But is there something you’ve forgotten to do? MT bent the ears of a few entrepreneurs who’ve been there, done that, to find out what they wish they’d thought of (or are pleased they did think of) before starting out.
1. HAVE A PLAN
A proper one, with research and stats and detailed strategies – not just the back of a napkin. ‘You need to set objectives and make sure that you are aiming high enough,’ says Homeserve founder Jeremy Middleton.
‘Then you need to do a common sense check by answering these questions, why will you beat your competitors? How realistic are your sales forecasts? What costs will you incur? What capital will you need? How much cash will you need to reach breakeven? What financial buffer do you need?’
‘When I started my business, I spent close to two years hidden away in my Yorkshire barn developing a prototype before I felt that it was at a point where I could pitch the product,’ adds Anaplan co-founder Michael Gould. ‘This level of planning is crucial to building a solid foundation for your business—particularly if you are trying to solve complex business problems.’
2. DOES THE WORLD REALLY NEED YOUR PRODUCT?
‘Spend all your time on achieving product-market fit until you have it,’ says Ryan Petersen, CEO and co-founder of Flexport. ‘Don’t get married to an idea before you are certain that yours is a solution to a common problem that people would be willing to pay for. Talk to users non-stop and build things based on their feedback.’
‘You always think you know what the market needs and wants, based on anecdotal evidence and previous experience, but there’s really no replacement for specific and detailed market research,’ adds Chirag Shah, CEO of Nucleus Commercial Finance. ‘Check and double check that there is demand for your product before you do anything.’
3. CHOOSE CO-FOUNDERS CAREFULLY
‘I’d previously run a business with a friend, who I quickly discovered had a moral compass that didn’t align with my own. Over time I lost all respect for him which impacted not only our relationship, but also the business,’ says Dr Aidan Bell, co-founder of Envirobuild.
‘At EnviroBuild James [Brueton] is a great business partner, not only in terms of competence, but also values, morals and temperament. If you’re running a business with someone, then who that person is will be among the most important decisions you’ll ever make; you can pivot your business plan much easier than you can a co-founder!’
4. BE CLEAR ABOUT YOUR AIMS
‘Define your vision, mission, strategy, and values before you get started,’ says Ishaan Malhi, CEO and founder of online mortgage broker Trussle. ‘It will provide invaluable clarity, focus, and alignment which will have both tangible and intangible benefits later on. For example, having a clear set of values will help your team make important decisions quickly and autonomously.’
‘Many entrepreneurs are, understandably, so consumed with the start-up and growth of their business in the first few years they can neglect to plan for their ultimate goal,’ adds Rachel Hannan, an angel investor who previously founded public sector search firm GatenbySanderson. ‘Having a 7-year exit plan from the start made it easier to scale the business in a way that would ensure it was sustainable once I’d exited.’
5. CHECK YOUR NAME
Company names matter, and if you get it wrong in the first instance then doing a rebrand can be a costly faff. ‘Register every variation of your web address so people don’t wind up starting similar businesses with similar names after you,’ says Matt Haworth, co-founder of Reason Digital. ‘Domain names seem to be the main way people brainstorm new names, rather than patents or trademarks, these days.’
Plus, if you’re planning to go international then it’s worth checking your name isn’t a taboo word in the language of one of your target markets.
6. LOCATION, LOCATION, LOCATION
Some entrepreneurs feel they need to be based in London or even jet off to Silicon Valley to be among like-minded businesspeople. But there’s plenty of opportunity in smaller towns and cities.
‘Basing Paperclip in Cardiff was the single most important decision that we made prior to launching the business, and I am incredibly glad that we did so to this day,’ says Alan Small. ‘London is a city of unlimited opportunity for business, technology, and start-ups – so turning our back on that was scary at first.
‘However, joining the flourishing tech scene in Cardiff has more than paid dividends. The talent pool, support, and access to like-minded individuals here has allowed us to launch, build, and scale Paperclip at half the cost whilst remaining just 2 short hours away from our investors and partners in London.’
