Posts Tagged ‘Startup’


5 Strategies to Bootstrapping Your Business

1-28 Funding Options SmallAs you prepare to become your own boss, you need to get your finances in order. You’ll need enough money to cover 6-12 months of business and personal finances before you even launch your business. That being said, you have a few options to consider in terms of where that money comes from.

1. Savings

If you’re lucky enough to have a well-padded savings account, kudos to you. This should be your first option for funding your business. Note: don’t jeopardize your own future by taking the money out. If you have a savings account to cover “rainy day” home repairs, the last thing you want to do is take that money out, and then find you need a new roof!

Consider leaving your money in your savings or money market account, and just taking what you need. That way, your money continues to earn interest.

Benefits: Using your savings account keeps you from having to take out a business loan, which many entrepreneurs are reticent to do. If you have less than stellar credit, you can purchase a Certificate of Deposit and use it as collateral for a loan while earning interest.

2. Bank Loan

The Small Business Association (SBA) is set up to help businesses get the money they need to start a business. There are banks that cater to small businesses just like yours that can help you find a great rate. Start with your own bank, or look for one that does small business lending.  Look for alternative lenders as well, such as Women’s Business Loans. Note: banks don’t lend to startups, so you’ll need to be in business two years prior to applying for a traditional bank loan.

Benefits: The SBA provides a guarantee for business loans, which means applicants with challenged credit score still have an opportunity to get funding.

3. Your Retirement Fund

You can borrow against your 401(k) to start a business. With this option, you essentially use your own money to fund your company, then pay yourself back. Just make sure you pay it back! Sometimes there can be penalties for borrowing funds, so you want to make sure you are aware of them before you take this option.

Benefits: 401(k) financing actually has lower risk than an SBA loan. If things go badly, you still have to pay for the loss, but the 401(k) provides before-tax money, reducing the effective cost. Plus, there are no credit implications and your house is not on the line as collateral.

4. Home Equity Line of Credit

If you own your home, borrow no more than 80% of your home’s value through a home equity line of credit to avoid having to purchase private mortgage insurance.  You’ll increase your chances of getting approved for one if you have great credit and good payment history. Make sure to pay attention to what current interest rates are before deciding on this strategy. And remember: you’re putting your house on the line, so if your business fails, you risk losing it if you can’t pay the loan.

Benefits: Funds are easy to access once you’ve been approved. The interest is tax-deductible, since it’s mortgage interest.

5. Friends and Family

Having a friend or family member who’s willing to invest in your business idea is a real boon. Some may want to be involved in the business in exchange for the investment, while others may hand you a check and say “pay me whenever.” Either way, make sure you’re clear on payment terms (and offer interest) and how willing you are to have someone involved in helping you make the business decisions.

Benefits: If you have a family member who can afford to loose the money they invest in your business, this means they could be more patient with letting you build your business.


Mondays with Mike: What You Can Learn From Hyper-Startups

1-12 business plan smallThere are time-tested procedures for starting a business – from writing elaborate business plans to generating sales projections.  While we can learn a lot from following traditional paths, there’s a host of new entrepreneurs who start their businesses in a flash – moving from idea to implementation in a matter of hours.  These hyper-startups are volatile, flexible, and sometimes unstable, but there’s a lot we can learn from them.

