Entrepreneurship is not easy. But what does it take to start a successful business? A guide for future entrepreneurs.
Run your own business. Being your own boss. Self-sufficiency and financial independence. Nobody telling you what to do and what not to do. We’ve all had this dream at some point in our lives, haven’t we?
Yeah, it’s not quite that simple.
From years of experience I know that many start-ups fail because they only see the fun or the success, but they ignore the really important points. They often don’t consider the amount of work and frustration behind it. It is not enough to have only one good idea. No, you also have to get behind it, be persistent, develop concepts and plans and keep at it, be prepared for setbacks and have patience for your project.
To successfully start a business, you need to think about it and make some decisions in advance.
The idea for your own company
As an entrepreneur, you only have success as long as you can satisfy an existing need with your products or create a new need. Enterprises, which want to assert themselves again at the market, must make certain thus that their products either fill a gap in the market, revise and improve already existing products or concepts of other companies or produce qualitatively high-quality articles. An equally popular strategy is to produce and sell at low prices. This contrasts with the ever increasing and steadily growing environmental awareness of people. Only in the rarest of cases is it possible to be significantly environmentally friendly and cost-effective. Since the environmental factor plays an ever increasing role in production, it is a good opportunity to build up your company with the aspect of sustainability to stand out from the competition. (Disruptive business models)
It is essential for the continued existence of the company that at least one of these points is realizable. This should be taken into account when the company is founded.
QuickSpeech has managed to satisfy an existing need and to improve existing concepts with its app. The product is a knowledge transfer app with which companies can easily support their employees and apprentices in their internal training and education. Since companies are constantly looking for the most innovative and best ways to train their employees as quickly as possible, there is definitely a market for this type of product. What’s new about QuickSpeech is its focus on young people, for whom the learning content is specifically designed and developed.
You can have the best idea in the world, but if you do not succeed in finding sufficient sources of money, the dream of independence will fail while it is still in the making.
Of course it would be ideal to be able to finance your own company exclusively by yourself and to live from your own cash flow in the future. This would be the best case scenario, but in reality this is not always easy. Usually at the beginning an investor network such as primeCROWD (Austria, Germany), SICTIC (Switzerland) or Business Angel Network Germany (Germany) is integrated, shareholders are sought or a loan is taken out. An alternative to a loan would be a fundraising campaign. This includes sites such as Kickstarter or the investments of business angels. A fundraising campaign is started on average every one and a half years. However, it takes about half a year until the amount of money is reached and distributed. A fundraising campaign should therefore always start in time before the money runs out. A financial plan, regular liquidity plans and the ongoing recording of expenses and income are essential to detect insolvency at an early stage and take steps to prevent it.
Motivation for founding
Why do I want to start a company at all?
There can be a wide variety of motivational reasons, ranging from the belief in your own new product, to the exciting and interesting environment of the start-up, to the desire for financial or professional independence. To start a company for profit-oriented reasons is definitely possible, but should not be the only reason. Especially with the intention to run it on a long-term basis instead of selling it for a lot of money. Even those who prefer to be their own boss must be aware that this does not quite correspond to reality. Even as a company manager you are forced to consult with others and make compromises. Especially when it comes to strategic decisions it is necessary to coordinate with participants, investors and stakeholders.
My time at whatchado has shown me how important initial motivation can be. Although there were also sponsors, it was hard to believe how much resistance there was from experts, but also from friends and family.
“What do you need him for?” | “No one will care.” | “You won’t succeed with this!“
Yes, we have often heard such sentences. But despite the criticism and doubts we did not give up and continued. If we hadn’t had the necessary motivation, if we hadn’t stood behind the idea with conviction, then whatchado wouldn’t exist today.
Planning and implementation
Conscientious business and daily planning can be the key to a productive and successful company. But where exactly does planning actually begin?
Before the work planning begins, it is essential to select the optimal company location. If you make a mistake here, you will probably be forced to move after a short time. To avoid this, there are some criteria that help to choose the right company location. To a large extent, the ideal location of any company depends on the idea. Apart from that, the competition, partners and image are also elementary factors. Depending on the product, the target region can also be decisive.
Once this is done, the search for the most efficient working – and also manufacturing method begins. This point will take some time and creative thinking, it will also be constantly evolving and changing. Although it is by no means necessary to always upgrade to the latest machines, tools or techniques, it is not necessary to forego modernization completely.
Marketing and market research are also something that will be worked on continuously. First comes the definition of the marketing goals, where the company stands and where it should go, what wants to be achieved in the end. Basically a distinction is made between psychological marketing goals and economic marketing goals. These goals can be in the areas of product, online marketing, sales or even communication. Setting precisely scheduled, structured and just as realistically realizable goals is something that companies of all sizes should do. In this way, it is possible to use resources in a more targeted manner and in the best case even save them. Once defined goals are in place, the next step is the concrete selection of marketing strategies. There are a number of different strategies, such as social media marketing, guerrilla marketing or influencer marketing. It should be noted that each goal requires its own strategy.
I personally use the term marketing mix, a standardized process of simultaneous or sequential online and offline activities to achieve my goals regarding market penetration and brand awareness. This includes a conversion-optimized website, social media marketing, SEO & SEM measures, media campaigns, speaker appearances at events and above all personal recommendations. However, a profound market and competition analysis, the “Effective Research Process”, as I call it, remains the decisive factor. This aims to study the competitive environment in detail, both nationally and internationally, to evaluate the search behavior of customer segments and to analyze the online presence of competitors with programs like SimilarWeb.
In addition to the marketing strategies, the selection of the sales strategy follows. As soon as a salesperson comes into play, for example in B2C and especially in B2B, these are necessary. Depending on product, individual buyer and setting, the strategy varies. Many people think sales is about manipulating the customer, in fact it is about convincing the customer. Sales strategies are mainly based on psychological backgrounds and behavior, the difficulty is to find the right approach for each customer.
So to start a successful business you first need an idea that inspires people. The right motivation and commitment to run your company for the long term, as well as selected strategies and the right plans. In addition, with the right location and a reasonable financing, there is actually nothing to stand in the way of founding a company.
However, not only the foundation is accompanied by some obstacles, also the management wants to be skilful, more about this in the next article.
By: Yvonne Maria Göstl & Kambis Kohansal Vajargah