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
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