Tips and tricks for startups and new founders
There are a lot of things to consider when you are building a startup. Here are 8 recommendations for new founders and startups.
- Start thinking about problems
What problems does your product or service solve for your customers? Typically, customers will not buy anything from you, if they do not feel that your product or service is helping them or meet a specific need. When you have found out what problem you are solving, you can describe the value that customers get by using your solutions. An effective method to practice thinking this way is to work with Alexander Osterwalder’s Value Proposition Canvas. Get it for free here.
- Figure out how your idea will generate income
Who are your future customers and how well do you know them? No customers, no business – simple as that. Consequently, it is vital to know the behavior, preferences and needs of your target group. And if they are willing to pay a price that enables you to create an economically sustainable business. You need to go and talk to them. You need to get to know them. This is equally important for B2B and B2C, you need to talk to your customers. And finally, remember to gather data in the process that can provide a valid ground for decision making.
- Find out who your competitors are and how you can differentiate from them
Remember that all companies have competitors. Competitors are not necessarily businesses that do exactly the same as you. A competitor is often someone who solves the same problem as you before you enter the market. Perhaps with a different solution, perhaps with a solution similar to yours and can be thought of as an alternative to your product or service.
- Think about how you will sell your solution and who should do it
Remember that sales is a muscle that needs exercise – exactly like anything else you want to be good at. You will need some competencies and interests in sales as a discipline in order to be good at it. And not too many entrepreneurs are into sales. If you as a founder are not fond of selling yourself or your solution, find someone to join the team who is. Many think that marketing will do the trick, but often it is not enough. Following up on marketing campaigns is essential for sales. You can plant a lot of seeds and get a lot of nice leads, but you need to also follow up on them systematically.
- Make sure that you have a support base
As a founder of a startup you are often on shaky ground economically and mentally. It is almost inevitable to feel some sort of pressure, either from yourself, investors or from your network who is always asking about the process. The truth is that many founders are stressed and have a hard time dealing with this pressure. That is why it is vital to have support and understanding from friends and family. Especially, if you are in a relationship and have joint finances with your partner or have kids and need to figure out your work/life balance. Make sure that you have some effective measures or daily routines to deal with stress.
- Manage your finances
Even if it is difficult to predict the future, it is important that you analyze the finances of your startup for the first year or two. It is important for you to know if you have the required capital to finance your processes. How long can you manage without revenue and how much money goes towards scaling your business? Use the knowledge you already have and try to predict how your startup will grow. It is a good idea to calculate on the basis of different scenarios; an optimistic, a realistic and a pessimistic scenario. From each of these scenarios you can calculate a budget. Find templates on www.virksomhedsguiden.dk (in Danish). These will also help you assess the potential risks of starting a company.
- Get a team together
There are some differences between starting a company alone or with a team. If you are on your own it is important to map out your competencies. Find out what you are good at, what you think is the most fun and what skills you lack. When you have made these considerations, find teammates who compliment you. Chemistry is also important, but be careful not to only join forces with people who look like you. The most successful startups consist of a diverse group of people. If the startup is based on your idea, consider making it attractive and motivating for other people to join by giving them a share of the company. Another way of strengthening your team is to hire freelancers for some of the tasks that do not require a full time employee. One way that you can meet people who will strengthen your startup is at the Come Together community.
- Get help
As a new founder you have an exciting and challenging journey ahead of you. However, it is always recommended to seek assistance and sparring. Venture Cup Experts is a convenient way to get free mentoring from an expert in your area. You can also contact your local ‘Erhvervshus’ who typically has free activities for startups in your area, as well as experienced business developers who are ready to help you and your startup. Find the list here.
Tips and tricks were kindly provided by Lars Danscher, Senior Business Developer at Erhvervshus Hovedstaden.