Set Up Your Startup Business for Success
Updated: Jul 18
7 things to do before launching a new entrepreneurial venture
Starting a business is an invigorating and challenging path. It requires a tremendous investment of time, energy, and money, and your startup business' success depends largely on the preparation and planning you put in before launching. This blog post outlines seven essential steps to take before starting a business to encourage your chances of success.
1. Conduct Market Research: First, identify a gap in the market and determine if there is demand for your product or service. Market research will help you validate your business concept, understand your target audience, and evaluate your competition. There are countless methods to conduct market research, including focus groups, online surveys, and competitor analysis. This quantitative and qualitative analysis can help you determine if there is a market for your product or service, what your target market is longing for, and what might differentiate you from your competition. IBISWorld, U.S. Census Bureau, and the Bureau of Labor Statistics are just a few places to research your business market and competition.
2. Create a Business Plan As a roadmap for your business that outlines your goals and expected outcomes, your business plan will help you think through the steps and strategies to employ as you navigate unexpected and complicated issues. It should include a detailed description of your business, its financial projections, operations, and marketing strategies. A well-written business plan can help secure funding and ensure that your business is on track. It's important to be as detailed as possible in your business plan, including projections for revenue and expenses, marketing strategies, and a clear plan for growth. Any business plan book by Rhonda Abrams will serve you well if writing your first business plan.
3. Secure Funding
Launching a business usually requires a significant investment of capital. You can secure funding through personal savings, loans, or investment from friends and family. One viewing of the show Shark Tank proves how important it is to understand the different funding options available to you and choose the one that is best for your business. For example, if you need a large amount of capital to launch your business, you may consider seeking investment from a venture capital firm or applying for a loan from a bank. On the other hand, if you're starting a small business, you may be able to fund it with personal savings or by seeking investment from friends and family. Start by creating a household budget for your family and review your monthly expenses to create a realistic picture of your financial condition. Most businesses fail due to undercapitalization, so get comfortable with tools like cash flow spreadsheets and balance sheets. Consult a bookkeeper or accountant if your finance knowledge is lacking. Hire one who is willing to educate you about how to analyze and manage your cash flow and strategize with you about spending money wisely without overleveraging your personal assets. Plan to pay yourself a salary (unless you can live on the income of a spouse or an inheritance).
4. Register Your Business
To legally operate your business, you'll need to register it with your state or local government. This process can vary depending on your location, and it's important to research the requirements in your area. This may include obtaining a business license, registering for taxes, and acquiring any necessary permits and insurance. The SBA (Small Business Administration) offers resources for how to determine the registration requirements for your state.
5. Build Your Team
As your business grows, you'll need to hire employees to help you manage operations, marketing, and other essential functions. Think of the duties and responsibilities you feel most outside your depth (or simply find unpleasant or boring). Over time, plan to build a team of professionals with the skills and expertise you need to upscale your business. When building your team, consider the budget you have available for salaries and whether you would be better served hiring contractors for certain responsibilities. You may want to consider hiring employees who can perform multiple functions, such as a marketing specialist who can also manage your social media presence.
6. Establish Your Brand
Your brand is the image and reputation of your business. It should reflect the values and vision of your company and be consistent across all marketing materials and communications. Be willing to invest in branding professionals if this skill set is beyond your ken. When establishing your brand, consider the image you want to convey, your professional values and vision, and the target audience you want to reach. Creating a logo and a tagline that can help build recognition and differentiate you from your competition, but they are just the external expression of your brand. Anything that represents your company – how you treat customers and employees, respond to complaints, communicate over the phone or in emails or texts, etc. – is a building block of your brand.
7. Set Up Your Business Infrastructure
This includes setting up a website, establishing a legal and accounting structure, and acquiring any necessary licenses and permits. Your website should be professional and easy to navigate, and it should provide all the information potential customers need to know about your business. In terms of accounting, you'll need to keep track of all your revenue and expenses, and you may want to consider hiring an accountant to help you with this. You'll also need to obtain all the required licenses and permits specific to your city and state. Most states cover these requirements on the website page for their secretary of state, but individual cities might require separate business licenses. For instance, Oregon’s registration and licensing requirements are covered at Oregon Secretary of State web page, but you will find the city of Portland’s business licensing requirements on the City of Portland website.
Kristin Schuchman, MSW is a business coach, career counselor, and author based in Portland, Oregon who works with creative and mission-driven professionals. She writes resumes and coaches individuals seeking support for career indecision, next steps, work re-entry, advancement, starting a business, and work-life-balance. She offers a free 30-minute Zoom or phone session and presently works with clients in-person in Portland and remotely. You can find her books The DIY Website Workbook and Jump Start: How to redirect a career that has stalled, lost direction or reached a crossroads on Amazon.