Startup Success: What You Should Know About Building a Business

Starting your own business is often filled with apprehension and problems. It’s also pretty scary. On day one you are the top of the world and the next day you are worrying about money.

Take Jake for instance, who started a dog-walking app called “Paws on the Go” last year. He thought it would be easy to run. It wasn’t. But he learned a ton, and now his app is actually making money! His story, and others like it, taught me a lot about what really happens when you start a business.

Don’t Fall in Love With Your Idea (Fall in Love With the Problem)

I used to think having a “brilliant idea” was all you needed. Wrong! Most startups fail because they make something nobody actually wants. Ouch.

Take my friend Emma. She spent six months building an app that helps people organize their sock drawers. She thought it was genius. She was super proud of all the features. But guess what? Nobody cared about organizing their socks so much so that they need an app and pay for the app.

If she had talked to potential customers first, she would’ve saved a lot of time.

What should she have done instead? Focus on solving a real problem that bugs people enough that they’ll throw money at you to fix it.

Dropbox is a perfect example of getting this right. Before building anything fancy, the founder just made a simple video showing how the product would work. Tons of people signed up for the waiting list right away! That told him people actually wanted what he was building.

Money Stuff Is Boring But Super Important

Let’s be real. Money is confusing and math is hard. But ignoring the money side of your business is like trying to drive a car without looking at the gas gauge. You’re gonna end up on the road without any help.

Rosa started a cupcake business from her kitchen. Her reason? The cakes she sold had to be affordable to people.

She charged $10 per cupcake. But then she shortly realized that the ingredients, packaging, and time cost her about $11 per cupcake. It was super bad.

She then had to make a choice between keeping cookies affordable and or raising prices just enough to make a profit. If not she would go out of business.

The solution? She then increased the price to $15 per cupcake and people still bought the delicious cupcakes.

Now she actually makes a profit on each sale. Here’s some simple money stuff to watch:

• How much does it cost to make your product or provide your service?
• How much are people willing to pay?
• How long can you survive before making money? (This is called “runway” and it’s super important!)
• What’s your “burn rate” (how fast you’re spending money)?

One cool trick: start charging for your product as soon as possible. Even if it’s not perfect yet. Getting real customers to pay real money is the best way to know if your business might actually work. And if you need to get funds to get started, consider turning to a pitch deck design company that can take care of a perfect pitch and therefore increase your chances of attracting investors.

Be Uncomfortable

Starting a business means doing things that are not everyday. It is doing new things and managing all of these things at the same time. Most days you are just lost.

My uncle started a small accounting firm after working for a big company for 15 years. On his first day as his own boss, he thought to himself as what he would do next.

There was nobody telling him what to do and this weird feeling can make you pretty uneasy to begin with.

He had to learn how to find clients, create a website, set his prices, and do his own taxes. He messed up a bunch of times. Once he accidentally deleted his entire client database! He almost gave up that day. But he figured it out and now has a successful business.

The lesson? You’re gonna feel stupid sometimes. You will learn to make mistakes. This is part of the process and not signaling you to quit.

People Matter More Than Your Amazing Technology

You might think having the coolest, most advanced product will guarantee success. Nope! Most of the time, the businesses that win are the ones with the best team and strongest relationships.

Remember Friendster? Probably not, but it was basically Facebook before Facebook existed. It had a huge head start, but Facebook still won. Why? Partly because Mark Zuckerberg built a stronger team and focused obsessively on what users actually wanted.

Building a great team is super hard when you’re just starting out. You can’t pay much, and the work is stressful. So how do you attract awesome people?

• Share your excitement about the problem you’re solving
• Be honest about the challenges
• Give people real ownership in the business
• Create a fun place to work (even if your “office” is just a coffee shop)

My friend Carlos started a landscaping business and couldn’t afford to hire experienced workers. Carlos spent extra time training his friends and family and made work fun with competitions and pizza parties. Five years later, those same “inexperienced kids” are now running crews of their own in his growing business.

