Start-up Key Decisions Contribute toLong-term Success
Start-ups have critical decisions to make, some that can easily be changed and others that can be costly to change later. When starting a business there are many things you may not know to even ask about. When I started F.O.C.U.S. Resources in 2002, there were many things I had to learn. There were many books that talked about business plans and other business processes, but no one talked about the personal. My first book, Out of the Cubicle and Into Business: 114 Questions to Answer Before You Make the Move from a Corporate or University Job to Your Own Business! Doing your homework and making the right decisions for you and the business is crucial.
Start-up C.O.R.E. Elements
The start-up C.O.R.E. elements, the foundation of your business, are:
- Concept – this is your business idea
- Opportunity – this is the target market, niche, customer you plan to serve
- Resources – the skills, funding, and time you need to execute your business concept and serve the customer
- Entity – this is the business model – the how you will do business, make money, and grow your business.
The Business Concept – What Do You Do?
Let’s talk more about these. The business Concept needs to be well-defined, concise and focused on solving a problem or a market need. It is more than the idea of what your business will do. It is your unique way of serving the customer whether that is a product, a technology, a service or a combination of these. The value of your business is found having a clarity and focus in your business concept that will enable you to pursue the right market Opportunity.
The Market Opportunity – What’s Your Problem/Need? Who Do You Serve?
The market Opportunity addresses the who you serve. Who is the customer that is looking for what you do? Who needs a problem solved? The more precisely you can focus your business on a specific customer group (market niche), the faster your business will be able to reach customers. No business has unlimited Resources to market to the world of potential customers. So to be effective, we have to narrow our focus to target a specific group of customers within the population of potential opportunity. This doesn’t mean you will refuse to do business with a customer, not in that group (although you may). You increase the effectiveness of your marketing efforts by being laser-focused on those you can serve best.
Resources – What Skills, Funding, and Other Things Do You Need?
The Resources determine what we can do, how fast we can grow, and how well we can serve our customer base. Resources include skills (people), time and money. It also includes equipment, products, space to do business, and so many other aspects of being in business. You generate business growth by leveraging your resources. Growth is a function of the resources you have, you can generate, and that you can obtain through equity or debt. Your business grows (or doesn’t) based on the effectiveness of your use of the resources you have. When you make a decision on where to use your resources, those decisions must have an Entity-wide perspective based on goals and priorities.
The Business Entity Model – How Will You Make Money?
You should align your Entity needs with specific goals. You achieve those goals by developing the right business model that will enable you to execute that business concept, reach the customer and allocate your limited resources. Working on your business model (and plan) is critical to maximizing your results and your success. It will also focus you on the C.O.R.E. business growth elements related to business : Customer, Operations, Results, and Execution.
Here are a few items to think about when defining your foundational C.OR.E.:
- The personal and the business (things like how much money do you need to start the business and how much do you need to live on until you have a steady income from the business)
- Making a plan to succeed
- Research and benchmark what competitors are doing
- Virtual or brick-and-mortar (location)
- Employer responsibilities: legal, tax, and HR
- Employees or independent contractors
- Tax / Legal structure
- Customer Service/Relationships
- Funding – banking relationships, credit, funds from operations, bootstrapping
- Web presence – websites, domain names, email and cloud services
Articles and Podcasts
- Looking Inside the Gig Economy with GigSalad CEO/Founder Mark Steiner (5/26/2016) - If you are in the music industry or other creative endeavors (e.g., acting, speaking), then you have been living in a “gig economy” for your entire career. Gigs have been around for centuries. However, the gig has come to a new level of visibility in recent years with technology platforms and economic shifts that have challenged businesses and talent not traditionally viewed as gigs to take a new look at how we do business. For those of us who live by the gig (yes, consulting is another type of gig), the biggest challenges are connecting our services, skills, and talents ...
