Although business magazines regularly feature innovative and wildly successful startup companies, a startup is any small business that you cultivate from scratch. A startup can be a well-thought-out enterprise with a business plan and a team of investors. Or, it can be a flexible venture or lean startup that adapts and evolves with a developing understanding of market conditions and opportunities.
Starting a Startup
Every startup business begins with an idea. Every empty niche or personal passion can be transformed into an entrepreneurial opportunity. To be successful in your venture, you need to have the skills, knowledge and relationships to deliver your products or services. You also need basic business management skills. A familiarity with finance and operations is helpful. Being a skilled technician such as an auto mechanic or chef doesn't necessarily mean you'll be a talented entrepreneur. But if you're honest with yourself about your strengths and weaknesses, you will be well-positioned to use your personal skill set and assemble a team to run your business.
Calculate business start-up costs by adding up your anticipated expenses for materials, labor, rent, licenses, legal fees, construction build-out and anything else you may have to purchase to get your company up and running. Include your personal living expenses for the initial period when you most likely won't earn enough to pay yourself. Explore sources of financing such as bank loans, credit cards and friends and relatives who believe in you.
Starting up With No Money
Although being underfunded can certainly make it challenging to start a business, you can turn a shortage of cash into an asset. If you don't have much money to spend, you're unlikely to waste funds on unnecessary expenditures such as a fully outfitted plant when you're still uncertain how your core products will be made. Look for opportunities to use free and inexpensive resources, such as the email marketing campaign platform MailChimp – it’s free until you reach a certain level of subscribers. Test ideas on a small scale, then scale up if your prototypes show promise.
Best Locations for Startups
The best place for your startup depends on the type of business you are starting. Innovative companies in the tech sector tend to thrive in areas that attract similar businesses and a strong pool of talent. If you are situated in an area where you have friends and family, you may be better off looking for a business that will be suitable for your area, rather than seeking an area that will be right for your business. Assess your priorities and then research the resources in your area and the strengths of other areas where your business sector thrives.