Starting your business from scratch can be a daunting task, but with the right planning and execution, it can be incredibly rewarding. Here are the steps you need to take.
1. Identify Your Unfair Advantage
The first step in starting a business is identifying your “Unfair Advantage”. Those are the unique talents, skills and life experience that give you an advantage over your competitors. This might be things that you control like your education or social circle. Or it could be things out of your control like where you were born or your IQ.
Ash Ali and Hasan Kubba who wrote the book The Unfair Advantage say this is the number one factor in determining whether a startup will succeed or fail. If you’re a member of our free online community of entrepreneurs I have a PDF that walks you through how to identify your unfair advantage. I highly recommend it, especially if your struggling with this step.
2. Find a Problem You Can Solve
Once you’ve identified where you can have the greatest impact the next step is finding a need you can fill or a problem you can solve. This is a LOT easier when you know what your unfair advantage is. Remember, entrepreneurship is about SERVICE. It’s an exchange of value. Your job is to find something you can do or create that is more valuable to someone else than the money that’s in their bank account.
During this phase ask yourself some questions like:
– How much time can I commit to my business?
– Where can I use my unfair advantage to maximize the value of my talents and skills?
– What is the MVP (minimum viable product) I can create to test my business idea?
– Who else has a similar product and how are they selling it?
3. Develop a Market for Your Product
This is the #1 mistake I see new business owners make. They wait too long to start building a list of potential buyers. If you focus 100% of your time on creating your product you’ll have no one to sell it to once it’s finished. So start thinking about where your ideal customer might be. Are they in a specific part of town? Do they belong to a club or group? Do they work in an specialized industry?
If you find yourself responding with “My product would work for anyone”, that’s great but ‘everyone’ is too broad of a group. If literally anyone could benefit from your product or service then pick one group or industry that you feel has the most to gain by purchasing from you and start with them.
4. Validate Your Idea
Now that you have an MVP and you’ve identified a group that would benefit, it’s time to test. Most entrepreneurs go right for the throat. They try to get that first sale. But this isn’t always the right approach. There’s a chance you might hit a home run your first time at bat but it’s not likely. Chances are you’ll need to do some adjustments to the product or your service offering. So I suggest you give your product away for free in the beginning in exchange for feedback.
By taking time to validate your idea at the beginning you’ll learn what customers like and dislike. You’ll get valuable insights into what you might add to make the product truly irresistible. You may even get an idea of what someone might pay for your idea. The important thing here is to take your time and learn from people who will be using your product or service.
5. Make Your First Sale
You now have a solid product that’s been tested and improved. It’s as good as you can make it (for now). It’s time to make that first sale.
Start by asking for referrals from the people who tested your product for free. There’s a good chance they may buy from you themselves or they may know someone who would.
Let your friends and family know that your product or service is ready for prime time and ask them if they know anyone that might be interested. Low Pressure is the name of the game here. We don’t want to harass our friends and family, expecting them to act like unpaid sales reps. But if you don’t talk about your business no one else will either.
Finally head back to the network you built while creating your product. Present your offer and see who bites. If you’ve done everything else correctly I think you’ll find making that first sale is easier than you imagined.
P.S. If you have a question about starting or growing your business please email me at firstname.lastname@example.org and I’d be happy to answer it in an upcoming blog post.