Everyone has at least one great idea in them – most people have hundreds. Most of these ideas are small: I should cook my partner a dinner, I should take my kid to see Star Wars, and so on. Some of these are ideas are bigger; these ideas are about how you are going to cook that dinner for your loved one or how are you going to take your kid to the movies.
That’s how the most successful businesses around today – businesses like Blue Apron and Uber. That’s the first step to making a successful business: the combination of idea and opportunity. And, of course, the initiative to act upon observed opportunities.
While both idea and opportunity are important, if it was the only way to become rich, we’d all be Mark Zuckerberg, right? The third part of the startup Holy Trinity is a business plan. More often than not, the Business Plan is where most entrepreneurs fail. To the uninitiated, a business plan can seem as complicated as theological doctrine but in truth, it is only as incomprehensible as you make it.
As market specialists, we thought we’d provide a resource for the entrepreneurs out there looking to launch a startup. First, we will cover important questions you should ask first yourself and then potential partners; second, we will discuss the actual elements of a business plan; finally, we’ll wrap up with actionable steps you can take.
What You Need to Ask
There are a lot of important questions to ask before launching a business. They vary from industry to industry (as a tech company, we’ll be looking solely at our native sector) We’re not going to cover all of them, but we’re going to dive deep into a few of the most important questions.
1. Why Does Your Idea Matter?
Why will people want or (better) need to use your app, website, SaaS program, and so on. What makes your product the superior solution to all the others out there? You need to sit down and figure out if your idea helps people. Be realistic – even better, talk to someone else about it. Of course you think everyone will love your idea – it’s your idea!
2. What’s My Market?
Who will be interested in your idea? Old, middle aged, young? Hipsters, Yuppies, Country folk? Everyone? Figuring out your market will allow you to create a tailored market strategy (send our marketing specialists your questions for a free one on one consultation!).
3. What Resources Do I Have?
There’s the obvious one – how much cash do I have? You have to take a realistic look at your financial situation. But this question is about more than money. Other resources you will need to assess include personnel, equipment and even your knowledge level. Figure out what you have, what you will need to begin with, what can wait until later, and what you don’t need. Remember, you don’t have to do everything right way – be realistic and allow your startup to grow.
What Your Business Plan Needs
This is the nuts and bolts of every good business plan. This is what you need to be successful – it helps you figure out what your startup is about and it helps you explain it to other people – like investors!
• The Executive Summary
This maybe the most important part of the entire plan. It’s your first impression, and more importantly it’s probably the only thing most people will read. It needs to be eloquent, without being wordy; it needs to descriptive, but brief; and it needs to encompass your company, your mission, and your strategy.
• Analysis of the Market
You figured out who your market was during the as one of your first business questions. Now it’s time to write it down and back it up with your research.
This is also where you figure out what your competition is like; who’s done what, what was done, what is done well, and what is not. Every investor will want to know about this, and it will help you understand your market all the better.
• The Financials
A cash flow plan lays out in plain english (so to speak) how much money you have, how much money your startup will need, and how much you can expect out of it in the first few years. This will help give you a realistic idea of your financial standing and what you need to succeed.
Financial projections will tell you how much money you can expect to earn in the first 3-5 years of your startup. A business financial plan will also help communicate your expected revenue to potential investors – a much needed asset when seeking funding.
What You Can Do
One thing every business needs is cash. There’s no escaping it. Most of us don’t have a bunch of money lying around, so we have to be creative with our budget. The good news is that the tech industry is the biggest investment sector in the world.
In first quarter of 2015, billions were invested in Silicon Valley alone. 2016 stands to be even bigger. This is good news for entrepreneurs out there because it means that investors are just waiting to fund the next AirBnB. As mentioned earlier in my blog, one of the first questions you should ask yourself is “can I fund this alone?” Perhaps the bigger question is “Should I fund this alone?”
Even if you have the cash to fund your startup, you should consider seeking venture capital or angel investment. A business requires money, and a startup requires a lot of money. Fortunately for you, SDI’s specialists can help you develop the perfect pitch to wow investors and our networks extend deep into the world of tech investment.
If you want to get started on your startup, SDI can help you succeed. Whatever your idea might be, we can make it extremely successful. Some of our leading clients are Louis Vuitton, Pepsi, Stanford University. We live, breathe and eat tech and our business is designed to make SMBs, startups and entrepreneurial ventures a hit. IF you have questions or want to get the ball rolling, send an email to firstname.lastname@example.org give us a call at 408.802.2885 today. The world is waiting for you!