Whether your startup is in its early stages, making its way to break into the market, or already a successful and profitable business, there are several elements that are necessary in order to lift your start-up to the next level and give it an almost-always needed upgrade. It can also help you prepare yourself for a meeting with an investor, or expose new opportunities for your startup that might have not crossed your mind.
In this article, we’re talking about the foundation of a business.
Unfortunately, many entrepreneurs forget or fail to lay a steady foundation for their business. As a result, they prevent their business from moving forward. So how do you make sure you have a strong foundation, and avoid the risk of missed opportunities? By asking 5 essential questions that can help you break through the barriers. Following are a few questions you need to ask yourself.
1. What makes your product or service unique, and what problem does it solve for your customer?
We live in a competitive world. Hundreds, if not Thousands of products are added to the shelf every day. That's why you should always ask yourself, why will someone buy your product? What problem is it going to solve for them? How is it different from other products or services – what is your competitive advantage?
It can be said that the more unique the product, the more potential it has getting noticed in the eyes of the costumer. The value proposition of your startup must be strong, clear, and appealing; or in other words – so good they can't ignore you.
Accurately defining your value proposition will give you a strong foundation and opportunity to build a strategy for developing a winning and valuable product.
2. What is your product or service's target market?
To succeed and penetrate a market, you must know your customer’s persona. Start wide and narrow it down as you go - Who are they? What is their lifestyle? What do they like and dislike? These traits are the building blocks for a marketing plan that will set your product on the way to the customers hand. Don’t be scared to talk to people, find your future consumers and customers and try to figure out who they are.
Remember: the market you choose must provide a real opportunity of success for your business. Thus, do the calculations and choose a niche that can give you the ROI you want – a Target Market that is realistic but that can also promise success in the future.
A realistic target market will make marketing and selling yourself much simpler (well, as much as possible) – always remember that you can’t market to “everyone”. Focus your branding and out-reaches to specific groups of people that have a need – those with the problem you are trying to solve.
3. Who are your competitors, and why?
And when it comes to a competition – how do you defense yourself and ultimately “win”?
Whenever a new startup wants to enter a market that already has established businesses, It must be prepared to face some difficulties in shape of different competitors and competing solutions.
In order to make sure you bring something new to the table, you must (a) identify your competitors (b) find your product advantages (c) differentiate your marketing plan (d) check your pricing (!) and (e) realize your place in relation to your competitors, and define why customers should use your solution and not others. BONUS: figure out if you can actually act as a complementary solution to some of them!
Knowing your competitors is a big thing – do the above to grow and overcome these obstacles.
4. What is the current stage of your start-up?
Learning and understanding the startup life cycle is essential to answer this question. Because the valuation of your startup partially depends on the stage you are in.
If you’re just starting out and are just at the beginning of your life cycle as a startup company, valuating yourself might be a bit hard.
At Samurai, we tend to look at companies who have already passed the idea stage and are now in their early-stage. It’s important to remember that being early-stage does not mean the startup didn’t establish anything: we invest in early-stage startups that have already shown some proof to their concept and most likely have already found some pilot partners and even paying clients.
It’s also important to know to evaluate your startup’s worth; overestimating your value can lead to the wrong decisions (and perhaps declines of investments), while underestimating yourself may raise some red flags. Always take into consideration the steps and milestones you’ve already achieved, and what the future still holds.
Startup stage and valuation is pretty dynamic, so we advise you to research your operating field and status in order to decide how to describe yourself when going out to look for funds.
5. What plans do you have for the future?
Sounds like a big question, so let's break it down. First, know your current numbers and then set some goals that are Specific, attainable and time-bound. Remember: Baby steps are better than no steps, and setting achievable goals in achiebable time frames is the secret to any success.
Once off on your development journey, try to (1) identify opportunities, and don’t be scared to take them (2) prepare yourself before making any moves by learning the opportunity and estimating your strengths and weaknesses (3) always review your plans and reflect on how you did (4) see the end in mind - know where you're going. See your ideal future, and “reverse engineer” your plans to get there.
Of course there are plenty other things to take into consideration when establishing your startup company. Fear not – whether you’re a serial entrepreneur or just taking your first steps in the startup ecosystem, Samurai is here to join your journey!
As always, we’re looking for early-stage B2B companies with enterprise software solutions to invest in. We’re considering ourselves as strategic investors: once you’re part of the family, we’ll do everything we can in order to help you grow and develop.
Want to join us? Apply now for an investment: https://www.samurai-incubate-israel.asia/investments
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