7 Ways to Ensure Success and Profitability When Starting a Business
Most entrepreneurs come up with an idea for a business, put together a business plan, raise the necessary capital (either investors or personal savings), then bring it to market and hope to survive. The unfortunate truth is most will not.
Today’s most successful entrepreneurs have discovered a secret to success and profitability. They start their business backwards!
Here are seven ways to guarantee success and profitability starting a business:
1. Start by identifying a customer you want to serve.
Imagine if you could spend all day with the people you enjoy the most. Who would they be? Now, imagine if you could add value to these people you care so much about, enrich their lives, and get paid to do it!
For many of today’s most successful entrepreneurs, this is not a figment of their imagination. It is their reality because they begin by identifying the customers they want to serve. You can too!
Begin by identifying the people you want to wake up every day and trade your life to serve. This simple first step will ensure you will feel fulfilled and rewarded as you begin the time consuming process of launching your business.
2. Talk to your customers.
You have identified your ideal customer. Now you have two options: you can guess what products or services they want, or you can go talk to them and ask them what they want. Seems like an obvious choice, right?
The reality is that too many businesses guess what their customers want. This is the reason the majority of startups fail. They do not understand the needs of their customers.
To set yourself apart, talk to your customers. Ask questions with the goal of identifying a problem that is deep and painful. Once you find a pain that is consistently shared among them, you know you can take the next step.
3. Let your customers create your business.
Your customers are marketing geniuses, as they can tell you the exact solution to solve their pain.
I followed this process myself. After launching my podcast The Mentee, I interviewed my listeners to find a pain they wanted me to solve. They told me they wanted to learn how to find their own high-level mentors and create a seven-figure network. Then they told me what specific topics they wanted to learn and in the process wrote the content for me. The ideas I received from them were far better than the ones I came up with by myself!
4. Presell your product.
At this point, you need to identify how much you should charge for your solution. Remember, your customers are marketing geniuses. Ask them, “If I were to bring something like this to market, how much would you pay for this?” Then ask them to pay for it upfront.
You can incentivize them to jump on board as a beta-user or founding member by adding additional value to them. Here are a few ways:
Giving them intimate access to you as the founder. They will be able to give feedback on the development of the solution so it customized to their needs. This really helps you too.
Offer to lock this introductory rate in for the life. One key point, they must actually pay for it up front and not just say they would pay for it. It is easy for a customer to say they are interested in something. This is not enough validation to launch your business. If they are willing to put their money where their mouth is, then you have validated your business and locked in a customer base.
5. Launch the business when you have sufficient funds.
Once you have pre-sold enough to cover your startup costs, you are ready to take action and build the business. This reduces your risk by not having to fund the launch yourself. It also allows you to start with a strong customer base that you can work closely with to ensure the product is exactly what they are looking for.
6. Create your MVP and let your customers improve it.
Your job is to get a minimum viable product (MVP) to your founding members. If you have done a good job setting expectations, these members are expecting to give you feedback to enhance the product, so don’t worry about it being perfect. Let them help you make it better! You will end up with a better product, and they will feel emotionally tied to you and the solution.
7. Scale your business.
Now it is time to scale the business. A few ways you can do this is by investing in marketing and considering affiliate relationships and joint ventures. You can confidently invest in these areas because you have a product that was created for your ideal customers, by your ideal customers. This means you are not guessing it will work -- you know it will work because your customers told you so.
If you are ready to take the plunge into entrepreneurship, follow these steps to guarantee your success and profitability.