5 Things to Consider When Starting Up
What You Should Consider When Starting Up
Starting up is a very curious exercise. It can fill up the ambitious void in your heart and give you an amazing boost on one day and make you fall flat on your face the very next moment without a warning, and it is this unpredictability that draws people towards it.
Lately, the media has taken a liking to portraying “starting up” as some glorious endevour. However glamorous or appealing starting up might be and regardless of the rumors that you’ve heard from industry pundits on how demanding and time consuming the process is, it’s wise to have a substantial idea of what you are getting into before taking the crucial step.
Here are a few things that you have to keep in mind while making the decision to become an entrepreneur, and what you should consider while starting up.
Get Ready for Risks and Responsibilities
Entrepreneurship comes with a huge set of risks and responsibilities, but if you sail through the initial storms, it could provide huge returns as well. You cannot expect to break even and make profits from the business instantaneously; as patience is a vital virtue here – just remember that there is a right time for everything.
Some of the most successful entrepreneurs in the world have undergone losses and failures before finally finding success. Starting up is not meant for people who are impatient or give up easily. If you are going to survive as an entrepreneur, you will have to fend off a thousand storms before reaching the sunny shores.
Do You Have A Plan?
Once you clear the initial horrors of impending risks and responsibilities and decide that you still want to start your own company, ask yourself the following questions.
- What kind of product or service do you want to provide as an entrepreneur?
- Why have you chosen to provide this particular product/service?
- Is there a real need in the market for this kind of product/service?
- Are there enough people who’ll want to buy your product/service?
- What is your target audience? Do you have an adequate understanding of their lifestyles, needs and attitudes?
- Is there any other player in the market who is providing a similar product/service?
- What is going to differentiate you from your competitors?
Asking yourself these questions will clear your head and give you a good idea on where you stand. It will be even more helpful if you put the answers down on paper in the form of a business plan.
No plan yet? Check out the Top 5 Business Planning Tools
What Can A Strong Business Plan Help You Accomplish?
You’ll understand whether the service that you are about to provide has enough potential to survive in a competitive marketplace. Going to market without a strong enough product/service and without adequate knowledge about your target audience is akin to trying to cook a dish without any knowledge of the ingredients involved.
If your product/service is not up to the mark, you’ll need to work hard to strengthen it and make it customer-friendly and ready-to-launch, as only then will it be worth the risk that entrepreneurship entails.
Chart Out Your Finances and Business Model
What would be the initial investment for the business you are about to start? You will need to work this out, taking into consideration things like taxes based on your type of corporation, vendors, office space, hosting, technology, labor, etc.
Once you’ve done this, you will need to look at how much of your own money you can pump into the business and how much you will need to borrow. Well-written revenue projections is a must if you plan to get funding from venture capitalists or investors. A great tools to use for investor revenue projections is EZ Numbers because it automatically calculates taxes, ROI, equity, breakeven, and more.
Choose Your Entity Wisely
What is the form of the business entity you want to start – is it going to be a sole proprietorship, a partnership or a corporation? Each of these has its own advantages, disadvantages and set of regulations, taxes, assignments of stock, all of which you will need to consider before you’re starting up.
You will need to obtain all information regarding government regulations, licenses and clearances related to your line of business. This would prevent legal wrangles from stalling your work and getting you into trouble at a later point in time.
It is essential to be aware of the above procedures and issues so that you’re not caught off guard when you actually startup.