Essentials for Startups and Early-stage Business
Every business startup is based on its own special business model and value proposition. At the same time, every startup like any other business, has a range of functions to fulfil—pieces of the puzzle that have to fit together in a meaningful way. For a startups and early-stage businesses, the names of those functions are pretty much the same as those in established companies, even if there is no actual department set up to deal with the work. The organization chart will get filled in over time.
However, in the startup phase what needs to get done under any of these functions is very different. Here we look at each of the functions and show what these special tasks are.
These are the six essentials:
The bad news is that you need to think about all six from the start, but the good news is that you will almost certainly not nail them all down before opening for business.
Planning
If you have been thinking about starting a business, you will have across the term Business Plan. Whether it is a full-blown document full of fancy charts, well-researched statistics and detailed financials, and accompanied by slick Power Point visuals—or the scribbles on the back of a dog-eared envelope, you need a plan.
But, do not confuse the map for the territory. Too many eager entrepreneurs have spent months crafting an exquisite business plan and wonder why they never managed to get the business idea off the ground. They may have simply wasted months of toil and missed sales. A half-completed business plan but a flow of revenue will win every time. Read more on business planning...
Selling
You may be wondering why I put selling before marketing. I hear you say that it must be the other way around. Of course you need to have a marketing focus. That will have been part of the business model and the value proposition that you conceived when you were getting started. Your marketing and brand strategy must be clear to you, even if not written down in a formal marketing plan.
But with no sales coming in all you are going to be doing is draining cash. As the venture capitalists say your 'burn rate' will likely put you in a fizzling rocket category before take off. Sales are undoubtedly your best form of financing. Managing your cash flow means being parsimonious with your expenditure, but whatever funds you have, they need topping up with revenue. Read more on selling...
Marketing
You have heard that marketing is all about the 4 'Ps': Product, Price, Place
and Promotion—what, how much, where and how. It is and rather a lot more besides. First you will have defined your target market and then you will have started to create your brand.
Don't be blinded and think that all four 'P' boxes have to be filled in. What's more important than anything these days, is to be engaged with your customers—by every means available. There are lots and above all: right near you in your own locality and spread all over the globe via the Internet. Don't miss opportunities for dialog: listen as well as tell.
In a startup business, the brand will be an aggregate of all the company's behaviors, not just the product or service. You will be building reputation from day one. You should see marketing as a process, not just a series of actions. You will have sensed what value your customers seek and ultimately you will seek to deliver on that value and aim to keep delivering as the business develops. Read more on marketing...
Financing
The essential you know all about. You are likely to say you do not have 
enough of it. But lack of finance halts very few startups in their tracks. Complex technology ventures or high capital intensity projects, maybe. For most of us it is the way that we finance that is critical—and, of course, the way we spend our funds.
You almost certainly have your shirt on now and wisely, do not wish to lose it.
The key is to work out how little money you need, rather than how much money you want. There are many creative ways of financing the business and you will be wise to 'bootstrap'. This is the way to go, especially in a period of tight money. In any case, even the super successful startups in the Inc. Magazine 'Inc 500' are self-financed to an overwhelming degree (over 80 per cent). Read more on financing...
Organizing
This may seem like the least exciting essential. In reality, you can apply a lot of creativity to it and keep out of trouble, too. The place to start is with you. How do you organize yourself. If you can make a success of that you are well on the way.
There are some essentials, like what business structure will you use, are you going it alone or are partners important, and then how will you organize contacts? How will you measure progress? If you do not know what you are about, then there is no yardstick that will help. (Thanks for the fractal, 'Trifold', to Sven Geier at Caltech.)
There are some formalities to think about. Do you want the business to have a separate identity and if so, how is it best to incorporate? Think about it carefully from liability, tax and appearance points of view. If you sell services, consider the special IRS rules about independent contractors. Consider your medium term goals and how they may impact organizational decisions you make now. Read more about organizing...
Leading & Managing
This is the essential daily activity that keeps the whole show on the road. It has many facets and a often is not the subject of the entrepreneur's attention.
However, there are a few key areas that are neglected at the entrepreneur's peril. The management of resources is critical. On this critical list there are three resources:
- relationships: inside and outside the business
- money: the lifeblood of the business—expenditure and income
- direction: knowing how and where the business is going
You may have the most spectacular product in the world, but if you take your eye off any of these three for a moment, then the brilliance of the idea will tarnish very quickly. Read more about leading & managing...
WorkSavvy
LLC—"Sustainability from the Startup". A company in Vermont, USA, working worldwide—