You have an idea for a business. It’s always been your dream. You even told yourself “2017 is the year!” It’s July, how’s it going?
If you haven’t started, what’s stopping you?
What if there was a way to start this weekend and increase your chances of success?
There is! And it starts with a device 32,000 times more powerful than the computer used by NASA to put Neil Armstrong on the moon.
All you need is a smartphone and an idea to start a successful business.
Why? When we think about starting a business, our thinking is often stuck in the past:
• I need a business plan.
• I need to find money.
• I don’t have the time.
This way of thinking is out-of-date and potentially detrimental to your business dreams because:
1. Don’t get stuck on the business plan – you can’t predict how the market will react to your business any more than you can predict lottery numbers.
2. Demand for your product is only proven by paying customers – anyone can and will say yes if they don’t have to actually commit. Talk is cheap.
3. Investment at the wrong time can be fatal – prove the business works first and generate income, then introduce investment to scale.
To start a business in today’s economy, it’s best to start small and use the power of the technology you already own to:
• Maximise your time, minimise your risk. Use the free time you have now with your current job to work on your business.
• Test demand. Understand what customers want while building a real customer base.
• Build based on data. Develop the smallest business possible that generates cash and profit, all while bettering your offering based on the data you collect.
This may sound like a tall order for a smartphone, but there’s an app for each of the four steps to starting a business.
Step 1. Define success.
Only you can decide when your business will be successful. What do you want to achieve? Once you understand that, convert that into a monthly income target needed to achieve success.
Apps to use
Use the free numbers app on the iPhone to understand what you need to earn to achieve your goals. Or apps such as Strides app which helps you to record and track your goals.
Apple: Get Apple Numbers
Step 2. Create the test business
This is essentially your business plan. Ask yourself these questions and document the answers:
1. Who are your customers (it’s not everyone!)? What type of person would need your product/service?
2. How are you going to connect with them?
3. What are you going to sell them?
4. What problem does it solve?
5. How much profit (sales minus the costs you incurred making those sales i.e. Raw materials stock etc.) do you generate from each sale?
6. How will you sell the product to them?
7. How will they pay you?
8. What costs will you incur?
9. What key activities do you need to complete?
10. What partnerships and resources do you need to be successful?
When answering these questions, focus on what needs to be true in order for the business to be successful. Depending on your business idea, you might be able to test the whole business or you might have to break it down into smaller tests.
App to use
iThoughts mindmapping app is my favourite app for this but there are many free options you could use. Numbers, notes or word would work equally well.
Step 3. Get out and test
Don’t go and prove yourself right; go and hunt for flaws and prove where you are wrong. There are always flaws, which is why business plans fail on first contact with a customer. Find them, fix them, and move on.
While your first sale will feel like a victory, the true test is understanding why they bought from you.
Ask the five whys
Why 1 ask why they bought from you?
Why 2 ask why was that important?
Why 3 ask what’s the reasoning behind the answer to question 2?
Why 4 clarify the reason for the answer?
Why 5 clarify further.
It may seem like brow beating, but clarity on what makes your customers buy from you is the most valuable asset you have right now. Even more useful is when you can do this with people who nearly bought and find out if you need to change something like. pricing or product specifics.
Apps to use
Facebook is a really good place to start, especially if you already have a sizeable following. Start a page for your business. Keep it simple and focus on getting as much feedback as you can. Facebook is a great way to find and understand customers.
Sage Expenses & Invoices is a super-simple and free way to record income and expenses. Remember, income is the sales you make minus what you spend. You can then add functionality as you grow.
Step 4. Scale it
When you’ve proven what works, scale it up to achieve your targets.
You can now take all the real evidence, your growing customer base and the profit you have generated to create a proposal for a bank or an investor.
Start now. What’s stopping you?
All you need is an idea and a smartphone. The power in your pocket gives you everything you need to set up your business and your office right here, right now.
The only barriers are the ones you create for yourself. We are here to help you smash them down on every step of your journey to business success.
Learn more about creating a virtual business in our latest guide, Building a Virtual Business.
Find an accounting solution that meets your business needs, visit Sage