor analysis, because it is the in-depth knowledge of the competition that will set you up for success,’ says Matt Edstrom, Head of Marketing, Bio Clarity.
When launching a new product, it’s tempting to look at other products or competitors to see what’s working or what isn’t working for them. Startup founders typically have their own biases on what channels might be effective and which might not be, causing them to completely overlook a channel that might have a lot of potentials.
‘More often than not, your competitors are also overlooking that channels, which may spell opportunity. So, before finalizing your marketing strategy, make sure to at least consider what each channel might have to offer,’ Mathew Lazarus, Chief Innovation Officer, Archbolt.
Finally, to successfully start a startup, there are many more things to do such as performing beta tests before launch, having multiple growth strategies in mind and following a systematic path.
Decide between Fundraising and Bootstrapping:
People who start a startup follow two financial models to sustain themselves: Fundraising and Bootstrapping. Each has its own advantages and disadvantages.
Bootstrapping is viable when you have funds to grow your startup single-handedly. However, in such a scenario, you will be the only stakeholder and the success or failure of the startup will solely depend on you.
Fundraising is a feasible option if you are starting a startup but are on limited funds and require assistance from venture capitalists. Investors will help you grow your business by sharing the equity. But there is a chance that they will take your startup in a direction you don’t agree with.
While making the decision, you have to be smart and understand the differences in both the approaches as your decision will have a big impact on your startup’s growth.
As a startup, don’t be scared of failure. It’s better to try and fail rather than not trying at all. Many successful entrepreneurs have failed and that’s how they came across the recipe for success.
As Josh Fetcher, Co-founder of BAMF Media puts it: Don’t say,”My startup failed.” Say,”I failed my startup.” Reframe your thoughts. Have more control over your life to get better outcomes.
Just remember that your determination and the right approach are the key factors to a successful startup launch.
What have we missed in this article? Let us know in the comments below.