5 Proven Steps to Building Your Company From Startup to a Sustainable Business
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5 Proven Steps to Building Your Company From Startup to a Sustainable Business
So, you want to start a business?
What next?
It is easy to rationalize and form assumptions based on hope.
However, successful entrepreneurs believe one thing - HOPE IS NOT A STRATEGY.
That said, you need a sound strategy based on time-tested principles and real-world applications.
Here we go:
Your Crazy Idea
"The world is made up of crazy ideas" - Phil Knight (Creator of Nike).
The first question you need to ask before deciding to start a business is your idea.
Your idea is the seed from which the business will grow.
To make money is not enough; what value do you want to offer the marketplace? What is missing that you feel you can provide?
Steve Jobs famously joked in an interview that if you don't have any idea for a business, go and get a driving job until you find one.
This is quite true because the going will surely get tough. And unless it is an idea you really believe in, you will quit.
Your idea could be a solution :
> to problems faced by members of the society.
> to problems that no one seems to be solving presently.
> to improve an existing solution to a higher degree.
> that people are already wishing and hoping to have.
Your Business Model
Now that you have identified your business idea, how do you create and capture value in an identifiable, usable, and rewardable format for members of the society?
Simple answer - your business model.
As you may already know, a business model has several distinct components that come together to capture and deliver value to your customers.
Pick your pen and ask yourself some more questions:
> What is your business idea (or the value you intend to create)? You can refine and polish it so that it sounds nicer.
> How can you create and deliver this value? This question addresses your channels for communication and distribution.
> Who will buy your products? These are your target customers. Remember, if everybody is your customer, then you have not defined your market.
You can create a customer avatar to assist you. What are their preferences? Where do they live? What is their realizable income and spending habits?
> How will your company make money? Yes, this is a critical part because if you don't make money, you will soon be out of business.
Think through to identify your revenue streams. The more the streams, the better for your business.
> Who can you partner with? As a startup, you do not have all it takes to enter and conquer a market.
You need allies - investors, stakeholders, gatekeepers, suppliers, etc.
> What costs will you incur? Here, costs can be divided into two areas - fixed and variable costs.
Fixed costs rarely change as your output increase, whereas variable costs change as your outputs change.
Your Business Plan
With your business model in place, creating a business plan should not be difficult.
Although it is widely reported that no business plan survives the first contact with a customer, you still need a business plan to guide your activities.
Moreover, you cannot access loans without one.
Important parts of your business plan include financial projection, costs analysis, marketing plan, and operations strategy.
Your A-Team
Steve Jobs often referred to the Beatles as his team model because they kept each other's negative tendencies in check while producing really great music.
You cannot run your startup by yourself. You need a balanced skill set, that is, technical, finance, accounting, business, marketing, etc.
However, you should select carefully because your success will depend largely on the success of your other team members.
Your Systems and Processes
This is an essential part of your business equation.
Strive Masiyiwa (Chairman of Econet Wireless Group) said that a successful business has three critical components - people, products, and processes.
These processes include - Marketing, Sales, Recruitment, Production, Administration, etc.
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With these components in place, you can rest assured that you will create a startup that is not only successful, but is also sustainable.
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