The hardest part about starting a business is…starting. At least that’s according to what many of you have told me.
You have these amazing ideas and business concepts but actually starting them is where a fair few of you are apparently getting stuck.
With it being a new year it’s the perfect time to start about starting that business you have always talked about and because I hear that the starting point is so hard for so many of you, I have created my favourite 10 steps to starting your own business.
Don’t worry about the order of these steps, just know that every time you take one of them, you increase your own confidence to take the next.
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Transcript:
Controversial opinion, but the hardest part of starting a business is, well, starting. Or, so many of you have told me, you have great ideas, dreams of creating a billion dollar unicorn, amazing plans, but you're too afraid to take that first step. And that's where you get stuck.Well, I've actually never found the first step to be the scary part. I love the rush, the excitement, the creativity that comes with selling something totally new. And I guess that's why I've started and sold three businesses now. But I hear this so often, that I created my favourite 10 steps to starting a business.
If you fold them in some semblance of an order, at the end of it, you're going to have a solid foundation to grow from. And don't forget, every time you take a step, you build confidence for taking the next step. So let's get going. Step one is to find your vision, mission and purpose. A strong business, and particularly a mission-led one, starts with a clear vision, a mission and a purpose. But aren't they all the same thing? Well, no. Your vision is the world you want to create if your business was wildly successful beyond your wildest dreams. Your mission is the road map to get there. What is it you're actually going to do? And your purpose, the one thing we all talk about so much, is the reason behind it all. Why are you doing this?
Now, you need to keep them simple, concise, authentic, and of course, they have to be aligned with your personal values. A purpose that is just wedged into a business for marketing purposes falls to no one. Step 2. Who are you talking to? Who are you solving problems for? No, I am not asking for a demographic. I don't want to hear that you are looking for women 18 to 35. That is a demographic, not a target market. You need to figure out who you're serving with your product or service. Consider things like interests, life stages, pain points.
Be as specific as possible when defining your target audience. Build a persona as if your target audience was a person.Where do they hang out online? What do they do? What do they stand for? What dot hey like doing? What do they stand against? You will have to make a lot of assumptions that you can test later, but you need to have a really niche-down idea of who your audience is.
It will help enormously in the long run.And yes, you can have more than one. Step three, let's look at the market.There is bugger or point doing something if the market is that jam-full, no one will hear you say anything. You can almost always stand out, you need to know that going in. Also going to be a little bit harder if you've created something brand new and consumers don't even understand it. Take it from me, creating something brand new is great for press, but when it comes to explaining to a customer what a solid face moisturiser was, I was met with a lot of blank faces for many, many years. So you need to research your industry, your competitors, and market trends to identify opportunities and gaps that your business can fill. Look at things like competitor offerings, market size, growth, trends to find your unique selling point. And step four builds on those last two.
So you have your audience and you know the market and the competitor landscape. So what is your unique selling proposition? What makes your company different than everybody else. Why would a consumer buy your product when it sits on a shelf next to something very similar? I don't mean things like it's got blue packaging or it's 10 cents cheaper. I mean things that are unique enough for the consumer to actually care about. It doesn't have to be an enormous thing, but it does have to matter to your target audience. So craft a powerful USP, unique selling point, that sets you apart from that competition. 42% of startups fail due to poor product market fit, or simply put, the market didn't want their product.You do not want to be in that statistic, and it's easily avoided. No, this can't bruise your ego.
So next, go out and test your product with your target audience. You can use surveys, prototypes, social media, even crowdfunding, and then once you have feedback, tweak your product and test again. The caveat here is, of course, that the best product feedback comes from paying customers because people will say things that they don't necessarily mean. So don't wait to launch your product until it's 100% perfect. Launch, get feedback, tweak. Launch, get feedback, tweak.That's really a business's entire lifespan. What's the saying? If your product was perfect when you launched, you launched too late. Never a truer word spoken. Step six is to create a business plan.
But no, not a 50 page monstrosity. You will never hear me say you need a 50 page business plan. But you do need a plan on apage. You can grab a template off businessbutbetter.co. But all you really need to do is jot down your vision, mission, purpose, your goals for the next 12months and break down those goals into how you are going to achieve them. I used to despise planning and I thought it was really cool to fly by the sea inmy pants. But I was taken off track so many times by seemingly great opportunities that just came along and continued to pop up. I wasted a lot of time and a lot of money on them. A plan on a page will stop you doing that. As entrepreneurs, you're always distracted by the new shiny thing. A plan on a page will make a huge difference, I promise. Step seven is fun, though some people do find it frustrating. What are you going to call your business? People get really wound up about names and caught up in the fact that they must mean something, but, well, a lot of names don't. Some of the best-known business names in the world, if you look at them in isolation, they don't mean anything.Some of their name block holds you up. Use things like CheckGPT, I loveCheckGPT, to help you come up with a name. And then once you have that name, get checking your IP.
I had to change my business name fromSorbet to Ethique about three years in, and it was pretty devastating at the time. We had just finished our first equity crowdfunding raise. I had 152 new shareholders, I'd had a lot of press and now we were going to lose all that goodwill and brand recognition caught up in that name. Thankfully it happened then and not two years later but it still sucked and all because I didn't think to check IP outside of my main country. I only trademarked it in Aotearoa NewZealand, not the USA and Australia or in the next two export markets. Learn from my mistakes and check your IP. Carry on the legal stuff. Yeah, eight is where it starts to become real. Set up your business structure. Most of you are probably gonna want to have a limited liability company or a corp, but you will have to check what works best for your business wherever you are in the world.Think about things like reporting and tags and how big you want to grow and get legal help if you need it. But really, for the most part, this bit isn't too complicated. If you're in Aotearoa, visit the company's office for a walkthrough. Australia, same thing.
Step nine you can skip if your business is something you can bootstrap. Step nine is financing your business. So what is bootstrapping? Bootstrapping is just funding your business from your own fund and then when it starts to generate revenue, funding it from that revenue. Some of the best businesses in the world are bootstrapped like MailChimp and Spanx.Capital raising is this weird measure of success that we seem to celebrate but really businesses that grow without outside money, they should be applauded.You can also look into things like grants, banks, although they're notoriously unhelpful for businesses despite what their cute slogans will tell you, crowdfunding, angel investors, but always ensure the provider of the money is on board with what your vision and mission is, otherwise you are in for a world of pain. Now finally, the last step is to build support around you. You may not be able to afford to have a team yet, and that's okay, support comes in many forms. Advisors, board members, though I very rarely recommend boards for early stage business. I find they just slow things down. An advisory board is a much better idea.
Your friends, family, whoever wants to support you, whatever it takes, know that you cannot do this alone. Building a startup is a marathon. It is hard. It is lonely. You need support, even if you're just getting someone to take you out for a coffee and a randy for now and then. If you can afford to build a team, make sure you hire people who balance out your weaknesses and not just a clone of you which is definitely what you gravitate to. The thing that moved the needle the most for a tee was when I hired people way cleverer than me who had way more experience. They made all the difference in the world. So now you have no excuse. The next steps get a wee bit more complicated but let's worry have no excuse. The next steps get a wee bit more complicated but let's worry about those later. Off you go and change the world.
