Updated: Sep 21, 2020
In today’s technological day and age, as long as you have a device that can connect to the internet, theoretically, it’s fairly easy to start a business. However, approximately 50 percent of all businesses fail in the first five years, and for those that make it past five years, a large majority never reach their potential of harvesting for investors. So, if the odds are against you, is it not worth taking the time to truly understand how to navigate these treacherous waters?
Taking the time to do your homework, conducting the necessary research, analyzing the financials and finding the right business model are all vital steps if you’re looking to start a business. Otherwise, you’ll find yourself two to three years down the road having to spend your money trying to learn these steps after the fact.
Would you run a marathon without practicing? No. So why treat your business model any differently?
Instead of rushing into entrepreneurship, try taking the slower and more methodical route that will result in success by following these steps.
STEP 1: Is the idea or the business model investable?
How do you know when you have an idea worth chasing? How do you know if you should go all in? So often entrepreneurs think they have the next-best-thing when in reality, it doesn’t even quality as a one-hit-wonder.
Many entrepreneurs assume they have a good idea because they have not heard of it before, it has a catchy name or it comes in nice packaging.
However, truly analyzing the product or service and the market fit is essential. The willingness to critically think through the idea and business model is key.
Ask yourself the following questions:
What problem do you solve?
How do you solve it?
Why are you the right person to solve it?
Who are you solving it for?
Is the target market big enough?
Can you do it for less money than you can sell it for?
STEP 2: Are you willing to put in the work?
While many people have the necessary traits to be an entrepreneur, not everyone is willing to do what it takes to become one. When it comes time to create traction, secure sales and raise capital, not all entrepreneurs are willing to play those games.
This journey will require:
The willingness to deal with uncertainty. As an entrepreneur, you must be willing to take risk and deal with uncertainty, finding comfort were others would give up. It requires a willingness to challenge the unknown and be creative in finding solutions.
Be focused on the outcomes. As an entrepreneur, there are many challenges, and more importantly, a lot of distractions. The ability to stay focused and remove distractions is critical to success. More important is being laser focused on the specific outcomes that are in alignment with your ultimate vision for your company.
Having ideal beliefs. When you spend your days operating from a place of policy, it provides a foundation upon which you can develop strategies and execute tactics. With ideal beliefs, you build a foundation upon which you can develop personally and professionally and create success for your company.
STEP 3: Execution
It is important to have a strategic plan, in addition to a business plan. While a business plan shows that you know how to research, a strategic plan demonstrates your ability to think critically. You are willing to ask questions, probe issues and do your homework. You demonstrate that you understand measurable outcomes and you know how to put together a playbook for a team to execute. Once you put the playbook together, it is important to execute and execute often.
STEP 4: Be investable
What it means to “be investable” varies, but overall, you must:
Be willing to deal with uncertainty
Be willing to stay focused long after the initial excitement wears off
Be willing to execute based on outcomes, not feelings, emotions or desires
Be willing to be creative and innovative
Be willing to take advice and coaching
When an entrepreneur begins to demonstrate attributes similar to those above, he or she can truly begin to grow and create an investable identity. From this identity, the adequate mindset is established and this mindset lays the foundation for the behaviors and habits to be successful as an entrepreneur.
By having these types of attributes, you stand to have a fighting chance for growth and success in your business. Before you rush into starting up, know and understand some of the steps necessary to create success through an entrepreneurial endeavor.