How to Start a Business

How to Start a Business

Starting a business is hard and there are a lot of steps to take.

  • Learn about being an entrepreneur
  • Idea stage
    • Proto-Build
  • Business type (e.g. tech, product and services)
    • Learn intricacies of the specific business type
  • Business plan stage (e.g. what, where, when, how)
  • Business formation (e.g. permits, company structure, tax id)

About Being an Entrepreneur

Being an entrepreneur is a hard thing to do. There are so many issues to work through, solutions to discover, space to fight for, etc. To understand more about being an entrepreneur and to lower your apprehensions, look at this excellent article written about how an entrepreneur works.

Becoming an Entrepreneur by Oliver Emberton, founder of Silktide

Some Rules to Follow

  • No excuses
  • Bootstrap the projects
  • Don’t start with a loan from the bank
  • Be innovative
  • Start off with a project you can actually bootstrap
  • Stay focused and beware of scope creep

Decide on yourself and if this is really the road you want to take. Use this worksheet to help you with this.

Before You Start Planning More

There are certain prerequisites you need before planning out your business. Such things as having a name for your business or project and a well developed network and the skills for it.

Pre-Planning Steps

What is your business name?

Business Name – You generally want to name your project early on so you can actually refer to your project easier. – How to Name your Business.

Domain Name – Do you need a domain name as well? (i) If so, this may greatly affect how you need to choose the name. – How to Name a Domain Name

Network and Be Social

Do you have a network of friends and business folks to work with? It is very important to network with people. It helps gain useful connections and of course you can meet some new friends along the way. – Read more here…

Find Mentors, Advisors, and Entrepreneur Pals in Person for FREE

It is incredibly helpful to have mentors and advisers help you. Many can be found for free and our sponsored by corporations, universities, state level, and federal level. – Read more here…

I Have an Idea, How do I Start a Business?

This guide is your how to start a business road map. It will discuss the steps needed along with the methods and resource links to accomplish those steps. A lot of people have an idea for a business or something they would like to make money off of. People can start off in all different parts of the planning stages.

  • M&R = Methods and Resources
  • (i) = Tool tip. Hover over them to see information.

1) Ideas (The Ideas Page)

  1. Thinking of Ideas | Finding Ideas | Idea Farms | Small Business Ideas
  2. Validating Ideas
  3. Protecting Ideas
  4. Utilizing Ideas

2) What business type to choose?

Tech Startup – Electronics, Micro-electronics (i), and other digital products such as software, websites, and phone apps.

Tech Startups PageTech Startups Knowledge Base Category

Product and Service Startup – Product creation such as vehicles, machinery, tools, inventions, or physical services such as mowing lawns and construction work, or a product and service hybrid business such as restaurants, bars, or software development.

Product and Service Startups PageProduct and Service Startups Knowledge Base Category

Web Startup – Websites that do something for their customer. The website is the storefront instead of a brick and mortar location. Examples: Auction websites (i) and Classifieds (i)

Web Startups Page
Web Startups Knowledge Base Category

2b) Why did you choose that business type?

Validate it with an explanation.

3) Business Planning Stage using Lean Startup methodology

All business need certain things. You can use a lean startup approach to figure out the bare bones of your business or take a lot more time and create a detailed business plan that a bank would actually look at.

Lean Startup Business Planning Approach

  1. Problems
  2. Target Audience
    • What is your target audience that you expect use your product or service? – Read more here…
  3. Unique Value Proposition
    • What is unique to your product or service that will make your audience fall in love with what you are offering them? (exceptional customer service, customizable product?)
    • It is NOT a tagline or catchphrase. – Read more here…
  4. Solutions
    • What are the solutions to each of the problems laid out in step 1? Read more here…
  5. Delivery Channels
    • What channels do you plan to use to deliver the solution in a product or service form? (An eCommerce website? A brick and mortar building? Amazon?) – Read more here…
  6. Revenue Streams
    • How do you plan to monetize your startup? (memberships, sell a product, etc.) Read more here…
  7. Cost Structure
    • What are all the costs associated with your startup? (e.g. hosting fees, cost per PayPal transactions, developers, office rental, printer ink, etc.) –  Read more here…
  8. Key Metrics – (Key Performance Indicators aka KPI) – Read more here…
    • What are the ways you measure your business? (e.g. Raw Numbers such as number of customers, Progress such as towards set goals, Change such as a percentage change in sales)
  9. Unfair Advantage
    • What advantages do you have over your competitors? (e.g. Larger production warehouses, lower production costs, agility, etc.) – Read more here…

Business Plan Methods

  • Lean Startup Business Plan
    • This planning section used a lean startup approach. Use can use LeanLaunchLab for a semi-automated process of doing this or write it out on your own and continue onto the next steps listed.
      • Use  LeanLaunchLab for semi automated lean launch canvas creation.
  • Detailed Startup Business Plan
    • To use a more detailed planning setup you can create a business plan that a bank would actually look at.

3b) Fine tuning stage 1

After you do the lean startup phase you can look into the other more complicated factors.

3c) Fine tuning stage 2 (Exceptions Task List)

All business types have exceptions in the To Do Tasks list that needs to be generated. Different business types require different legal implications. Most have different types of production and delivery methods as well.

  • Tech Startup
    • Because tech startups can be either software or hardware related, you will end up utilizing business traits from one or the other. If it is a tangible object, you will utilize hardware startups. If it is a website related project you will use web startups. If it is a software project you will utilize tech startups traits which are a group of their own.
  • Product and Service Startups
    • If the business needs an online presence, web startups will also be utilized.
  • Web Startup
    • Because web startups are software related they are under the umbrella of tech startups as well as web startups.

4) Business Formation

Forming a business requires permits and legal items to be taken care of. If you miss something you can end up being audited by the IRS or being sued and lose all of your property. Then there is the possiblity of doing something illegal without really knowing you are and ending up in prison.

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