With thousands of new businesses failing each year, starting out on your own can be fraught with risk of failure.
Here are eight tips from experts, entrepreneurs, and business teachers to help you get the best start.
Avoid procrastination
Starting a new venture is a nerve-wracking. It can also be tempting to keep telling yourself that it is not the right time yet, until everything falls in place for you next year.
But if you are serious about starting your own business, it is better to stop procrastinating and get it on. There can never be a better or perfect time to start your business or build your product.
“The best time to start is today, the next best was yesterday but the worst time is tomorrow. If you wait for the perfect storm of circumstances you’ll never even start, so just go out and do the best you can right now,” says Linda Henry, Director of Youth Engagement at Liverpool FC.
Discover your niche
Most start-ups that survive the turbulent Nigerian business environment explore niche opportunities. It is better to have a niche group of keen customers than to spread out with slim chances of surviving keen competition.
“If you pretend to make a product that will please or make everybody happy, more often than not you end up making nobody happy. You can never please all. A small group of very dedicated users is far better than a large group of indifferent users,” an expert warns.
Market survey
You may be convinced you have the world’s greatest product but do you understand your market? Market survey is very important, and to a large extent holds the key to your breaking into the market and securing a market share.
Expert entrepreneurs advise that starting with a market looking for a solution, or a solution looking for a market, is the best way to take off.
But they warn that “while this can lead to a disruptive or revolutionary breakthrough, you may run the risk of wandering in the wilderness trying to find a customer niche, learning the market’s inner dynamics, and developing a functional go-to-market organisation that generates sales … all while burning valuable start-up time and cash.”
To get out of this quagmire, engage a “co-founder who understands the market as well as you understand the technology.” Two good heads are better than one.
Chase every business lead
When you are a young company you need to chase every business lead, and meet with everyone who will meet with you. You never know where the breakthrough lies or where the lead might get you.
The idea here is that he who is sick needs a physician. So, it is a good idea to embrace every meeting offered to you or that comes your way or the way of others to whom you can latch on to get things going. Do not miss any available lead.
Bring angel investors on board
Angel investors are experienced business people who, as well as injecting finance into your company, can provide mentoring. It is worth deciding whether having one by your side as you launch your business could make all the difference.
Angel investors bring not only early stage finance but also business skills and contacts that can be very valuable to helping businesses successfully grow and scale-up, while offering financial assistance at the same time.
More often than not, angel investors are on the lookout for competent and passionate entrepreneurs who can offer new disruptive products and services in the market and the potential to scale and bring high returns.
Decide whose advice is worth taking. Ignore everyone else
Never allow everyone to tell you how to run your business. Of all those who offer pieces of advice, decide which one is worth taking and ignore the rest.
From your co-founder to your mother, everyone will have an opinion on how you are running your business. Ultimately though, it is up to you to decide who to listen to when making a certain decision.
Knowing who to listen to when you are in a specific bind is the hardest part of entrepreneurship, so be mindful of what decision point you bring up to a certain person.
Fail as quickly and cheaply as you can
“Failure is a sad fact of business life. Products and services do not always work, but when things go wrong it is better to accept that they have failed and move on, rather than keep banging your head against a brick wall,” says Jeremy Basset, Global Marketing Strategy Director at Unilever.
“If your product is going to fail, it’s going to fail. The best thing you can possibly do is to fail as quickly, and as cheaply, as possible so you can get building on the right path.
“Too often people grind and grind and grind, spending tens of thousands or hundreds of thousands of pounds even to get traction when what they should really be doing is going back to the drawing board completely. It’s ok to pivot and start again.”
Don’t exit cheaply
If you are considering exiting your company, it can be tempting to sell out to the first buyer who comes along. But take your time and do not take less than your venture is worth.
Resist the temptation of “fast” money by refusing to undersell your company in a fit of hurry. Instead, slow down a bit and pick wisely a small set of smart investors who value your business just as much as you value it.
Evan Spiegel and Bobby Murphy, co-founders of Snapchat, turned down a $3 billion buyout offer for Snapchat from facebook owner, Mark Zuckerberg, in 2013. Some critics wrote them off.
For the critics, $3 billion for a tech idea dreamt up by a student in a design class only four years ago is commensurate enough to let go of their business concept.
But the former Stanford undergraduates’ disappearing message/image-sharing service has turned a hit with users, particularly 18-29 year-olds, who share 400 million snaps each day.
Now investors valued the app at over $19 billion.