A guide for Early-stage entrepreneurs on launching a profitable start up!
“9 out of 10 startups fail (source: Startup Genome - the 2019 report claims 11 out of 12 fails).”
Nobody ever steps into the start-up world to face failure, all the hard work and sincerity that is put in business by any entrepreneur cannot be overlooked when the business has to pack up and shut down its business. There are various reasons why this happens but what do seasoned entrepreneurs who have a track record for launching very successful companies that many failed start-ups aren’t aware of?
Here’s our 5-step process to launching a profitable start-up
1. The Focus
The focus of your company is like a foundation brick for building a successful business, whatever you built on top of it will depend upon what support the underneath layer provides. One needs to build a solid structure to build a strong start-up. This is possible only if you are able to strike the right balance between your abilities (skills), interests (passion) and what you can get paid to do (money).
2. The Problem
Before launching your start-up, you have to determine the specific problem that is suffered by customers and what your company is trying to do to solve it. To test if your “Start-up idea” is monetizable, you need to:
- Find a sample of customers
- Survey them in person or online (with google forms)
- Evaluate the results
That'll help you to get an insight if your product is viable, the scope of improvement and customer expectations as well. Make sure the response you receive is honest and unbiased.
3. The Market
Now that you’ve identified the focus of your company and the problem that it solves its important to find a market for your solution. You need to properly calculate the size of your specific market and dig deep to find the exact preferences and buying habits of your target population You also need to make sure that your product delivers what it promises to do.
4. The Solution
Having completed the second & third stages, now you need to possess facts and ideas about how your product should look or function. It’s essential that you avoid wasting time, energy and money “perfecting the product” by adding non-essential features. At the beginning stage, you need to focus on the bottom line and save money. You can slowly refine your product while testing demand for your product.
5. The Revenue
Do you have a sound business plan? Is it scalable?
With your focus, problem and product figured out along with your assurances that a market exists for your solution. Now, you need to calculate your next step that is whether or not your business model has the capacity of selling your product, make profits and increasing in scale. You need to make sure that your business model has the potential to grow your company over time.
About Devansh Lakhani
Director of Lakhani Financial Services, and a Chartered Accountant, he helps start-ups raise funds from his network of investors. He guides and advises start-ups to scale up by providing efficient sales, marketing, team building, and business management strategies. He has executed fundraising by block deals on the stock exchange and conducted IPOs and right issues on the SME platform to the tune of over Rs. 50 Crore. He is currently working with start-ups from various sectors to help them channelize their business models and investments.