THE ONE THING YOU MUST DO FOR A BUSINESS BEFORE YOU START ANOTHER
Are you an entrepreneur with many innovative ideas? Do you have an unbridled passion to birth your ideas into yet another business venture? Are you an optimistic risk taker who is constantly in pursuit of success? Do you successfully birth one idea into a functioning business before jumping on executing another idea or you never quite get to establishing a working enterprise?
Maybe you’d like to be a serial entrepreneur and you look up to the likes of Elon Musk, Russell Simmons, Mark Cuban, Jayz and 50 cent who have somehow mastered the art of risk taking and strategic innovation, embarking on projects that once were thought to be unwise but that ultimately turned out to be successful.
To be a successful serial entrepreneur there are factors you must consider before starting a business and things you must do to build a successful business .
They are as follows;
Consider the viability of your idea as a business venture:
Taking time to validate the viability of your business idea is a critical step in being a serial entrepreneur. You must consider if your idea is one that creates value that people want to pay for or if it's merely a castle in the air.
From the start, you must itemize the values you will be providing through your business idea and how these values can provide solutions to an existing problem, or cater for an existing need. You must also have a target market that you are certain will be willing to purchase the value you will be providing at a cost.
If you’re unsure as to whether your idea can be a business that generates profit , see our article 5 Issues to Deal with to Make Your Idea a Profitable Business.
Write a business plan:
Your business plan is to you what a building plan is to a builder. In starting a business you should have a plan not just on a paper but also a way you intend to handle the market. A business plan gives you the opportunity to measure yourself as time goes on. Without a business plan your business may not go beyond the first generation and this is because there’s nothing guiding the business, no plans and no vision. Business plan is everything to a business owner, it helps guide your activities.
To understand the significance of a business plan in building a successful business model see our article on MYTHS OF BUSINESS PLAN.
Choose a legal structure and register your business:
While business registration may not be mandatory in some cases, it is essential. Without the registration of your business, it will lack a corporate personality and the consequence of this is that you will be unable to exercise the powers and functions of an incorporated company and this may in turn retard the growth of the business as some potential investors may shy away from investing in the business.
A business structure shows professionalism on your part as a business owner, it gives you access to financing sources, it allows you to protect the intellectual property of your business, it gives you an umbrella to get the necessary licences and permits you may need in your business operations, it helps you protect your finances and assets and also helps you grow your business smoothly. The advantages mentioned are non exhaustive. You may be wondering what legal structure suits your business idea, to understand the intricacies of the structure options you can explore see our article on Important things to know about registration of business in Nigeria.
Know your competition and the marketplace:
Understanding your existing and potential competitors is very key. Study the market, look at existing competition and also at potential competitors that may target the same business problem your business idea seeks to address. Understanding the competitors that exist and how they are attacking the same or a similar business problem is essential to determine the viability of your idea. One technique is to make a chart that lays out the top five or ten values or features of a competitor and scores each on a scale of 1 to 10. Then score yourself. This will give you a basic understanding of competitors in their strengths and weaknesses.
Have a feasible Finance plan/structure:
Finance is key in building a successful business. How do you intend to finance your business idea? The options you may consider are as follows;
iii. Angel investment
iv. Venture capital (VCs): Venture capitals are professionally managed funds who invest in companies that have huge potential.
v. Business incubators and Accelerators.
To understand the financing options listed above you can see our article on Demystifying Startup Funding for Entrepreneur. Our article on How to Fund your Business is also recommended. You can also see our article on DEBT CAPITAL VS EQUITY CAPITAL to understand the implications of choosing any of the finance options listed above.
Define Your relationships through contracts:
To build a successful business model, you will have to work with people directly as employees or indirectly as independent contractors/outsourced agents. This is because a business venture is all about division of labour. You must ensure to treat your business as a business and not based on sentiments or personal relationships. It is very important that anybody that is on your team is deliberately on your team and they have their obligations and duties spelt out in a written contract. They have a major role to play in the development of the business and so you must be deliberate about the people you bring on board to ensure that they share in the vision of your business and can add value to your business. Defining your relationships through contracts will also help to guide parties in the event that there is a dispute in the course of carrying on the business. For insights on how a written contract can help in resolving such disputes, you can see our articles on MANAGING EMPLOYMENT DISPUTES (EMPLOYEES' PERSPECTIVE) and MANAGING EMPLOYMENT DISPUTES (EMPLOYER'S PERSPECTIVE).
Protect your intellectual property:
Where your intellectual property is used without your permission your business can suffer for it. When you have a great idea for a product or service, there will always be people who will want to copy your success and sell your ideas as their own. Depending on the category under which your intellectual property falls under, you can use patents, trademarks or copyrights to protect your intellectual property. These can be used to prevent competitors or anyone else from using your ideas for their own profit without your consent.
To understand why taking ownership of your intellectual property is important, see our article on LEGAL MISTAKES TO AVOID AS AN ENTREPRENEUR.
Mastering your legal compliances:
To build a successful business model, you must not shy away from legal compliances as they may become loopholes that will work against your business’ growth and continuity.
You must learn to navigate the business terrain of the country where your business operates and observe the general and industry specific regulatory compliances set out. To understand the importance of regulatory compliances set out for businesses in Nigeria, see our article on TOP REGULATORY COMPLIANCE MOST BUSINESS OWNERS NEGLECT AND WHY YOU SHOULD OBSERVE THEM.
9. Proper structure for Records and Bookkeeping:
To build a successful business model you must keep stock of your business. Bookkeeping is the practice of recording incoming and outgoing cash, or cash flow, in your business. This system involves recording all financial transactions in your business, including expenses such as materials, services, and payroll, as well as income, like customer or client payments for goods and services.
Bookkeeping helps you to track the growth and well doing of your business and strategize for the future.
It also helps you to show investors your journey and growth so far in proving that your business is profitable for investment.
Reinvent your value system:
In building a successful business, you must be able to reinvent the value you are providing. Reinvention is about infusing value systems into trends, thus you need to have a key understanding of trends. You must be able to take advantage of technological advancements to ensure that your value does not slip into being redundant.
For insight on how you can reinvent your value system, see our article on How You Can Build A Sustainable Business Model As An Entrepreneur.
Address setbacks from the right perspective:
To build a successful business model you must be an entrepreneur who considers mistakes and setbacks as an opportunity to learn.
You mustn’t see setbacks as permanent circumstances but as one which you can work through. Instability and risk are part of the life of an entrepreneur, and so you must learn to make yourself more tolerant to the pain of uncertainty.
Explore insurance options:
As a business owner you should guard yourself against setbacks that may hinder the progress of your business . These setbacks may include, unexpected occurrences of theft, breakages, lootings, fires, floods, strikes, the death of the owner of the business and any other crisis that could befall a business. Crisis are a normal part of doing business and so as a business owner you need to properly plan and manage crisis.
To know why exploring insurance options is very important for building a successful business model, see our article on BUSINESS CONTINUITY: TAKING ADVANTAGE OF INSURANCE.
Conclusively to be a successful serial entrepreneur
You must be optimistic and realistic.
You must have the desire to keep innovating.
You must be confident.
You must be detailed and articulate.
You must be patient with the ability to learn from mistakes.