7 things I wish I’d known when launching a startup business
When I was 23 years old, I started a social media company. I was optimistic, passionate about my vision and had $10K to bring this website to life with all the bells and whistles. There was one problem. I knew nothing about starting a business. Because of this naivety, lack of experience and lack of research, it was doomed from the beginning. Fast forwarding to 9 months since that inception, it flunked. I lost sleepless nights (juggling my full time job), lost all the money I invested and made absolutely nothing… Or so I thought at the time.
Many years later, I’d like to think that I’ve gained over $10K worth of experience from that failed venture. It’s a hefty price tag (and a route I don’t recommend) but am now reaping the rewards by applying my learnings to my current businesses and the businesses of my clients.
Below are the seven tips I learnt that surprised me when I started my first business. Hopefully you can use them to your advantage and not make the same mistakes I did.
1. Never think you’ve done enough research
So I’ll put it out there. I thought I could merge all social media channels in one portal. A fully integrated social media platform. That was the idea. Of course, I blind-sided myself because channels such as Facebook, Twitter, and Myspace at the time all catered for specific experiences and demographics. Plus, needless to say, although growing companies themselves, they were already powerhouses with multi-million dollar angel investment funding compared to my little venture.
Go above and beyond when it comes to research, especially when it comes to the existing market and your competitors.
Facebook were well ahead of the game and being the first in market can usually be enough to crush any challenger.
2. Get a business coach
This one’s pretty clear cut. I really wish I got a business coach sooner rather than later, or at least a mentor who could guide me through the startup process. From managing funds to investing in the right places and being more strategic with finances, I failed to realise that everything goes back to the business and that every business decision must be to help the business grow. This includes having as minimal overheads as possible.
Now, I’m glad that I’m surrounded by people with multiple businesses that are flourishing at a rapid rate. This helps me continue to learn and make smart decisions, and you can implement this too, with ease. All you need to do is ask.
3. Work with a team of experts
Delegating is one thing, but having someone that not only understands the brief or task but goes above and beyond, and improves what you’re after is rare. These people as we know, are called experts. And we don’t hire experts to tell them what to do, we hire them to tell us what to do.
So rather than going down the cheap route hoping for a mansion, pay the value of what will make your business succeed. The time I wasted constantly briefing a cheap web development company back and forth was a far bigger loss than if I was to brief the project only once to an expert who could then add extra value by taking it to another level.
4. The budget ratio of product costs vs marketing costs
As a general rule, the product cost (or the cost to set up the business) should be 5% of the pie. The pie being your capital (funds to start the business). And the other 95% you may ask? Well, that should go to being ‘seen’ and ‘heard’. I made the mistake of doing it the other way around. It’s important to allocate a large amount of the pie to marketing costs.
Yes, there are free ways to market your product or service including writing guest blog posts, building a social media presence, and word of mouth. That will always be part of marketing 101 and should be constant. Complementing this, I recommend integrating a creative communications strategy to really cause market disruption. It’ll be worth it if you are hyper-targeting the right customer, at the right place, and at the right time.
5. Have a business plan for the long-term
You need to write a business plan. I actually managed to avoid this and look how my first business ended up. There are plenty of sources on Google that can help you write one.
This is a crucial step before spending one single cent on your business idea. Once it’s written (including all financial estimates and projections), you need to commit to the roll-out long-term. If you can’t commit 100% then save yourself the time and effort. It will be hard work, but you have to be all in.
6. Make money from day one
I was content with making money later down the track. This was a huge error of judgement.
Instead, I should’ve integrated multiple income streams within it, rather than going for a ‘big sell’ months down the line. There’s no reason why I couldn’t of made money the moment I launched. I could’ve implemented affiliate programs related to my brand, offered low-cost advertising, sold digital products or memberships for a niche market. The list goes on. I ‘could’ve’, but I didn’t, because I didn’t know how. Which is why I’ve highlighted the points previously mentioned.
7. Refining the product or service
Being agile and adapting to the market is a must. However, it doesn’t have to be a nagging beast. Constantly improving your product or service is a good thing and will help your business succeed. As people evolve, so too must businesses. We need to always ask, ‘what problem does the world need solved, that you as a business can provide the solution for?’. You’ll find that the answer is constantly changing, therefore, so too must your offering.
The idea of starting a business is incredibly appealing. I mean who wouldn’t want to be your own boss, set your own rules, pursue something you’re passionate about, and all the while making good money (ideally even passively)? That’s the dream!
However, it requires more than ‘hoping for the best’. I can tell you now, wishful thinking isn’t a strategy. But can be done. We just have to understand that there’s a difference between effectiveness and efficiency. Tim Ferriss, Author of the ‘4 Hour Work Week’ says “Effectiveness is doing things well. Efficiency is doing the right things in the right order”. I was doing neither of those things, but am happy that I’m implementing them now, even if I did have to learn the hard way.
What are some tips you have that help your business thrive?
Award-winning Australian recruitment agency, Firebrand Talent, ignites the careers of digital, marketing, creative, communications, advertising, & media talent. If you are looking for your next career move, check out the jobs we currently have on in Sydney & Melbourne.Back