Many entrepreneurs dream of starting the next "big" thing, just like Jim Shennan did with Starbucks or Mark Zuckerberg did with Facebook. But starting a big business requires much more than simply having the next big idea. Launching a business that becomes truly big requires putting together the right concept, the right people and the right resources, allowing the business to grow from tiny acorn to mighty oak.
Identify a business concept which solves a real problem or need for a large number of people in which you can excel in a unique way against competitors and which can be scaled up from a single operation to a multi-million dollar company, either through adding units (such as franchises) or adding markets (such as selling nationwide or overseas). Only businesses which can successfully "scale up" have the potential to become big, successful companies.
Formally organize and register your business as a C-corporation, S-corporation or Limited Liability Company, each of which provide a legal structure which will allow you to raise large sums of money in the form of stock investment and loan guarantees. Hire an attorney who specializes in establishing large corporate entities to ensure that your company is structured in the most advantageous way possible for your future growth into a truly big business.
Write a business plan that describes the business's core concept, its advantages over current competitors in its field, its distribution model, its measurable goals and time line, leadership, budget and projected earnings through its first three to five years. Also required are sections on the company's marketing strategy, long-term company development strategy and exit options for investors. Consult your banker, accountant or other business professional for advice on making your business plan as viable and "bullet-proof" as possible.
Present your business plan to family, friends, acquaintances and angel investors to raise the starting capital your business plan requires. Your goal should be at least 100 percent funding of your plan's budget. Ideally, raising twice that amount will prevent unexpected expenses or business complications from derailing your plan. You may need to be able to demonstrate proof of your business concept with samples of your product, a demonstration of your software, customers who use your service or other methods in order to raise all the capital you need.
Build a company team that can successfully launch your new business. Hire the best professional staff you can afford whose skills compliment those critical areas which you lack. As this team will be the crucial people upon whom the entire success or failure of the business will rest, you'll want to attract the best possible employees. Many start-up companies offer initial employees shares of stock or other equity participation in order to guarantee their loyalty and performance.
Establish your new business and begin operations to prove that your concept can succeed on a larger scale. During this period, you'll need to secure a moderately-large customer base, fix problems or unexpected issues in your operational systems and adapt your business plan and/or model to prove that the business is ready to grow ("scale up") with multiple locations or outlets.
Present your business model and a revised business plan to reputable venture capitalists (VCs) to secure multi-million dollar growth investments. Be prepared in this initial round of venture capital investment to surrender 20 to 40 percent of your company's equity in exchange for the investment. VCs will be especially interested in the growth potential of your company, as well as a three-to-five- year "exit" horizon, the point at which their investment will be repaid at a large multiple of profit.
Hire an experienced executive management team, including a Chief Executive Officer (CEO) to take over day-to-day operation of the business. Most VC firms will require this, as well as one or more seats on your board of directors, as conditions on their investments. Be prepared to remain involved in the business, but understand that your role as founder will be diminished as the operational control of the business moves toward a professional team focused on exponential growth.
Repeat the cycle of growth, investment and re-investment to ensure that the company reaches critical mass in terms of numbers of units or sales volume to prevent destruction by your competition. Having survived to the point of sustainability, the company will explode in size with a large-scale corporate acquisition or an initial public offering of stock ("going public").
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