Jacob Launching a business is never easy.
The majority of startups operate on loan money and a measure of risk. There’s a skill, marketing, product development, and much stress involved. For those reasons alone, knowing the process is key. You need to understand the right mindset and steps to launching a business.
We’ll explain both below in a 4 step guide. Follow it and enjoy a smooth start!
#1 – Do Your Research
The worst way to start is to have a vague goal in mind, without understanding what the path looks like. So you might have a project in mind, without understanding the resources you’ll need, and the competition you’ll face.
This is where research comes in. You’re not researching the market. You’re making sure that your ideas are good, to begin with. You’re giving them a well-thought feasibility study.
As a rule, explore ideas that involve your zone of competence. That might be a well-developed professional skill you have. It may also be a hobby that you’ve performed well at on an amateur level. Being in a zone of competence gives you the mental stamina required to succeed. It allows you to better endure the difficult work of setting up your business operations.
It also lets you overcome your psychological barriers. If your startup is related to a zone of competence, you’ll be less likely to second guess your business choices. You’ll also have more confidence approaching customers, making sales calls, and diving into new markets. Also, you’ll be less likely to second guess your products after development.
So working within those limits ensures that your products are made with quality in mind. It eases your research, since you probably have an idea of the sources needed for that. Those will include, key influencers and competitors, rising and falling trends in the industry, and what a good product looks like.
A good example of competence is Steve Jobs. Massive success and founder of Apple, Jobs’ entire life experience and passion were in the world of tech. That was his zone of competence and was his base in the startup world. To that end, his attempts at founding Apple stretch all the way to the 1980s, eventually coming to fruition in the 2000s.
#2 – Learn How to Sell Your Idea
At some point, you will need to drag investors into your enterprise. You can’t do so without knowing how to present your business in good light.
This brings us to the presentation. You need to learn how to sell your business on the fly (through natural conversation). You also need to learn how to sell your business in a formal setting. Mastering both lets you communicate with a wide range of investors. So even if you do get rejected by one source, you might still find an opportunity with others.
Even better, knowing how to sell your business has a cumulative effect. It makes you “the founder” part of the brand image. That means when someone networks with you, whether it be for business or other purposes, they will at some point be dragged into your project.
The rules for selling your business are simple. They have less to do with long talk and being impressive, and more with a flow of ideas that promises something constructive. You can summarize your presentation in the following acts:
- Hook – provoking your audience’s imagination, either subtly or directly.
- Product Demonstration – this is all about relevant detail. You want to tell your investors what they’re eager to understand about your product.
- Ask – Invite your audience to inquire more or join your enterprise. You can invite them for a collaboration, making them investors of ideas and experience instead of just money!
Finally, make sure that your presentation is natural. Being mechanical and scripted as you present will repel most investors. It subtly signals a lack of passion towards your business, which will make most investors worry about your project’s longevity.
#3 – Learn How to Tell a Story
This goes in hand with knowing how to present your ideas. Stories can even come up when giving a presentation, but there are rules on when it’s appropriate to tell stories.
For starters, you can’t tell stories to someone that isn’t interested. That is, stories are a way to strengthen your ties to an already hooked prospect. It gives them faith in your business. It also helps you relate more with the investor, who has likely been through the hardship of starting their own enterprise.
A good story is an opportunity. It lets you see an investor’s personality. It also gives the investor a glimpse into who you are. This is important because it builds trust that helps you work out and finalize your deals.
Also, keep in mind that getting an investor’s attention isn’t all there is to a story. Consider it the smoothing process that creates a favorable impression. But it doesn’t eliminate worries with regards to how investment funds will be managed.
Going back to Apple, Steve Jobs was noted for being a master of presentation. He had the ability to sell his product to large audiences quickly, outlining what the public wanted to see, and without being complex. In fact, there is circulating literature discussing his presentation skills, predominantly explored by authors such as Carmine Gallo.
#4 – Learn Fund Management and Negotiation
Investors will never give you their money without jumping into the processes of your business. You’ll often see a desire to tweak its nuts and bolts to match its vision. Also, investors will always try to secure the highest returns for themselves, even if that shoots down your income.
This is where negotiations come in. Learn to be firm and decisive, all while being polite. Stay level-headed at all times, and when you negotiate, always have facts to back your claims.
A key tip is to base your arguments on effort, skill, and time. Learn to present everything in an impersonal manner. Focus on the effort required to keep the enterprise functional, and how that represents the share you demand.
Finally, learn the art of closing deals. You’re responsible for the micro-operations of the business (especially when just launching). This means making sure that all the funds you need are wired to you and in a timely fashion!
In a Nutshell
Consider the previous steps a framework on how to approach entrepreneurship.
It’s a long road full of ups and downs. It requires mental resilience and non-stop effort. But with enough faith and time, any entrepreneurial project you start is guaranteed to succeed!
