First Steps to Creating Your Startup Company

Starting a new company can be daunting at first and without experience and/or special knowledge, it can be very short lived.  There are hundreds of books to help you with a start-up and for the most part, they provide guidelines to what you can do.   But, before you buy a book or jump into your business head first, here are some suggestions to look at.

For starters, what is your business going to sell?   Is it a product or service?    If you have an idea, then do research on what is out there already.   If you are selling a widget and there already someone selling a similar widget, then you can start doing some basic analysis on the market, the market cap and various cash flow models.

If you see a potential to making money selling your widget in your chosen market, then how is your widget different?   What will differentiate your business (and widget) from the others?   Will it be lower cost, higher quality, or something else?    Be sure you perform the standard SWOT assessment (Strengths, Weaknesses,  Opportunities, and Threats).

An important element to any good business is more than the idea and the market potential – it is the mindset that you must have.   In thick and thin, you must start with a positive attitude and be ready for failure and rejection.  If you can’t take that, then you make not be able to handle your own business.   Determination and belief in your business model is key.
Of course, having money to start your business is also important and for some, this can be the end.   To help with your business start up, you can look to multiple sources like Angle investors.    But they will want to see your business plan and understand how you will be successful before they will give you a dime.   And if you can’t convince one, then try another, until you do.  If that doesn’t work, then use the feedback you received and make changes to your plan.

Another key is the structure of your start-up.   If you take on partners, then you definitely need to be clear on the roles and responsibilities, but be certain you will wear many different hats.  It helps to have this discussion and alignment up front, before you start building anything.   Keep the definitions flexible but be clear on the goals.     Plan on disagreements between you and the partners, but if you have a process for resolving your differences, you can minimize thrashing.   A business plan helps define the roles and structure, but acts as a guideline for the team.   To help, it is important to create an operating agreement.  In the operating agreement, you should define much of the company structure and the legal elements required to run the business.    This document should be done by a legal expert who can help you for your specific states requirements.

There is of course more to starting up a business, but for now, these elements are important:  Having an idea that can sell products or services;  Knowing the risk and market opportunities;  Having the right mental mindset;  Getting access to capital/money;  Solid and flexible business plan;  and an Operating agreement.