By Mary Walton
A startup is a relatively new company that is still in a phase of developing. Generally, startups are small and are financed by one or more people that are also working in a startup company. Often, these types of companies offer something new on the market. The startups are trying to get out there and reach a certain level of brand awareness.
Being in the startup phase can be very exciting for the company and everybody involved in it. Feeling the magic of creating something new and overcoming all the problems that you might encounter along the way is what make it worth. However, leading a startup has its challenges as well. It can be a very frustrating and stressful time, and some days it might feel like you’re not moving from a dead spot. That is why doing your research on things that you need to know before you jump into the startup arena can be of great importance for the success of your company.
1. You will not get money easily
When it comes to startups, people tend to not be so keen on giving their money. That’s the problem with the investors. When it comes to banks and other types of financial institutions, they are too often very reluctant when it comes to giving out loans to startups. The fact that there are not many types of business grants out there and that very few of them are open for startups means that you might not get the financial support for your startup very easily.
That is why you should consider an incubator program where you will have access to money so you can test your idea for a startup. However, these types of programs will require the startups to give up a part of the equity. Another possible option is government funding programs that might be the safest path to make your startup succeed.
2. Don’t be afraid to be picky
It’s okay to say no to some investment opportunities if you feel like the conditions that they’re offering you are not fair to your startup idea. Expect the investors to negotiate the terms with you very passionately, but keep in mind your expectations for your business. Make sure that you do much research and you benchmark your startup idea against global averages to be able to get a fair offer from the investors. Everything may look okay with the offer and the obligations, and then when the negotiations happen you realize that the investors have an idea about your startup that is a lot less worth than yours. In cases like these, don’t be afraid to say no, and to do it over and over again until you find something that is fair. Sometimes, even combining multiple funding sources can be the right decision.
3. Don’t try to be a superhuman
When starting a business, you’re most likely to be in charge of many things that you might not be an expert on. Trying to save up money and playing all the different roles in your startup can both be exhausting and impact the success of the startup. Instead, bring in staff that will be your support like accountants, receptionist, social media managers, and any other types of specialists needed for your particular startup. This way, you can focus on the essential parts of developing your business, and keep your mental health intact.
4. Don’t be afraid of adapting to changes
Even though you might have a great idea that you want to hold on to, sometimes the circumstances can dictate another thing. Being open to adapting to changes can be the crucial thing in the success or failure of your startup. If you are stubborn and you are sticking to your idea, the chances that the business will fail are increasing. Know how to detox the weak elements of your thoughts. The idea on its own is not enough, how you develop it and market it can make a whole difference in whether you succeed.
5. Set it up right
If you’re doing it, do it the right way. Make sure you set it up legally, so the startup is registered with all the necessary documentation. Re-check that your business is okay with all the regulations and taxes from the government. Get the proper insurance from the start since cutting on costs at the beginning can cost you much more if something unpredicted happens in the startup later. Also, make sure that you start networking as soon as you can because business connections are what makes a huge difference in how successful your business will be.
Mary Walton is a professional editor, content strategist and a part of the NCSM team. Apart from writing, Mary is passionate about hiking and gaming. Feel free to contact her via Facebook.