  1. Reach out to customers right away.  While traditional models would have you create a prototype and run alpha and beta testing with a sample of potential customers, hyper-startups rope their customers in right away.  Using crowdfunding and crowdsourcing sites, entrepreneurs can solicit startup funds, feedback, and suggestions from end users before a product is even produced.  Bonus – when you do have a product to take to market, you’ve already established a list of potential buyers.  You’re researching and marketing all at the same time!
  2. Let your best customer find you.  Now, I’m not suggesting that you won’t need to do any marketing in order to reach customers, but what is worth pointing out is that by assuming you already know who your customer is, you may be missing out on your best customer.  Keep an open mind in terms of who will be excited about your product, and even about new or unexpected uses for your product or service.  Hyper-startups know to listen to the chatter.  Don’t limit yourself by thinking you know it all.
  3. Be mobile and be ready.  As more and more business is done on iPads, smartphones, and tablets, the speed with which a savvy entrepreneur can move from idea to income has become mindboggling.  Being ready and able to work wherever and whenever inspiration strikes makes you more effective and more efficient.  Integrating social media with your startup right away lets you make changes and share news anytime, anywhere.
  4. Ride the wave – and know when to throw in the towel.  Hyper-startups can flourish in a flash and fail just as rapidly.  Keeping abreast of trends and market shifts is essential if you’re going to make hay while the sun shines.  Not only does staying up on what’s hot keep you profitable, but it can also permit you to shape trends, in addition to reacting to them.  Encourage your customers to stay connected and keep in touch about their experiences and needs.  Not only are your vocal customers key in keeping your offerings current, but they’re also your best marketers, bringing in new fans every day.
  5. Plan for success (and prepare for failure.)  So you’ve got a brilliant idea.  Are you prepared for what you’ll do if it’s a crazy success and you have more business than you can handle?  Make sure you have a plan for how to scale up production and delivery just in case you’re a big hit.  Also, have an exit strategy, a stop-loss point at which you’ll cut your losses and move on if the startup doesn’t flourish.

Hyper-startups are inherently volatile.  They depend on the changeable desires and interests of notoriously fickle consumers who seek out the new and noteworthy.  That doesn’t mean hyper-startups are all bad.  It’s possible to make a lot of money in a very short period of time, provided you’re prepared.  Even if you choose a more traditional route to starting your company, there are elements of these rapid developers you can use to make your efforts more effective, even long-term.


5 Steps to Starting Your First Business

Woman Running Up the StairsIf you’ve been considering starting a business for some time, stop letting your fears and worries keep from making it a reality. Sure, it will require plenty of work and quite a lot of stress initially, but the payoff, both financially and spiritually, will be well worth the journey. Not sure where to begin? Here are the first five steps to starting your first business.

Step 1: Develop Your Viable Business Idea

Before you fall in love with an idea for your business that no one will actually buy into, do a little research to first see what the market is interested in, what other companies you’ll be competing against, and how you can come into a crowded market with something unique.

  • Conduct surveys and focus groups to understand how people perceive your business idea
  • Look at your competitors. What are their strengths? What areas are they leaving wide open for you?
  • Determine your unique selling proposition. Will you be the cheapest? Best quality? Unique in some other way?

Step 2: Take Care of Branding

Now that you know what you will sell, get your branding in place. This is an area I don’t recommend trying to DIY unless you happen to be a phenomenal designer. Work with a graphic designer with experience creating professional logos, as well as one who can develop a website that will attract new customers. Realize, too, that branding goes far beyond just your visual representation, and will include every message you put out to the world.

  • Look at other logos and take notes on what you like (and don’t)
  • Decide what’s critical to include on your website, and what’s extra
  • Provide as much input as possible on the branding process so that your expectations are met

Step 3: Get Your Plans in Place

You wouldn’t step into the forest without a map, so why would you start a business without a plan? You’ll need both a business and a marketing plan, though neither have to be gigantic, in-depth documents. Your documents are designed to guide you and to establish the direction you want to take. Your business plan should be an overview of your company, what you want to sell, and your approach to the business. Your marketing plan should encompass who your customers are, the different channels you’ll use to reach them, and strategies for each.

  • Use your business plan as a guidance for the future, but don’t be afraid to tweak it every few months
  • Determine how much you can afford to spend on marketing before you decide on the channels you’ll use
  • Keep these documents handy where you can review them regularly

Step 4: Test It All Out

If you will be operating as an ecommerce site, ask friends or colleagues to play around on your site to ensure everything works well. Pay special attention to the checkout process, as it needs to be as simple and streamlined as possible. If you’ll be running a brick-and-mortar retail, make sure your staff is well-trained on your point of sale system, and that everything is running smoothly.

