The idea of starting a business is exciting to many individuals. It can be incredibly challenging and rewarding. It is vital not to underestimate the level of commitment required. Analyze your knowledge, financial status and attitude in terms of realizing the business objective. Perseverance and support from family members will transform your idea to reality, making you a start up entrepreneur. Be sure to put a strong foundation and reasoned analysis to make a successful start.
Physical and emotional demands, financial insecurity and loss in advantageous safety perquisites of a company are some day-to-day challenges that start up entrepreneurs face. Evaluate if you fulfil the following key attributes that start up entrepreneurs possess objectively:
- Passionate and committed
- Risk taker and the ability to make quick and sound decisions
- Financially wise
- Team leader and a strong player
- Strong communication and marketing skills
- Thirst for knowledge of the industry
- Customer oriented
- Networking and relationship management
Research your target market, location and the prevailing competition. Work with an accountant to choose the right finance options for sufficient reserves.
Significant Aspects For Start Up Entrepreneurs
- Startup entrepreneurs ought to start as small business entrepreneurs in most cases.
- Start up entrepreneurs ought to research the business proposition by talking to experienced people, gather information from internet and forums.
- Start up entrepreneurs must make efforts to understand the technical aspects of the business. There are books and project reports that provide essential information on every aspect of a business. These include start up costs, business plan, requirements, self-evaluating questionnaires, financial projections, marketing techniques and contact details of people in the business.
- Start up entrepreneurs must be knowledgeable regarding financial aspects of running a business. Number crunching will enable the start up entrepreneur to comprehend the financial position of the company. Cash flow management, raising funds, budgeting, projections, debt collection and adherence to tax standards are some significant financial aspects. Constant focus on bottom line and future financial requirements will ensure that the business will survive in complex situations.
- Start up entrepreneurs must understand the legal and regulatory requirements of the region. Gather information regarding licensing, permits, zoning requirements and regulations for running your business in the city. Determine if you are deciding on a proprietorship or a partnership, business registration, opening of a current account and applying for patents (if, any).
- Start up entrepreneurs will have to recruit consultants and professionals who can guide in operating various aspects of the business. Receive free e-mail counselling or research through the various databases for the required information.
- Start up entrepreneurs need to research and understand the prevailing market for their product. Ensure that there is a regular customer demand for your product. Identify your potential customers, make appealing campaigns to attract them and retain them with your service and offers. When you plan your marketing calendar, the promotions must draw more customers such that you regain your investment.
Finance Options For Start Up Entrepreneurs
Many Start up entrepreneurs choose a mix of the following finance options to raise capital at lower interest rates and reduce their inherent financial risk.
- Start up entrepreneurs can use their own funds or borrow from family and friends. Consider their risk as it could affect relationships, otherwise.
- Start up entrepreneurs can formulate a comprehensive business plan and approach a bank for a loan. Security may be essential if the loan amount is considerable.
- Start up entrepreneurs can attract angel investors to invest for profit or a share in equity. The British Angel Investors Association acts as an interface connecting both entrepreneurs and angel investors.
- Start up entrepreneurs can approach venture capitalists if there is a requirement of raising funds as larger investments. They can make larger investments for a return in higher profits or equity.
- Start up entrepreneurs can approach government or finance institutions of the community for grants and support.
Basics Of The Legal Structure For Start Up Entrepreneurs
Talking to a solicitor could help deciding the legal structure for the company. The Start up entrepreneurs can decide amongst:
- Start up entrepreneurs can opt for ‘Proprietary concern’ where the entrepreneur assumes responsibility for the entire business.
- Start up entrepreneurs can decide for ‘Partnership’ if there is mutual trust and dependency amongst the partners.
- Start up entrepreneurs can choose ‘Limited Liability Partnership’ where there is a flexible partnership with limited liability.
- Start up entrepreneurs can opt for ‘Limited Liability Company’ restricts personal financial risk as many additional records have to be maintained as a legal regulation.
- Start up entrepreneurs can become a ‘Franchisee’ where the entrepreneur receives the support of an established business and its networks for a fee.
- Start up entrepreneurs can become social entrepreneurs and start a ‘Social Enterprise’ when the individual trades to achieve a social purpose.
Time management for start up entrepreneurs
Time and money are two aspects that all start up entrepreneurs must control for a productive working environment. Otherwise, it may turn out to be exhausting. Start up entrepreneurs must learn to delegate. Make it a point to explain the objectives and communicate clearly with your staff and clients. Start up entrepreneurs:
- Must focus on priorities
- Establish realistic goals for a stipulated time-frame
- Assess the tasks, allocate based on priorities and set realistic deadlines
- Establish good filing systems and procedures for dealing with common events that are time consuming
- Monitor performances regularly to maintain efficiency
- Must analyse activities in relation to time as a way of improving time management
Common Mistakes To Avoid By Start Up Entrepreneurs
Many businesses wind up in the first 3 years. Start up entrepreneurs can avoid these common mistakes succeed in their business:
- Inadequate market research
- Not sharing the business idea and therefore missing out on valuable objective feedback
- Not identifying the needs of the customers in detail
- Weak financial planning
- Insufficient working capital
- Wrong forecast about market size and targets
- Diversifying in a vulnerable stage
- Underestimating the competition
- Improper supplier contracts
- Unsatisfactory credit arrangements
- Heavy investment on fixed assets
- Poor inventory management
- Misfits in employment