Starting a business is no uncharted territory – almost every inch of it has already been conquered.
But not everyone was able to write a successful conquest; most of those who tried failed. For there is a universal truth behind the stories of those who were fortunate: success doesn’t come easy.
There’s a ton of things businesspeople considered before they laid the first brick of their empire. But there are some things most people tend to overlook that can actually become cornerstones for success.
What are the key components you must consider when starting a business?
1. Overcoming Fears and Struggles
Every single person who had ever started a business knows all the grind it comes with.
You work 80–100 hours a week for years to come, and becoming profitable may take 6–12 months, if not over a couple of years.
Sure, lifestyle or freelance businesses may work. You have to deal with the feast and famine cycle all the time, negotiate over delayed payments, purchase all sorts of equipment or software yourself. There’s no guarantee at all, of course, especially in competitive markets (like web design/development or marketing).
The Reality Behind Success Stories
Even if regular employees read success stories by billionaires or actionable tips on starting a business in blogs like Forbes, Inc., Entrepreneur, they usually have a few people in their network who went on their own.
Some made it after sacrificing their lifestyle or jeopardizing relationships. Others still recover from the journey after starting a regular job just like everyone else.
While success stories are heavily promoted by media, people are usually smart enough to realize the fact that success doesn’t come easy.
Dreaming about the thrill of “running the show” and “being your own boss” is exhilarating — but not beyond the reality of paying your mortgage or rent and relying on your monthly paycheck.
My First Business Challenge
Building recurring revenue was my first business challenge. Bootstrapping the business was possible due to 2–3 freelance leads I took over, but none of them was looking for a long-term maintenance contract.
This led to the feast and famine cycle for a while. This was supplemented with training courses for large enterprises that required 2–3 courses a year, adding up to a decent income while I was generating leads for the company.
With time, increasing the revenue, building processes, streamlining project management, recruiting people, dealing with finances became top of mind for a certain period of time. It’s a never-ending loop of common business challenges (which I’ve listed down and explained) popping up in different stages of the business.
If you offer a service in a competitive market, lead generation is often a pressing problem. In a “high demand” skilled market, hiring top talent is extremely rough.
Motivation and time/process management is rough when working with dozens of unskilled employees.
There are different techniques that work in every stage of the process.
2. Discussing With Your Potential Business Partners
Lay down your expectations and strategies before you jump in. The following are the top three things to discuss with your comrades:
Roles And Responsibilities
Launching a business covers a broad set of activities, from sales and marketing through technology and process management to legal and accounting.
Defining your roles is the number one topic potential founders should go through. You want to ensure that:
The more capable person is in charge of each core objective.
Your workload is distributed adequately
Each activity is assigned to one of you and there’s no overlap (i.e. “shared responsibility”)
Investment And Profits
Most businesses can’t be bootstrapped entirely. Even if they can, starting with some marketing/ads/PR budget may be a good idea.
Founding the company itself costs some, and so does the annual accounting, potential legal fees, equipment, office expenses (if needed), etc.
Deciding on the right ratio between investments and profit allocation is inevitable.
Losing a co-founder may be devastating for a growing business. The leading reason for this is a misalignment between the initial goals and the long-term roadmap/opportunities.
While this is traditionally covered in a business plan (plus the encompassing business agreements), it’s often neglected in startups.
Ensuring that the long-term vision is agreed upon by both parties is required for the first couple of years of grinding and struggling to generate some revenue.
And don’t neglect the biggest business problems companies face during their lifetime.
3. Validating Your Business Strategy
Validating a business strategy is a combination of data, understanding the market landscape, and plenty of luck.
Data is obviously the driving factor for decision-making purposes. If you want to sell 500,000 copies of a niche product in a country with a population of 1,000,000, it’s outright impossible.
Some concepts are straightforward. Just as axioms in mathematics. Others, however, would require some industry research from different places.
One of the problems with data is the odds of drawing the wrong conclusions. If your attention is in the wrong metrics, you will miss the point.
Which is exactly what media does with partially quoting politicians lacking the full context. Or contradictory studies that seem to be conveying two contrasting points.
Knowing your marketing inside-out is extremely important. That’s why most successful businesses were founded by industry leaders. Or at least people who have a large network of consultants, advisors, analysts.
Even with the right global data, context is important.
There’s science behind organizing the shelves of a supermarket or a clothing store.
Picking location for a restaurant follows certain rules but warehousing has nothing to do with them.
Even digital strategy for SMBs vs. enterprises is hardly relevant, at all.