  • Click all links on your site to ensure they go where they should
  • Minimize the checkout process to just 1-2 pages
  • Hold a soft launch event in your store to test run how everything will go

Step 5: Just Do It

Waiting around for the perfect moment to open the (real or virtual) doors on your business is futile. Just jump in! There will be mistakes, so note them quickly, learn from them, and make changes for the better. Aim to create a big splash around your grand opening.

  • Notify local press about your grand opening and invite them for a tour
  • Offer special discounts your first days open
  • Amp up your social media efforts with your launch

You’ll never be flawless when you open your business (or later, either!) so consider it a learning process that will continue to help you evolve as a business owner.


5 Tips To Building a Successful Team for Your Small Business

??????????????????????As a solopreneur, you can only do so much. But as your business grows, you’ll need to expand your staff. Finding and hiring the right people will help your company become more successful faster. Here we look at five tips that will not only help you find quality talent but also nurture them so they feel vested in your company and want to help it thrive.

1. Know What You Need

Pinpoint exactly the skillsets you need to fill to round out your team.  Each person should have a slightly different background and experience so that they complement one another. But really drill down into your needs. Do you need to hire someone who has skills in social media? What specific social sites do you need help with? The more you know about your needs, the better fit your hire will be.

Also consider what types of employees you need. Not every addition to your team needs to be a full-time staff member. You can hire part-time, intern, or freelancer if your needs in one area are less than full-time.

2. Look to Your Network

Before you hit the job boards to find your next employees, ask your network for referrals. They’re cheaper to hire, faster to get on board, and have a retention rate of 46% after being at a company a year. Ask your colleagues, friends, employees, family, and business contacts if they know of talent that would be a good fit for your company.

3. Set Up Your Onboarding Process

The more training materials and processes you have set up, the faster a new hire will feel acclimated to your company and start being a productive member of your team. Have general training materials for your company, as well as those specific to the role you’re hiring for.

If you plan to work with a freelancer or agency, give them access to all the documents, login info, and details they need to be successful at helping you.

4. Foster Team Activities

Hiring one person is a small success. Integrating them into your team is another. Make sure your team is apprised throughout the hiring process so they feel vested and connected to this new addition. Encourage communication among team members, and consider setting up a team-building activity, like attending an event together or even having dinner after work.

Even if you as the business owner aren’t involved in the day-to-day with your team, you want to leave them to be able to build and foster their own relationships with one another.

5. Check Back In Often

A month after you’ve hired a new team member, check back to see how she’s doing. Get open feedback from her, and do your best to remove any obstacles she might be experiencing that keep her from being 100% productive.

Once you’ve done this successfully, make it your road map for future additions to your team.


How David Can Win Against Goliath Competition

Many communities argue against big companies like Wal-Mart moving into their areas because they believe that these big corporations will eradicate local mom and pop stores. Granted, big, burly businesses can intimidate their smaller counterparts. But David brought a slingshot and a bag of stones to the battle. Then, he found a hole in Goliath’s armor and brought him down with a single stone. The “David’s” in the small business world are small but limber. By recognizing the holes in large competitors’ armor, you can turn your business into an effective slingshot that earns its own piece of the pie.

Smaller Can Be Better

????????????????????????????By necessity, most large companies require vast amounts of red tape to do anything out of the norm (and often, things within the norm too). They may have more employees, but each one performs a specific task, following the company rules every step of the way. In other words, procedures, overhead and red tape all mark major holes in the big business armor.

Your small business is nimble. It can turn on a dime to respond to unique customer needs. You can shuffle your priority list to place a last-minute rush consulting project at the top of your list. You can even personally drive an emergency widget order after receiving a call to your cell phone from a frantic customer on Sunday. You are in complete control of the level of service that you provide. Your hands are not bound by red tape and that allows you to provide superior service.

