Congratulations on starting your company! Welcome to the period after you’ve begun the entrepreneurial journey but haven’t quite built a business, yet.
Can you clearly articulate why you’re in business? Your purpose, mission, vision, and goals are important foundations that will help you make effective decisions, hire motivated and loyal people, and stay on track when life does its best to derail you.
In addition to launching your prototype solution, you’ll need to build customer awareness, grow an engaged audience, validate your concept with early adopters, and make your first sales. Achieving proof of concept is the primary milestone of this phase.
Let’s also talk about identifying and evaluating markets, building a reputable brand, and putting in place the basic systems and processes that will help your fledgling business grow.
Finally, there’s the daunting process of raising (and wisely spending) seed capital. Selling part of your business to outsiders can feel threatening and, at times, insulting. A little know-how can significantly improve your chances of raising capital and feeling good about it afterwards.
Creating a product and convincing early adopters to pay for it is a tremendous achievement. Many startup ideas never make that leap into the world of real business. Next, you need to prove that the business is sustainable, which requires a whole new set of skills and decisions.
This phase revolves around your go-to-market strategy, with milestones tied to growing your audience, generating a sales pipeline, adding customers, and reaching profitability. A key focus will be understanding your customers and their buying journeys to enable customer-centric product development and messaging.
You’ll also have to effectively manage scarce resources. You can’t hire everyone at once, for both financial and practical reasons, so how do you decide who to hire next? Raising more seed investment or even your first round of venture capital will become essential as your growing enterprise becomes increasingly hungry for working capital.
Leading an increasingly sophisticated business can be painful and ‘real’ businesses require structure and processes. Let’s talk about managing the overwhelm, staying focused on what’s most important, and keeping it fun!
Should you focus on being great at one thing or develop a broader product portfolio? How do you earn and maintain a social license to operate? How do you maximize customer retention and turn the most loyal into advocates for your brand?
With your track record building, it’s time for sophisticated marketing, sales, and customer experience strategies, which require investment in technology, automation, and metrics-based optimization. Thanks to an array of accessible and affordable software, it’s possible for one person to achieve what a few years ago would have taken an entire department.
Key milestones in this phase include delivering on revenue and profitability promises, demonstrating positive social and environmental impact, and proving you can manage customer acquisition costs while driving up lifetime customer value.
You might also consider inorganic growth opportunities, such as adding a product line - or even an entire business - through a merger or acquisition. Whichever path is right for your business, it will usually involve selling your vision to venture capitalists or private equity investors in search of your next round of funding.
You should also think about the end game. Unless you want to build a lifestyle business, or can achieve enough growth to justify an IPO, you’ll be focused on position your company for a profitable exit to an investor or strategic buyer.
