Sanjeev Nanda tips on How to Start a Company

8 Jun

Filled with the spirit of entrepreneurship, you want to take charge and launch your own business idea. However, before you start your company, you can benefit from lining up several important elements. Be armed with an excellent product idea that will weather the competition and appeal to a majority of customers. Have funding to sustain your operations long enough until your sales become self-sufficient. Finally, acquire the regulatory and government rights to operate a business.

Money

Sanjeev Nanda Money

Money is the backbone of any business

A frequent joke mentioned when people talk about starting their company is that money takes the first 10 slots of the top 12 things required for a successful business. This resonates true as the launch of a product idea consumes more resources than expected. You will need enough funds to cover your salary, compensations for teammates that are essential to the success of the product, prototype development, regulatory testing, and the overhead expenses of the business. Funding takes several months to gather and comes from gifts and loans from friends, or grants, or banks and venture investors. Banks and venture firms will expect the investment to be repaid with interest whereas grants extend the funds with no returns required.

Legal Setting

Each state carries its own requirements of business incorporation and legal compliance with the regulatory requirements of the industry around the product. Typically, the economic development department sponsored by each state can guide an entrepreneur with setting the business within the state’s guidelines.

Product Idea

The product being launched needs to stand above what the market can offer. The competitive advantage ought to be significant enough that customers will abandon any current competitor or practice to adopt this new solution.

Sanjeev Nanda Idea

One Great Idea is all you need

Hence, a product idea should not fuel an entrepreneurship adventure without having been vetted through interviews with future customers to understand the reasons that would convince them to buy your product. Then, with this insight into the customers’ preference, you can run a market analysis to establish how many customers will most probably buy the product.

Expertise

Running a company requires expertise in development, marketing and sales know-how, and legal and business development wisdom. Even though you may think that you can wear all these hats, you will benefit most from surrounding yourself with experts who have taken the road of launching a company before. By leveraging the wisdom they have acquired in the past, you will save time and increase your chances of succeeding. In your financial budget, do include funds to hire experts to complement your expertise.

Business Plan

A Business Plan represents the strategy that you will deploy to take the company to success. A business plan becomes necessary for soliciting funding or attracting experts. It fosters a platform from which to organize your thoughts in a strategic manner. Finally it projects what you should expect financially from launching your product idea and highlights gaps that need to be filled before starting the company.

Board of Directors

If you incorporate your company, you will be asked by the state to create a Board of Directors who hold legal and fiduciary responsibilities for the company. If you plan on being the Chief Executive Officer of the company you will most probably report to the Board of Directors and therefore need to think about who you would like to see in this overseeing function.

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