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After my 2nd business floundered I figured it was time to take a more rigourous approach to starting business number 3 (billFLO). So, I came up with my 10-Step Approach to starting a business which I’m going to share with you today:
1. Understand your personal goals
If you’re crazy enough to consider starting a business there is something driving you. It’s super-important you understand it. Do not pass go until you do. For me it was (in-order): Learn, Be in Control, Grow my Personal Brand and finally, get rich. Understanding my motivations has informed so many critical decisions and made me happier. In fact, if billFLO ended today, I’d be happy because I’ve already achieved my top two personal goals. (I’d be happier if I acheived #3 and #4 too though!)
2. Get family on board
Dropping everything to start a business is risky and stressful. Entrepreneurs sometimes assume they are taking all that risk, but everyone will be making sacrifices. Get your family on board. If the support system isn’t supporting - you wont be successful. Period.
3. Set Limits/Boundaries
Its very easy to get addicted to this startup business. While your still rational, set some limits to how far you’re willing to go. (Hint: Your family & friends will help you set reasonable boundaries)
4. Understand your market
This is a mistake I’ve made. Its critical to understand two things about your market: size and trend. For example, DVD players are a big market but shrinking. Window Cleaning is a big market but its not growing or declining, Small Business Accounting is large and growing (did I mention billFLO takes the pain out of small business billing!). In most cases it makes sense to pick a market that is big and not declining.
5. Undertand your business type
What is it that your business is bringing to the market? Are you bigger, faster, cheaper? Knowing this will help you understand how competitors will react and how you can out-fox them! Steve Blank has some good material on this topic
6. Define your Company’s Goal?
As you grow you’ll need to energize others around the company goal. The key is to know it before you need it. I’ve heard Grasshopper describe their’s as “Empowering Entrepreneurs to Succeed”. Our goal is simple: Every company in the world using billFLO invoices instead of paper invoices.
7. Work out the Funding
There’s a personal and business component to this one. Plan ahead and make sure you have the cash you need to pay the bills, buy the kids clothes and pay the mortgage for as long as you need. On the biz side, think about what will be needed to get your business paying your billls for you. Do you need to invest in machinery? Or will a couple of PCs and website do it? If its the former, where are you going to get the cash from? Like the company goal, the key is to understand your funding needs before you need the money.
8. Choose a structure
There’s lots of material out there on choosing a company structure. Suffice-it to say, spend some time thinking about an appropriate structure for the future of your business. If you plan to raise VC money then a Corporation is the likely the way to go. Starting a business with your brother to sell Christmas Trees? Maybe a partnership will work. (A lot of this can be changed later but its cheaper if you get it right from the start!)
9. Brand it!
Branding your business is about creating a persona or character for the business. The good news is this takes brain- rather than wallet-power! In the early days there are two components: choosing a name for the biz/product and picking the media to project the brand.
- There is only one thing critical about choosing a name – make sure people can spell and read it!
- Picking the media for sharing your brand is easy. Experiment with the ones you think your customers value and use the most. Try twitter, facebook, blogs, website but measure them all.
10. Set up your systems
It’s getting exciting now. You’re on the last step. It used be that small businesses didn’t bother much with systems and process. However, nowadays there are many inexpensive but very valuable tools that you can start with on day 1. The most important of which is your Income Management system. If you dont know what your income is, how do you know how your business is performing? Depending on your business a lightweight invoicing system like Harvest, Blinksale or Freshbooks combined with billFLO will provide a comprehensive view of your invoice income. If your business is a little more complex you could try a full accounting system like Clarity Accounting, Less Accounting or QuickBooks combined with billFLO to get a holistic view of your business without having to deal with a lot of data entry.
If you try these 10 steps there’s a good chance you’ll be succesful the first time around (rather than the 3rd, like me!). Best of luck.
billFLO Ian
James Dyson, the founder of innovative vacuum maker Dyson like’s to say “We fix the obvious problems others seem to ignore”. Dyson’s quote resonated with me because for the last 18 months we’ve been the only competitor truly trying to fix the obvious problem of e-invoicing for the masses.
