Turn your Idea into a Business in 7 StepsSeptember 16, 2014
Do you have an idea for a product and want to develop a business around it?
It’s great to have a money-making product or idea, but without a business behind it, a product/idea has minimal value. Ideas and inventions can change the world but a business has much more value than the product it sells.
7 steps for success
- Pinpoint the exact service your product is providing: Don’t get caught up in your idea. You have to make sure that your product provides a relevant service or solves a problem that relates to widespread consumer interest.
- Find out who will likely purchase your product: Find your market and where your product will sell. The success of your product depends wholly on consumers’ reactions to it, so take time and observe to make sure that your product addresses the needs of your specific audience.
- MVP (minimal viable product): Startups use MVPs to test out their products early on to acquire feedback before putting the idea into the mass-market. Entrepreneurs give out a number of MVPs to a group of select customers to gain insight on what works and what doesn’t work regarding their product. This feedback is instrumental to your success, and the customers will pave the way for the future of your business, whether that is continuing in the same direction, or changing course completely.
- Form a team: Successful startups, more often than not, are run by more than one person. Business partners on your team will support you, hear your ideas, and provide an invaluable second opinion. In addition support from experienced entrepreneurs is invaluable.
- Develop a financial plan: Create a model outlining the cost to build your product and market and sell it. For more long term planning, create a second model detailing how you will reach a profit from the size of your customer base.
- Make sure you have the funds to start your business: You need money to start off, so evaluate your sources of capital, whether it is personal funds, loans, angel investments, venture capital funds, money from friends and family, etc.
- Positivity: There are going to be reasons to doubt yourself, but try your hardest not to question everything. Starting a business is intimidating especially because success isn’t guaranteed, but mistakes and obstacles will be significantly more difficult if you carry a negative attitude.
Refining your business plan
Whether you’ve already constructed a business plan or are looking to edit it in any way, it is vitally important that along with your moneymaking idea, you have a detailed plan behind it. Your plan will be the template for all future ventures within your company so it will need to be revisited periodically.
Things to include:
- Financials: Have realistic financial projections prepared. Include how much you plan to make, how much you will have to put into startup operations, and what your return on investment will likely be.
- Marketing: Make sure that your message agrees with the goal of your business. Decide how you plan to deliver that message, whether that will be through blogs, public promotions, articles, or a website.
- Competition: Include details about your value proposition (what sets your business apart from competing ones).
- Staffing: Research compensation for each position and how vital each position is to the success of your business. Because staffing is typically the most expensive part of starting a business, you will likely need to scale staffing headcount to match your growing operations.
Successful startups depend on hard work, patience, and explicit goals. Once you wake up with a brilliant idea, your work has hardly begun. Starting a business will expose you to unique issues, obstacles, and also tips for future success. You are more likely to succeed as long as you remain patient and stay devoted to your idea.
Contact Anthony Mangiarelli, CPA Chair of the KLR Emerging and Startup Business Services Group.