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Starting a new business is a paramount and challenging task as a number of things are required to be acknowledged including legal, financial, marketing, operational, intellectual property, human resources issues and more. While only scratching the surface of all these aspects is enough to take its toll on new business owners.
This is why the recommendations and guidance from industry experts are so highly valued, they are ready to provide you real-world corporate wisdom that might take you years or even decades to learn on your own accord.
As for this blog post, we’re going to discuss some valuable suggestions that can help entrepreneurs set up their new business and avoid the pitfalls normally encountered by so many in the industry.
1. Choose a great name for your business:
Finding the perfect name for your business can have a significant impact on your future success. While a number of legal and business-related problems are bound to follow, provided you have chosen an inappropriate business name.
While deciding the right name, keep in mind to use names that are easy to spell and read, avoid names that could alter your business success over time, and run a detailed trademark search. Or, select the five best names, then test market the name by associating it with potential investors, partners, employees, and target audience.
2. Understand that acquiring the required finances is hard
Raising the required capital for even a small business is harder and time consuming than you can imagine. The reason being it is quite difficult to pitch your business idea to potential investors and venture capitalists and obtain the intended finances. This is why the business owners need to accept the fact that investment in effort and time for obtaining funds is frustrating and rough.
Quit wasting your valuable time to convince venture capitalists and investors for signing the Non-Disclosure Agreement (NDA), just in case they don’t use your idea. Do see that this is rather a counterproductive move and will only elevate the difficulty in acquiring funds. Remember, you will most probably have a hard time persuading investors to invest in your company, and you don’t want to make matters any worse.
3. Emphasize on creating a quality product, but don’t take limitless time:
Agreeably, you might not be able to create an exact replica of iPhone 7 at the inception of your business, however, a ‘good’ product should do just fine. The product must be strongly distinctive with unique attributes than the offerings floating in the market from your rivals.
But be vigilant as to not waste excessive time on getting your product in the market, you can always benefit from an early customer feedback. A startup is considered performing well if it is able to launch an acceptingly valuable product in the market.
4. Become an influential sales personnel:
Presenting yourself as an influential and powerful salesman is one of the major indicators for the success of any business. As a business owner, you are not only obligated to sell your business to your customers, but also to potential investors and future workforce.
The trick is to practice over and over again till you have the perfect sales pitch. Besides that, ask for regular feedback, go extrovert, display confidence, be positive, and practice active listening.
5. Design a great website for your company:
Ask your technical team to invest ample quality time in building you a great and professional business website. The website should be informative and captivating enough to tempt potential customers, partners and investors to go through it and perceive you as a genuine and potent competitor in the market. Follow the below suggestions when designing your business website.
- Inspect the website of top rivals in the business
- Select the best designs and consult a professional developer as to which one can fit best with the nature of your business
- The website should be search engine optimized and mobile friendly
- Pour in high quality and unique content regularly
- The website should present a favorable and aesthetically pleasing user interface and experience
- The website design should be simple, yet attractive and not congested
- Acquire an appealing and easily memorable website ‘.com’ domain name
6. Craft the best elevator pitch:
Your elevator pitch should present a short, but powerful introductory pitch describing your business. However, the pitch content can be changed depending if you are communicating with customers, partners, or investors.
Do note you have to keep the following things in check while creating the elevator pitch: must be effective and to-the-point, a positive and problem-solving tone of voice, should not exceed more than 60 seconds, focus on the uniqueness of your business, voice the solutions your offerings cater, and last, welcome arguments in order to keep the other party engaged and interested.
7. Understand the core financial management principles:
Learning the structure, functionality and importance of financial statements and budgeting techniques are one of the foremost and critical financial requirements any owner should consider at the opening of a new business.
It is not uncommon to see many entrepreneurs trying to keep their head with the competitive pace, and eventually end up failing due to running out of cash.
The intelligence is to create a detailed and monthly or yearly financial plan, and review it on regular basis. While a thorough understanding of the financial statements will help you tackle many tricky questions investors typically ask. Below are some of the common, but important questions investors will expect you to answer.
- What is your business’s near future projections (preferably three years)?
- Are there any vital assumptions that support your projections?
- How much capital you have been able to raise until now?
- What will be the required equity or debt financing for future?
- How much (if any) stock option is available for the employees?
- What is the breakeven point for the business?
- What can be the indicators that could affect your business’s growth?
- What are the most important metrics for your management?
Lara Hawkins is an accomplished corporate trainer primarily aimed to help entrepreneurs establish a top name in their industries. Besides her position as a Digital Marketing professional, Lara also operates Assignment Mode, a quality academic service provider with the purpose of helping students worldwide in a variety of disciplines.
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