- 10 Elements of Successful Businesses (5/3/2016) - While every business has elements that are unique to it. Every successful business shares common characteristics with other successful businesses. Concept The first element of a successful business is a clear concept of what the business is and does. This concept is more than the idea for a product or service or technology. It includes and understanding that there is a market need and opportunity that seems to have the potential for profit. In the initial stage of defining your business concept you may not know the true market potential, but you have identified through observation, trends, or personal experience ...
- Credit Card Liability – Processing Cards Can Create Liability for Your Business (9/22/2015) - My business does not do a high volume of credit card transactions except at speaking events and trade shows. Yet I chose to make a significant investment this week to protect my firm from liability related to credit card fraud. The investment was not significant from a dollar amount, but from a perspective of managing risk it was essential. If you have a card swipe system (Square, QuickBooks, or terminals) then you will have liability beginning October 1, 2015. The new technology requires inserting the credit card so that the machine can read the microchip embedded in the card, not ...
- Get Out of the Cubicle and Into (Your Own) Business (9/18/2015) - Listen to interview of author Lea Strickland by Tony Trupiano about the book Out of the Cubicle and Into Business. Strategic Leaders A Good Story, A Great Business From Ideas to Business
- Wrong Client (7/31/2014) - The profitability of a company is significantly impacted by its ability to identify both the core client characteristics that make for a good client as well as those that do not fit with your business expertise or require more support from key resources than can be supported by the revenues they generate. For example, last year a company was referred to me and I accepted the engagement. This company was seeking government grant funding to develop technology. It was a one-person operation and the founder did not personally have the technology credentials to do the research and development of the ...
- Women Mean Business – Seek Investors or Be an Investor (7/31/2014) - Women are often overlooked or underappreciated when it comes to participating in investment forums, serving on boards, and leading companies. Women pursuing investment capital and GETTING investment capital are disadvantaged because many forums aren’t “friendly” to our styles, values, and perspectives. There are nationally recognized forums for women-owned and led businesses to participate in, but isn’t it time that we engage the mainstream capital markets? Successful women-owned and led businesses have typically boot-strapped or borrowed to fund their businesses. The capital markets have not been receptive. Much of the cool reception and limited success may be that women haven’t ...
- “Who You Know” and Open Market Competition (7/31/2014) - The world is not objective. It is composed of people, and people are human (at least most of us are). People are at our most basic emotional and relationship-based. We do deploy our logical minds to override and control much of our instinctual behavior and that also makes us human, and adult or mature humans. It is expected of us to act in a way that is not pure emotion that utilizes more than "raw" emotion in deciding the actions we will take or not take in any given situation. Because of our emotions and our ability to connect and ...
- Who Is Running Your Business? (7/31/2014) - In every business there are activities and tasks that the owner, manager, founder, or key executives don’t like to do, don’t know how to do, or just don’t want to do. When those tasks are key elements or effect the key elements of how your business does business, the people handling those tasks essentially begin “running” the business. At first it may not seem to be important that you allow someone within your organization to make the decision as to how customer, vendor, or product information is gathered, maintained, and reported. It is somewhat of a technical and administrative task ...
- Where Was the Board? (7/31/2014) - One of the most critical roles the board of directors plays is the fiduciary role of ensuring that the actions taken by the organization (through its management and the board itself) are in the best interest of the organization and its stakeholders in the long run. This also means that the degree of risk each organization is allowed to assume is ultimately overseen at the board level. Taking a real-world perspective on this question spotlights several dramatic, public examples of situations where it is appropriate to ask the questions: Where was the board? What was their role and responsibility in ...
- Where Is My Cash Flow? (7/31/2014) - What do I do about customers who consistently pay late? Why does it seem that the money flows out faster than it flows in? These are significant questions for every business. Managing the cash flow is critical to a business's viability. The cash flow equation and conversion cycle has several components: Actual cash Inventory Accounts receivable Accounts payable. Managing each of these components and understanding the impact and implications to the "cash available" is important. A recent addition to the complexity of cash management is the impact of the Check 21 Act. It makes each check written a nearly instantaneous ...