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hen caught up in an idea, many people want to get the unicorn*. That's why dozens of new companies and projects are founded every day, and their owners wish they could lead them to prosperity. That's why, in this blog post, I'm going to tell you what must an entrepreneur assume when starting a business. Next, we'll look at 10 points that start-ups and entrepreneurs should never forget.
*Unicorn is a common definition for successful start-ups, which bring the founders fame and money (valued at $1+ billion).
Ten things, what an entrepreneur must assume when starting a business
It seems from the side that successful entrepreneurs are lucky. For example, they closed a new niche, had few competitors, good connections, etc. Such thoughts are only the tip of the iceberg. Each of these points, of course, plays into the hands of business people. However, you cannot rely solely on them. There are a number of points what must an entrepreneur assume when starting a business. Them, in one way or another, affect whether the business will fail or withstand.
What must an entrepreneur assume when starting a business?
- An idea is no guarantee of success. You may have a great start-up idea that you want to implement quickly. However, there is no need to rush. You should do two things in the beginning. First, make sure that your customers need your soon-to-be product or service. If demand is low, how will you make a profit and find clients? Second, you should do an objective analysis of the market. It means making a business plan, understanding your target audience, a list of competitors, and assessing your business potential. Besides, you need to calculate the possible income and divide it by 2 or even by 3. The numbers that you may receive in the perfect company growth. Lowering financial expectations is another point, what must an entrepreneur assume when starting a business.
- Without knowledge, it is impossible to achieve your goals. Intuition and connections are a great place to start. However, without core knowledge and fundamental expertise in some areas, there is no way for an entrepreneur to do without it. It is unlikely that in the early stages you will have enough budget to get an excellent staff. Nevertheless, even if you do, you need to manage their work and cross-check many documents. At least until the business is up and running. To achieve this, you have to read books on accounting, become knowledgeable about business theory, get at least minimal sales experience, and learn the basics of marketing to promote the company.
The majority of unicorns is located in the U.S. and China. Interestingly, although there are many successful start-ups in the U.S., the cost of unicorns in the PRC (the People's Republic of China) is often 2х as expensive.
- Even the best concept is meaningless without a solid business process in place. If you are lucky enough to find a promising niche, have some business and accounting skills, you should think through the business process. It is the next essential thing what an entrepreneur must assume when starting a business. You cannot hope to run it by chance and work without a system. Eventually, such an approach will outlive itself, and the list of unfinished tasks will increase. To start, organize your work, the processes for which you are responsible, and create playbooks for each team member. Over time, recommendations and checklists will supplement these playbooks. In the process, you will find and fix bottlenecks.
- You cannot do it without a team. You may be multi-talented, but you can't get to the top without assistants. In the early stages, you can handle part of the tasks on your own. As the project develops, you will have to involve other people in the business. You will be physically unable to be responsible for accounting, sales, promotion, and production. It would be perfect for finding one or two partners who can share the risks and possible profits with you.
- Networking and proper contact management. Some people undervalue how important professional networking is. For a company to grow and the number of clients and employees to skyrocket, it is necessary to be mindful of everyone you know. You're likely to have enough energy and time to organize business cards and put helpful contacts into Google Sheets in the early days. However, the list of beneficial connections will grow each day, and you'll have to use tools to communicate with people properly. The best purpose is to use a personal CRM to store contacts from multiple channels and set reminders. Proper management of connections is what must an entrepreneur assume when starting a business. Otherwise, if you contact people only with asks, the network will weaken, and it will not be of any use.
- You need more time and money than you think. Sometimes it seems like X amount of money is enough to start your company. As time passes, it becomes clear that the cost of the business equals XX money. In this case, the payback period of the project is delayed significantly. According to various sources, many start-ups must pay for themselves from 2 to 10 years. You will have to be patient and prepared to pay double.
- Dive into the work process. Another important rule what must an entrepreneur assume when starting a business is to understand all the functions completely. Before you entrust a task to a team member or delegate some of your responsibilities, understand the company for yourself. You can't always rely on others and expect them to do the task perfectly all at once. It would be best if you first understood how marketing works, how to set up production, prepare a contract, and so on. Only after that can you explain the process to a worker or assistant with no worries about performance.
- Fire ineffective staff members on time. It's sometimes tricky for newcomers to part ways with people, much fewer fire employees. That's a mistake. If a person constantly screws up, you don't have to give them 100, 200, or 300 chances. People have the right to make mistakes and may not know some things, but when errors and inefficiency have become a system, only firing will help.
Most start-ups fail because of marketing and team problems. Financial issues are only the third most common reason why small businesses close.
- You have to take care of the team's motivation. Usually, after 6-12 months, a team member's interest goes down. A person becomes bored with doing the same task for a long time. In such a situation, you need to come up with the proper motivation. For some people, the best approach is a salary raise to achieve the goals set, while others can be offered an extension of competence or skills training.
- Many things you have to go through to succeed. Another thing what must an entrepreneur assume when starting a business is a failure. You can't do everything flawlessly the first time. You will have one loss, then another, and one more. Fails will allow your business to get stronger and get wings.
These were all pro tips, what an entrepreneur must assume when starting a business. I got almost all of them by talking to many entrepreneurs who are in my network. Thanks to the fact that I always use point number 5 from this article, I can get first-hand, helpful information. Do you not know which personal CRM to choose? Download Nection and use all the features this application offers. With its help, you will be able to take care of and nurture your contacts network, selecting the frequency and channel of interaction with your connections individually. I hope your business will thrive thanks to our business tips.