Offer Value Over Low Prices

Small businesses can recognize and embrace the difference between low price and value in your customers’ eyes. Behemoth competitors like the big box stores and large banks may offer better prices, but low cost is not the best way to compete, especially for attracting loyal customers who aren’t swayed to switch companies based on the latest and greatest discount.

Customers will pay more for superior service and products. For example, you can provide additional value by offering products made in the US, beautifully packaged products, services with enhanced customer service support and more.  You, as a small business owner, are uniquely able to compete on value.

Own Your Special Niche

Why would anyone want to open a coffee shop that competes with Starbucks, a company that clearly does no wrong anywhere in the world? Not so fast: in 2000, Starbucks closed 61 of the 84 stores they opened in Australia because they failed to compete with the small independent shops! They could not adjust to local market demand.

Starbucks may offer everything related to coffee, but their in-store drinks and atmosphere currently do not match the experience of the smaller shops. Like the Italian model (a country that boasts no Starbuck stores, by the way), the Australian independents offer quality over quantity — a niche that local customers want.

As a small business owner, you have the luxury of getting to know what your customers really want. Whether you provide green products or services, custom-fit the clothes sold in your store or even drive customers home on a rainy day, you can craft a differentiated selling point. Make sure that potential customers know the qualities that make your business unique and that existing customers love those points of differentiation so that they can spread the word.

Form Alliances with Other Small Businesses

Goliath competitors may have the resources to offer a full range of goods or services that you find hard to match, but you don’t have to go it alone. Networking is a powerful tool that can address the convenient, cost-effective solutions that busy customers need.

Your print shop may offer high-quality, reasonably-priced services, but perhaps it does not sport the excess real estate that allows big bruiser shops to warehouse customer brochures — often for a hefty price. But you can negotiate storage discounts with a local facility so that you can handle your customer’s printing and storage needs at a lower combined price than the competition offers.

Alliances definitely help you give customers the full services that they need. But they can also expand your customer base through referrals from your small business network. One call to your local Chamber of Commerce is a great way to set out on the road to valuable alliances.

There’s Room for Everyone

As a small business owner, you don’t need to fear major competitors. There’s plenty of room in the marketplace to provide business opportunities for businesses of all sizes. By identifying the holes in their armor and taking advantage of your unique strengths, you can carve out your own business success, even if Goliath & Associates is right across the street.


Take this Test before Quitting Your Day Job

Unlike popular business myths, not everyone should start their own company. In fact, it is not the path to happiness and wealth for most people. Every month, over a half million people will quit their day jobs to start a company. Many people have that big dream of betting it all to take a huge risk. Others have a business on the side or as Pamela Slim says, a "side hustle" going while they work a full time job. Unfortunately, most of these people that make the jump to quit their day job are making one of the biggest mistakes of their lives.

Please take this test before quitting. Answer yes or no to each question below:

  1. Do you have paying customers for your product or service? (This does not include relatives!) 
  2. Have you placed a strict limit on the amount of money you will invest? This means is there someone else that has to approve more funds besides you?
  3. Can your family survive if you lose all the money that you are about to invest in your business?
  4. Does your spouse have a job? (Living with your parents counts.)
  5. Is your spouse “enthusiastic” about your move to quit your job and start a company?
  6. Do you have other smart people and mentors that you will listen to even if you think they are wrong?
  7. Have you started a business before?
  8. Do you have good alternative for health care insurance that you currently get through your job?
  9. Is this really the very best timing for quitting your job (or starting a business)?
  10. Can you afford to not make any money from your business for the next six to twelve months?

Scoring the test: Give one point for every “yes” answer and zero points for every “no” answer.

Results: Unless you scored seven points, don't quit your day job yet. There are still too many risk factors for there to be high odds of success.

If I could be happy working for another person I would. If you are like me and can't, pass this test and welcome to world of entrepreneurship. 

