I was recently asked by a group of entrepreneurs at a talk I was giving what my top 5 tips were. I thought I would share on my blog incase anyone else was interested:
1. Minimise your risk
Starting businesses is a risky game and there is a very high failure rate. Annually over 660,000 businesses are launched and within 3 years 60% will fail. Every founder believes their business will succeed and it's important for our economy we try. It's important we fight in the face of adversity and launch businesses for the sake of job creation, new products/services and the economy. My advice to newbies is to test the market with as little capital as possible, try not to bet the house on your new venture. Dont give up the day job until absolutely necessary, late nights and weekends are when founders come to life and work on their businesses!
2. Use the tools available
There are many great tools available to help you launch your business with little capital. Research them, many have free trials so you can learn and test. At the present time, Shopify, Bigcommerce and other SAAS offerings let you setup a website very quickly. Accounting packages such as Xero save you on accounting system upfront costs. You can use services such as Fiverr or Upwork and build a virtual team. I also find apps such as Evernote useful for keeping notes.
3. Look for the right people to work with
Although one man bands can do amazing things, it can be a lot easier with a team. Whether they are co founders or people in your network you can work together with. Over time I have found working with the right people delivers profits quicker and makes the experience more fun. Having a team let's you split the workloads and solve problems quicker. As an investor I prefer to work with teams, as there is less risk and more likelihood of success.
4. Keep up your energy levels
Starting a business and growing it is hard work. There is no denying the hours of hard graft you selflessly have to put in. It's important to keep yourself in good health, enjoy some time out. Doing this let's you take a breath of fresh air and solve problems you sometimes struggle with when you're working so hard.
5. Embrace failure
When starting a business, be prepared to pivot, if your business is not getting traction it's worth considering another idea or changing direction, perhaps delving deeper into the part of the business which is working. I've met many founders who have been pig headed that their business should succeed. Even after having burnt through hundreds of thousands of pounds of investment they believe more money on marketing will fix their business. Sometimes the product is wrong or the market has shifted. As an investor we take a top down view of the business and evaluate whether there are parts which work or could work with a fix. But if it's clear it is not working or is not fixable, be ready to embrace failure, pivot or restart and move on.
If you need any help or advice, feel free to contact me via the contact form. Thanks for reading.
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