Bonus points for recognizing trends or mapping business network relationships which may or may not help.
All things considered, luck plays an important role, too.
If you’ve read anything about risk management, you’ll quickly enumerate dozens, if not hundreds of factors that could smash a business. Even if you do the right thing, timing and context matter, relationships do, and the ability to rely on external factors means you hope for the best (for as long as possible).
An earthquake or even an electrical problem can lead to a major outage for your business or worse.
Adhering to these rules will help you validate a business plan, but whatever the verdict, the outcome is hardly predictable.
4. Finding Your Niche
Going into a business for the money alone is a recipe for disaster.
It takes time, sweat, and often tears, and everyone pursuing money alone will give up soon enough.
The two viable options people have are:
- Finding the uncovered opportunity at your day job, inner circle, or another revolving problem that has the potential to tap in and exploit
- Discovering a painful problem you’d love to work on — a hobby of yours, a personal struggle, a limitation within existing solutions.
The first portion relies on your lead generation perks.
Finding The Uncovered Opportunity
Finding a reliable channel that will skyrocket your efforts, existing clients you have, intellectual property to be reused, or another lucky charm in your arsenal.
A less likely bet, but certainly doable.
I’ve met business owners who took advantage of a multinational corporation closing a local office or shutting down a product. They manage to negotiate lucrative terms, utilize work already paid for, connections in their corporate address book.
Being the only capable person in a niche skill in your area or personal network definitely helps. Just imagine the small-town doctor or its pastor.
As for the second part of the equation…
Discovering A Painful Problem
There was Yahoo before Google, and so was Firefox before Chrome, and Internet Explorer prior to Firefox. In fact, Internet Explorer dethroned Netscape, the most popular browser back in 1997.
This is where a niche solution comes in handy.
Business owners try to be the best in a category or the first in one.
Starting a new product category is expensive and takes time. iPads weren’t the first tablets in the market — in fact, they were really late to the game. But it took a decade for technology to evolve enough and users getting comfortable with smartphones.
But new smartphone and tablet vendors come up occasionally, stealing a portion of the global mobile market share. They compete on price, on screen resolution, camera quality, available memory, NFC, Bluetooth, you name it.
They build upon existing foundations, improve upon some of them, and hope to build a loyal following as a result. The broader the audience, the easier it is to become a trendsetter in certain categories.
No playbook will reveal the complete breakdown of launching an 8-figure business in a month. Otherwise, everyone would do it, the market would soon become oversaturated and the magic would be gone immediately.
It takes creativity, paying attention to pain points, and trying to leverage your skills, expertise, network, background, or other personal and professional traits of yours.
5. Being Process-Driven
Every single organization uses processes — the young ones simply don’t realize they do.
Even basic activities like “Turn on the lights when you open the store” and “Make sure the AC is off before you leave” are simplified workflows.
Of course, there’s a difference between “We do a few things this way” and “Everything is entirely process-driven”.
Processes are usually introduced as the organization grows. There are several good reasons for that:
- Key players get busier with fewer day-to-day activities.
- New hires need to align with the way the business works.
- Different people in similar positions may deliver varying results.
- It gets more expensive mentoring new people than investing in common knowledge.
- With time, remembering tons of workflows gets nearly impossible (Google “institutional knowledge”),
- Establishing processes often requires new tooling or process optimization meetings. This may be challenging for inexperienced hires used to “freestyling” it.
It often involves a bit more paperwork, too. Filling out additional reports, noting new process additions in a wiki/document sharing repository. Taking an occasional unnecessary step “just to be safe”.
The larger the company, the more the new processes, the higher the risk certain individuals will feel uncomfortable.
This is why management should be really transparent as to why processes are introduced. A common (shared) goal is to be achieved for a process to make sense.
Can You Sell Your Ideas As a Business Venture?
As a final note, let’s talk about ideas. To be honest, I know a lot of people who were more creative or you may say they are kind of dreamers they have lots of faith in some ideas they come up with and they say “Oh gosh if only I had the money and the team and you know the resource and the networks and I was going to make that idea a reality”.
So, some of those people they want to kind of work as something that you know you may label it as idea generators you know people who come up with great ideas and just sell them and make a living out of that.
But in reality, ideas, you know don’t really matter that much and ideas aren’t worth as much as you can think unless you have the right procedures in place unless you have the right environment, the right context and the right ability to make consequences, pay for that idea and generate the right return on investment.
And I try to answer this question, so I came up with a list of the “10 main things that a startup needs in order to make an idea worth something.”
Want to learn about them? Check my video here: