Spending an entire career in Corporate America can be fulfilling for some people. For others, there is a strong desire to be one’s own boss. For the latter, I write this to share my knowledge on start ups and to light a fire under you to get going!
- Brainstorm an idea.
- Refine idea to map it to a specific market (patent idea if it is an invention).
- Analyze the market, identify potential customers, and determine if a customer need is not being met. In other words, what can you provide that is unique?
- Determine the time commitment it will take to make this successful. If you are currently working, this will need to be taken into account. If you cannot make the time commitment, the business has a high likelihood of failure. Expect work on the weekends and after work to make this successful.
- Develop your vision and mission and begin working on your “sales pitch”.
- Detail all of your potential revenue streams.
- Detail out fixed expenses, such as rent, machinery, etc that you will need in your business.
- Detail out variable expenses, depending on the volume of your sales and/or operations.
- After analyzing your potential expenses in the worst case, extrapolate these for at least 6 months to 1 year of operations. This is the majority of the start-up capital you are going to need.
- Determine your marketing strategy. How will people become aware of your product/service? Word of mouth? Online advertisements?
- Incorporate (this can be done earlier, but should be done before you try to get capital from anyone).
- Go to your network and gather some potential investors. You would be surprised how many investors you can find at work, through your family, etc.
- Set up a series of meetings with these potential investors to get start-up capital. If a S Corp, determine how you will give them a share of the business. If a LLC, LLP, etc then determine what their payback arrangement will be and put it in writing. Do not guarantee a return and ensure that the documentation goes not guarantee a return on investment.
- Now that you have the capital, begin executing your mission.
An important note is you can get some potential customers on standby before you even go for capital or soon thereafter. This is a huge advantage, as you can rely on some revenue immediately.
So, that’s a starting point for you. Get going! The only thing holding you back is you!
