Top 5 Considerations for Start-Up Success
A couple of weeks ago we had Claire Robertson from the Founders Institute (FI) speak at the Australian Web Industry Association's monthly meeting (Port80) in Perth. Claire is an amazing person who loves what she is doing and is very good at it - I could tell this 5 minutes into the 'elevator' pitch where the passion for what FI is doing here in Perth was still flowing strong!
One of the things that stood out was that as part of the FI programme, various successful start-up CEO's were invited to share the 50 things they believed were essential to start-up success.
This got me thinking. I have plenty of things that I wish I had known when starting up, but am I successful enough to share those with others?
With success being quite a variable term, it's hard to say if I'm successful or not. I haven't yet achieved all I want to, but then I am in my 7th year of operating this business which I have built from the ground up without borrowing any funds or receiving any kind of investment. I work with clients in the UK, Romania and of course Australia (currently WA, QLD, NSW and VIC) in over 50 industries, discovering ways to improve their business processes and build a strong online presence for them.
In many respects I am successful and the intention of the above is not to 'blow my own horn' so to speak (after all, it's no secret that self praise is no recommendation), it's simply to set the scene as to where I am at and you can decide for yourself how much weight you give to the following 5 things that I believe are relevant to start-ups in any industry. Having had absolutely no training in business or marketing, some of these are maybe very simplistic but in my opinion vital none the less.
- Know your Target Market.
It's very easy to waste a lot of money very quickly, particularly if you get paid online advertising wrong, or if you print 10,000 flyers and distribute to an area in which no-one or very few people have any interest in what you do.
Spend some time determining their age, gender, location, average income, general interests, common issues you may be able to solve, etc. In so-doing, you will be able to produce marketing material (including your website) which they find attractive and will lead them to believe you know what they need - which you do because you did your research.
By sending the right information to the right people, you will minimise any time and/or money wastage and enjoy a higher level of conversions. Number one thing in my opinion, know your Target Market.
- Do you have your Exit Buddy?
The turtles in Finding Nemo had an exit strategy, one which involved partnering up. They knew the plan and when the time came, the question was simple.
On a more real and complex level, the question often gets put out there - when should you think about your exit strategy? For those that don't know, the answer is NOW. You should always be thinking about it and working towards it. My business coach correctly stresses that your business is a means to an end, not the end itself.
Not sure where to start? Ask yourself this question. If someone was going to buy this business, or take over as manager, what would they need to know to make the business value as high as possible or make the transition as smooth as possible? My suggestion would be a business that is well structured, organised and systemised. A business which has a good client base, consistent turnover and passive income streams. You may think of more or different things, but either way, build your strategy now and work towards it.
- Organise and Systemise
As mentioned above, Organising and Systemising are part of ensuring your business runs in a smooth and consistent manner. Organising and Systemising your business is not a quick task by any means, but here is my suggestion.
Think about what your business will look like when it is running to its full potential. Will it have 3 employees or 30? Build an organisation chart which is not based on people in your organisation, but the roles that your organisation will have when it's running to its full potential. Make a box for each role and link them up appropriately.
For each Role, work out every task that will be required of that role. Let's call these Responsibilities. These could be things such as Answer Phone, Quote on New Business, Host Meetings, etc.
For every responsibility, write a document explaining how to do it. This is called a System or a Work Instruction.
Why bother? Imagine you need to free up some time and you decide that you will employ an admin officer to take all the admin off your hands. Everything that new employee needs to do is documented (basis for a position agreement) and how to do each task is documented, enabling them to quickly learn how to do the job in a way which is consistent with how you have been doing it.
Doing this will add value to your business and ensure smooth transition of roles if and when the time comes - sound a bit like an exit strategy?
- Build a Big Chook Pen and be Passive
I thought I'd lump two things into one here as they are sort of related anyway. Two mistakes I made early on were that I had no passive income streams and I had all my eggs in one basket.
When the GFC hit, this one client who had been providing what seemed like endless work for 3 years had to put projects on hold. This resulted in virtually no income for a few months while I had to somehow find some new clients. With no marketing in place and very few other existing clients, it was a hard slog to generate new clients and the recovery period took years.
Never take your existing clients for granted, continue to market and make sure that you have a diverse range of clients.
Additionally, building passive income streams will mean that when there are times of reduced workload, money is still coming into the business and allowing it to operate. Determine how much money the business needs to generate monthly to operate effectively and set this as a target for your passive income.
- Selective Networking
"It's a great networking opportunity". You've heard it countless times before. It's a sure fire way to get people to attend your event. Let's get something straight here... An event with 500 people is not a great networking opportunity if not one of those 500 people are in your target market or are regularly in contact with people in your target market.
All I'm saying is that before you invest your time in attending an event. Ask yourself these two questions: Will there be people in your target market there, and if not, will there be people who are regularly in contact with your target market? If the answer is no, it's not networking it's socialising and you should decide if you will attend on that basis.
Being selective in the events you attend will save you time and money, and will increase your chance of generating new clients.
Wow there's so much more that could be said, so many more things that I wish I had have known, but for now let's leave it at the top 5! What are some things that you have learned and are the above helpful? Feel free to leave a comment below!