Founding a start-up is one of the most exciting, rewarding, and potentially lucrative ventures you can embark on. However, it is also one of the most challenging.
When you are starting a business off your own back, you will be entirely responsible for its success or failure. There is no one else to turn to for help other than a business partner if you have one.
This can make it a disconcerting leap of faith to make, especially if you have no experience in business beforehand. What’s more, despite the litany of courses that claim to teach you the blueprint of building a successful business, there are always unexpected challenges that crop up regularly.
Your ability to deal with these problems will dictate your start-up’s success. However, this is not to say you can’t go into the business without at least half an idea of the obstacles you might be up against.
Although many entrepreneurs discuss the business ideas themselves (or the great success that stemmed from them), they rarely mention the seemingly minor details that can make or break a business.
This is what you need to know before founding a start-up:
You need to understand a variety of skills
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A hidden aspect of entrepreneurship that is widely underappreciated before starting a business is just how many skills you need to make the company function. Many people wrongly believe that the only skill you need is selling or world-class expertise in a single area. While these are both important, they disguise the breadth of additional talents you need to develop to stand a chance at success.
For example, you will likely need to learn basic leadership, persuasion, networking, copywriting, and marketing skills and accumulate accounting and legal knowledge. This is just scratching the surface of what you will learn when you attempt to grow a business from the ground up, which is what makes it both deeply rewarding and challenging. There are also other elements of business you must become familiar with, especially when it comes to more technical aspects, such as tax and accounting as well as insurance – the latter being crucial for all businesses.
Business insurance covers numerous areas and depending on your company, you may need a specific policy type to protect your firm from all angles. Understanding insurance terminology is, therefore, critical if you want to find and negotiate the best insurance deal for your company. Insurance for your company can help protect against all manners of problems that could otherwise lead to reputational or even financial ruin, ranging from employee and customer issues to legal and financial troubles, as basic examples.
Hone your skills while still bootstrapping
When you first start out in business, progress will feel soul-crushingly slow. This is because it often is. You are building momentum from nothing, generating something from nothing, and pushing the metaphorical rock uphill inch by inch.
This is when you can become desperate for rapid growth or outside funding. Hold fire, though, because you need to be ready when the money comes your way. Use this ‘dead’ time productively by developing your skills and experience levels while no one is watching or relying on you so that when you are ready, you can explode out of the gates and grow quickly.
Be aware of the funding options at your disposal
Even though you should focus on bootstrapping yourself at the beginning, there are still several funding opportunities at your disposal. For example, you could apply for pre-seed investment, giving you a modest cash injection to invest in staff and capital.
Alternatively, you could apply for a business loan from Space Coast Credit Union Business Services or even ask family and friends for a donation. However, be aware that this money needs to be paid back, so be careful when borrowing funds.
Consider buying other companies
When many people consider starting a business, they can only see the mountain of struggle ahead of them. This is understandable because creating anything from nothing is tough – let alone an entity as complex and pressurized as a company.
However, what few people grasp from the outside is how many options there are available to budding business owners. It is easy to be impressed by rapid growth or incredible profits because you think it must only come from a business that has been created from scratch.
This is a misconception because you can scale your start-up more quickly in other ways.
For example, once you have started generating a modest profit and have started putting money aside, you might find that buying an existing business is actually easier and more profitable than expanding your own.
Whether this means buying out a competitor who no longer has the hunger for success or acquiring a company that delivers a service you want to start delivering, the choice is yours.
The result is double, triple, or even quadruple the number of resources at your disposal, along with the clients, reputation, and cash flow of an existing business.
Although this is a complicated process, you could research possible bank loans or finance deals you can strike to make acquisitions easier.
Build a business that can run without you
When you find a start-up, it is going to be your baby. When you think up an idea and go through the grueling process of breathing it into life, you will be entirely responsible for every role within the company – from sales to product creation, marketing to human resources.
However, this is an unsustainable approach. You need to build systems and hire people as quickly as possible to ensure the business runs smoothly without you being there. You could outsource certain tasks and hire freelancers to save time and resources.
A business owner is different from a managing director or a CEO. You are not the figurehead; you are the person who profits at the end of each month.
The sooner you can step back and allow the business to flourish under staff members who are better at their jobs than you are, the faster you will get rich.