7. GET SOME SMALL BUSINESS EXPERIENCE
Some people find entrepreneurship comes naturally, but if you’re used to treading the carpets of a big City bank or FTSE giant then it might be worth getting some hands-on experience at a start-up before striking out.
‘Being part of a business in its early stages is an incredible experience for anyone during their career, but for those people that want to start their own business, it’s the best learning opportunity you can ask for,’ says Robert Gryn, CEO and owner of Codewise.
‘It gave me unique insight into the everyday challenges that come with being responsible for a business and for your employees, and it taught me what is required of a leader in a fast growing technology company. Most importantly, it gave me the confidence to step out on my own and take a risk.’
8. CASH IS KING
‘In order to give your idea the best possible chance of success, it is wise to have cash reserves to carry you through 12 months or to keep your day job until the business model has been validated,’ says Norris Koppel, CEO and founder of instant current account provider Monese. ‘Constantly worrying about cash can really impact your energy levels and this is the last thing you want to worry about when building the next big thing.’
9. PLAY TO YOUR STRENGTHS
‘Delegation is key,’ says FreeAgent founder Ed Molyneux.’ I was terrible at delegating in the early days. Like many other self-employed people, I felt that the business was my baby and I wanted to stay in control of as much of it as I could
‘At some point, you have to realise that you can’t do everything yourself. By stepping back and identifying the parts where you’re not 100% proficient, you can then either delegate those tasks to someone else already in your business or specifically hire someone new who has more expertise than you to take on those responsibilities.’
‘I’m glad I listened to, and took, my Dad’s advice about realising my own capabilities and getting others to do the things I was a bit rubbish at,’ adds Rik Hellewell, MD of oven valeting franchise Ovenu. ‘I’ve extended that thinking over the years to include things that I don’t like doing such as accounts!’
10. DON’T EXPECT EVERYONE TO DRINK YOUR KOOL AID
‘As a starry-eyed idealist I made the mistake of believing that my team’s loyalty to the cause was as absolute as mine, and thus felt repeatedly let down over the years when individuals left to pursue what they saw as a better career path for them,’ says Adam Tavener, chairman of Clifton Asset Management and Alternative Business Funding. ‘In my younger days, I couldn’t help but take this personally, as a departure, in my mind, was tantamount to saying that my business wasn’t working.
‘It is far better to understand that people will leave from time to time; it’s not personal and they can have all sorts of reasons for doing so, but, unless they have done something really heinous like trying to damage your business on the way out, the best path is just to wish them well and get back to concentrating on delivering your own goals.’
11. BUILD A STRONG NETWORK
‘I wish I had engaged more with the entrepreneurial community and built a network of experienced go-to entrepreneurs to help steer and coach me in the earlier years,’ says Davie Chaplin, CEO and co-founder of CotnractorCalculator. ‘While I read tons of very valuable business books, I basically locked myself in a room for 5 years while I built the business all by myself – and no doubt repeated mistakes that others had already made.’
‘Having a strong network is key when it comes to making your own business a success – I took the leap and started up an in-game advertising agency when I was 22,’ adds Josh Graff, who was an an entrepreneur before becoming LinkedIn’s UK MD. ‘I was new to advertising and I was new to video games. I asked advice from anyone I could find within those industries that was willing to meet. From established CEOs to individual contributors at the beginning of their media agency careers; people were extraordinarily generous with their time and I took advantage to soak up as much information as possible.’
12. ASK FOR HELP
‘To me, undoubtedly the most sensible thing to do in order to inform your decision making process on starting a business is to identify a suitable mentor, i.e. somebody who has built or run a business and through their strategic advice can provide you with a few very important shortcuts in key areas, which otherwise can cost you the unnecessary time and money,’ says Natasha Bowes, MD and founder of Bio-tiful Dairy. ‘It is undoubtedly tricky to find the right person, and the best ones are those who have worked across industries and made their own costly mistakes!’