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Everything That’s Wrong With Your Company’s Plan (and How to Fix It)

Stocksy_txp9b06d560GD8000_Small_276711Wondering why your business revenue is going in the wrong direction? It all goes back to that foundation you first created for your company — or sometimes didn’t create — and how solid it was front the start. Everything since then should be built on top of that foundation, that plan. Without a strong and clear strategic plan, your business may flounder, and you may make a lot of costly mistakes along the way.

The following are some of the most common problems I’ve seen business owners have with regards to their business plan.

1. It’s Nonexistent

Maybe you never slowed down enough to actually write a business plan for the strategic growth of your company in its early days.  Perhaps that’s because you didn’t think you needed one, were overwhelmed at the idea of writing one, or didn’t know where to begin.

How to Fix It: Better late than never. Start today with a fresh business plan or strategic plan on where your company is and where you want to take it. Start with free software such as www.enloop.com

2. It’s Ginormous (and Therefore Useless)

Back in business school, you were taught that business plans had to be thick tomes, 40 pages plus. They needed to be all-inclusive and leave no stone unturned. Fortunately, that rarely applies to small businesses (unless perhaps you are seeking funding from investors), and what you’ve got is overkill. It’s so overwhelming, you never actually take it out to review it. So what’s the point of having it if you don’t use it?

How to Fix It: Try a simpler plan. You may be the only person who ever reads your strategic plan, and that’s okay. But you want it to be readable and comprehensible, and that starts with simplicity. Stick to the basics, and don’t strive for length. Just get to the point.

3. You Never Look at It

Maybe you developed a fantastic business plan…5 years ago. Likely a few things have changed since then. A plan should be a living, working document that you regularly review (try for 2-4 times a year) and modify as needed.

How to Fix It: Blow the dust off that thing and take a look at what you’ve got. Probably the structure can stay the same, but if you’ve pivoted in your product offerings or otherwise changed company goals, those need to be reflected in the business plan.

4. It’s Not Actionable

Maybe you stuffed your plan with $10 words and filled it with fluff. You read it and don’t have a clue about what to do next.

How to Fix It: Amend that plan with action items. If you established a goal of becoming a $1 million company, set up steps for how you can make that a reality. These need to be achievable and measurable steps so that the next time you review your strategic plan you can actually see how far (or not) you’ve come toward achieving those goals.

Having a manageable and updated business plan or strategic plan is what keeps your business on track toward achieving those goals you’ve set for yourself. So keep it simple, keep it updated, and keep it nearby so you can refer to it regularly.


How You Can Grow Your Small Business to 7 Figures

Stocksy_txp1c8dcf91CD8000_Small_201077So many entrepreneurs I meet think too small. They’re concerned about paying today’s bills, and give little thought to where they’d like to take their business down the road. That’s an obstacle to success, but one that can be overcome with a little planning and strategy. But the most important thing to making more money is to believe that you can. So let’s get started! It’s time to stop struggling and start thriving in your business.

First, Visualize What You Want to Achieve?

Don’t be afraid to unleash your imagination here. Think big! Would you like to run a $5 million company? Sell it in five years and then retire and travel the world? You can’t hope to grow to any level of success if you don’t first establish what your goals are.

Write these goals down and develop a vision board. No matter how pie-in-the-sky they seem at first, if you think it, it can happen. It’s not your job to judge your desires, just to record them. Seeing these goals on paper or a poster will help you get the right mindset to start believing in those goals.

Next, Figure Out How to Get There

You wouldn’t leave for a major road trip without a map. It’s the same as a business owner. You need a plan for how you’ll get to the destination (those goals you set). It may be overwhelming right now to consider becoming a $5 million company, but if you break that goal down into smaller ones, you’ll actually be able to achieve them.

Maybe the first step is to hire a salesperson or expand the area you service. These are small and simple tasks. Continue your list of action items that will help you reach your goal, and assign timeframes to them. You could even list tasks to complete each quarter to lead you to your goal.

Find One Thing You Do Really Well

This might be a superior product. Or your insanely fast delivery time. Whatever that characteristic that makes you different (and better) than the competition, own it. And use it in your marketing material. You want people to know what makes your company unique from the second they discover you.

