When you’re establishing and growing your startup it’s important to grow it under the right foundation.
This will be somewhat subjective and depend on your end goal/vision. Let’s say for argument’s sake you want to grow to be the next ‘unicorn’ company in your industry.
Firstly, aim high because if you do… and fail, you will most likely fail above the success of others! And let’s face it… If you’re going to fail this is at least a good way to do it.
Without getting ahead of ourselves, it’s important to think of the end goal and work backward.
Whether you plan to keep your company or have a successful exit, if you’re going to be raising funds or pursuing an IPO (listing on the stock exchange) then here are the factors that investors will be considering when looking at your company. So, make sure you consider these when starting/growing your startup.
A company is only as good as the people running it and as the CEO you’re commandeering this start-up, so your passion, knowledge, experience, and resourcefulness are all going to be assessed by VC’s, angels and later institutional investors and retail investors which basically means the general public.
Even if you’re not the most experienced person in your industry, it’s time to start writing a blog, social media post or contributing to a news site where you can demonstrate that you know what you’re talking about.
Add in a button to subscribe so your readers can get your blogs delivered straight to their email – and now you’re growing your database!
There are plenty of ways you can do this for next to no cost.
Medium – Free blog writing platform
Wix – Free version website builder which includes a blog, a low-cost database, and email marketing services.
Past performance in another company can add to point one and helps to show investors that you have a track record of success, but you also need to gain some ‘traction’ and show you can succeed at your new venture too.
Each month, you’ll need to set KPIs (Key Performance Indexes) basically a fancy word for goals that you can measure.
At the end of each month, it’s important to put together a report so that you can track your performance. It’s easier to screenshot the analytics from your website (subscribers, google analytics, page views of your blog platform) and social media (followers, click-through rate, cost of user acquisition from paid marketing, etc).
Showing that you’re progressing (even if it’s only small and slow) proves out your initial concept/idea and starts positioning you as a CEO that can build a following and in turn a company.
Note: Nothing happens overnight so don’t get deflated if this takes months or longer. Stick to your voice, your vision and produce as much content as possible. It’s a numbers game, the more ‘no’s’ you get through the closer you are to a ‘yes’ and in turn success.
Future Vision/Performance (Projections)
Where a company is headed is of course important. VCs typically want to see big visions and ambition that can be supported by the fact to show that your ambition is obtainable.
You can start by putting together an initial financial forecast. The easiest way to start is to work out your expenses and then work out your revenue model (how are you going to make money) and then work out your expected profit.
This is best done on a conservative to ambitious scale. Conservative being a very achievable set of numbers to grow your following, user base and in turn revenue, and ambitious is scaling fast.
Hint: Your monthly reports (as mentioned in point 2) and looking at the growth rate of your competitors will help you here.
Industry, Market Share and Potential for Market Share.
This one kind of explains itself. But, if you’re a little lost, here’s the recap.
The size of the industry is important… how many competitors there are and what market share do they already have (i.e. are they the dominant player in this space). What is your point of difference? Meaning what are you doing differently and why does this matter? What problem are you solving and how much of a pain point is it? How will you become the dominant player?
This leads us into…
Go to Market Strategy
You’ve got your vision, traction, your first financial forecast and you know who you’re competing against and the value you bring to the table. Now it’s time to work out how you’re going to scale/grow your business.
Think about the people who have the problem you’re solving. Are they on Facebook, do they read the news and if so, what news site is the most likely to read?
These are all factors that influence your go to market strategy which is basically your marketing plan.
Social media is great for getting in front of more people and being selective at who you target.
Tip: You can also upload your database list into Facebook and push some of those sponsored posts into their news feed. The more someone sees you, the more likely they are to engage with you.
PR is always a good method of reaching more people and gaining some credibility. You can write a press release (a pitch) to a journalist but it’s best to focus on writing the article for them. It’s also a good idea to have a summary of your article above the actual piece so the reader has an immediate understanding of what you are about to delve into. Bear in mind that journalists write the news, not sales pitches so it’s also best to write your press release from an educational angle that can add value to their readers. Doing this makes it far easier to get your article published, especially if you can tie in current news trends on the topic you’re writing about.
The last step is to write all of the above into a document called a ‘Pitch Deck’ and then use it as a tool to start approaching investors or accelerators.
Understanding your end goal early and then positioning yourself for investment from the start helps to save you time and money while fast-tracking the process of growing your start-up.
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