10 things to consider before starting a business
It's Global Entrepreneurship Week and we're celebrating all things start-ups. If you've not yet made your business dreams a reality, then there are a few things you should think about first. We spoke to Ollie Collard, Virgin StartUp advisor and founder of Enterprise Orchard, to find out the most important things to consider.
1. Support from your nearest and dearest
“Before you go any further with your idea, have a chat with your husband, wife, partner, kids, parents and other close family members and friends,” Ollie recommended. “They’re coming on this journey with you and you need to know that they’re going to support you when things get tough.”
2. De-risk financially
“You need to make some decisions about your finances before you start a business – and that includes your personal financial situation,” Ollie said. “First, reduce any unnecessary financial commitments and work out what is the minimum amount that you can live on. Think about your income, – will you work full time and launch a side hustle? Or do you plan on working part time? Or are you going to go ‘all in’?”
Ollie recommended using Virgin StartUp’s Personal Survival Budget template to work out your finances and coming up with a timeline for how you’re going to transition yourself into the business.
3. Have a plan and a vision
You can’t expect to be successful in business unless you plan and Ollie suggested developing a business plan, business model canvas and cash flow forecast before you get started. Set some stretch goals to keep you focused and motivated.
“Studies have proven that entrepreneurs with a business plan have lower failure rates,” he said. “Planning will also give you more confidence and it will make you consider all aspects of your business – including any ‘what if’ scenarios.”
Develop your vision and know your ‘why'. This will be your north star to guide you.
Download Virgin StartUp’s business plan template now.
4. Get to know your customer
Ollie recommended doing a deep dive into your target customer’s life. Work out what problems they have, what their view on the world is.
“Write down a large list of all their problems and analyse all of your results,” he said. “It’s likely there will be three standout trends, this is where you should focus your business.
“Get specific and drill down on your target customer,” he added. “The more you know about your customers, the more your message will resonate, therefore the less you have to spend on marketing.”
5. Get to know yourself
Getting to know yourself, as well as your customers, is just as important when starting a business. “Your biggest competitor will be yourself,” Ollie said. “Remember that your self worth is not based on the success or failure of your business. Do not let it be all-consuming.”
To get to know yourself a bit better, Ollie suggested taking a personality test such as a Myers Briggs test, or DISC profiling – or you could check out the entrepreneurial personality test on the Enterprise Orchard website.
6. Sell it before you build it
The idea that “if you build it, they will come,” doesn’t work for start-ups. You need to make sure that people actually want what you’re making, Ollie said. “Get sign ups, pre-sales, any form of financial commitment. This is your proof of demand.
“‘Potential sales’ are often worthless – people’s outlook on the future is less tangible and unfortunately skewed. Instead, consider options such as crowdfunding to kickstart your business and build sales.”
7. Find a mentor
Having a mentor with more experience than you can prove invaluable in the start-up world.
“Mentors have been there, done it and got the t-shirt,” Ollie said. “They can help you make better strategic decisions, reach your goals quicker and open doors for you.”
When you take a Virgin StartUp loan, you get a mentor for six months – visit Virgin StartUp to find out more.
8. Develop networks with other founders
“There are loads of other people who are starting businesses right now – and facing the same challenges that you are. Get to know them and it could prove very useful for your business,” Ollie said. “Peer learning can double your profitability.”
Virgin StartUp’s community gives you access to other founders who are on the same journey as you. They also run regular events where you can meet other entrepreneurs.
9. Patience, perseverance and the right mindset
It takes time to build a successful business, you can’t expect to be an overnight success.
“Building a business takes time, bags of grit, and determination,” Ollie said. “Developing the right mindset will be one of your greatest assets. I’d encourage you to learn to get comfortable with the uncomfortable.”
Podcasts are a great resource for gaining insights about how to think like an entrepreneur. The Founded & Grounded podcast interviews a new startup business owner every fortnight.
10. Don’t forget to have fun
Most importantly of all, remember to have some fun.
“Build relationships, not sales,” Ollie said. “Do unexpected things to surprise your customers. At the end of the day, business is all about people.”
For more advice on starting a business, and to apply for a start-up loan, visit Virgin StartUp.