Hire the Right People

Few solopreneurs are able to reach that 7-figure goal without a little help. And there’s no shame in hiring people who are smarter than you! Find professionals who can complement your skill set with other qualities, and hire help to fill in the gaps with those tasks you simply don’t have the bandwidth to do yourself.

Another note on hiring: it’s important that you create a company culture that makes all your staff — whether they’re full-time or freelance — feel like part of something bigger than themselves. They’re going to be key in helping you hit those 7-figures, so make sure your company is inviting and that they want to work hard for you for years to come.

Refine Your Sales Process

The smoother your sales process is — and any other process in your company, for that matter — the more sales you can make. Automate what you can, from letting people easily make purchases online or sending an email after a purchase, and put personal attention where needed. This is where having sales staff can make a huge difference. You want every single customer to feel like he has the support and access he needs should he have questions or want help.

Lather, Rinse, Repeat

Success doesn’t happen when you keep doing the same thing over and over. It happens when you pay attention to what’s working and do more of it, and cull what’s not working. Be constantly diligent to ensure that you’re firing on all cylinders and moving closer to that 7-figure goal.


4 Tips for Building Your Network Before You Start Your Business

Many would-be entrepreneurs think they’ve got to wait until they start a business to begin building a network of contacts and potential customers. Not so. 90 percent of all small business owners get business from referrals, so the sooner you start — both online and off — the sooner you can forge connections with people that will help you create a sustainable business. You also want to position yourself as a resource so that you can make connections that are meaningful. So don’t wait to start networking! Get started today.

Tip 1: Find Your Industry Peers Locally

?????????????????????????????????Depending on how large a city you live in, there may be networking or support groups for businesses in your industry. If that’s the case, begin your networking efforts there immediately. Join professional organizations or simply attend a few meetings so you can get to know the big (and small) players in the space where you want to do business.

How this will help you: Networking in person helps you assess what types of businesses you’ll be competing against, as well as provide ideas for how you can better serve your target audience. You can look for strategic partnerships. If you plan to only offer Service A, you can find others who offer Services B, C, and D, and by working together, you can reach more customers. And finally, you can find a mentor who can provide you with guidance through your journey into entrepreneurship.

Tip 2: Start Getting Social Online

Social media provides you with the fabulous opportunity to brand yourself and your soon-to-be business. You can create profiles for yourself now and start sharing content that will make you known in your field, before you even have a website for your company. Start by following people that fit the mold for the types of customers you’ll want for your business, and you’ll have an instant audience when you do launch.

How this will help you: Once you start your business, you’ll need an audience for your content. Social media is the ticket to getting more readers for your blog posts — and thereby more customers on your site. And being known as a thought leader will also net you plenty of followers.

Tip 3: Attend Conferences

Another spot rife with networking opportunity is industry conferences or local business events and workshops. Wherever people in your industry — or for that matter, your ideal customers — gather, you want to be there too. Collect business cards. Run your idea by people. Just get your name out there.

How this will help you: Not only do conferences provide great learning opportunities, but you can observe your competition closely. You can also bounce your business idea off of other people to see if it’s even got viability. You may find you need to tweak your strategy before you launch — by getting feedback from others now, you save the time and money of not launching a bad idea.

Tip 4: Join LinkedIn Groups

An even more specific social networking strategy, especially useful if you’re relatively new to an industry or owning a business, is to participate in LinkedIn groups that cater to that niche. Just like with other types of networking, LinkedIn provides access to smart folks who can give you ideas for your business, as well as let you get feedback from them before you start yours.

How this will help you: There’s plenty to learn from others, if you’re open to it. Read the articles and discussions, jump in where appropriate, and take plenty of notes. You’ll need them for your business.

Networking opportunities are abound, if you know where to look. It’s better to start your relationship-building now while you’ve got the time, because once you launch that business, you’re going to be really busy!




 
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