Start Small, Then Grow (The MVP Thing)

You’ve probably heard of “MVP” – it stands for Minimum Viable Product. Basically, it means start with the simplest version of your product that someone might pay for.

This is hard! When you imagine a perfect product with different nice features it feels inherently wrong to release it without all of its features. It is however the right move.

Think about Instagram. When Instagram began it was a small app that let you share photos online.

But they got it out there, saw how people used it, and improved it based on real feedback. Smart!

My sister launched a tutoring business last year. Instead of creating a fancy website with online scheduling, payment processing, and a mobile app right away, she just made a simple Google form and shared it on Facebook. She got three clients in the first week! Once she had real customers and was making money, she gradually added more professional features.

Failing Is Actually Kind of Awesome (If You Learn From It)

Get ready to fail. A lot. But here’s what you need to know. Failing is the beginning and not the end. It’s part of every journey. And almost all businesses face several setbacks.

When I started a t shirt business, it was a complete disaster. I got 200 shirts with designs that I thought would sell. They didn’t sell.

I still have about 180 of those shirts in my parents’ garage! But that failure taught me to test my ideas with potential customers before investing a bunch of money.

The key is to fail fast. And to fail affordably. Don’t spend six months and all your money building something before finding out if people want it. Do quick, inexpensive experiments to test your assumptions.

You Need Less Money Than You Think

TV shows like Shark Tank make it seem like you need a ton of money to start a business. Not true! Many successful companies started with very little.

MailChimp, which is now worth billions, didn’t take any outside investment for years. They started small and grew with the money they made from customers.

Ways to start without much money:

• Use free tools and services (there are so many these days!)
• Work from home or from coffee shops instead of renting an office
• Start as a side hustle while keeping your day job
• Focus on getting paying customers right away
• Trade services with other small businesses

My friend Zoe started a graphic design business with just her laptop and some free software. Her first “office” was a corner table at Starbucks. She reinvested every dollar she made back into better equipment and software. After a year, she was making enough to quit her day job. Two years later, she has three employees and a real office. She never needed a loan or investor!

Find People Who Get It

Starting a business can get frustrating. Your friends and family may not have a clue as to what you want something so bad.

Finding a community of other entrepreneurs is super important.

There are tons of free or cheap ways to connect with other business owners:

• Local meetup groups
• Online forums and Facebook groups
• Co-working spaces
• Small business associations
• Industry-specific conferences (many have student or startup discounts)

Talking to other people who are going through the same challenges can save your sanity! Plus, they might have solutions to problems you’re facing.

My brother joined a weekly “entrepreneur breakfast” group when he started his web design business. Every Friday, they’d meet for breakfast and talk about their wins and challenges. One morning, he mentioned he was struggling to find new clients. Another person in the group connected him with a company that needed exactly his services. That one connection led to his biggest client!

Sometimes You Need to Pivot (Change Direction)

Starting with a plan is ice. Sometimes if your first idea doesn’t pan out, change directions. This is called pivoting. And its part of successful business.

Twitter started as a podcast platform called Odeo. When Apple launched iTunes and made their original business model obsolete, they had to pivot. They ended up creating Twitter instead.

Good call!

Don’t be so in love with your original idea that you can’t see when it’s time to try something new.

Real Growth Takes Time (Ignore Those “Overnight Success” Stories)

We’ve all heard stories about apps that blow up overnight or businesses that make millions in their first year. Those stories are exciting but SUPER rare.

Most successful businesses take years to really take off. The “overnight successes” you hear about usually spent years struggling before their big break.

Airbnb’s founders maxed out their credit cards and sold cereal boxes (seriously, they created “Obama O’s” cereal during the 2008 election) just to keep their business alive in the early days. Now they’re worth billions, but it wasn’t quick or easy.

My cousin’s coffee shop took three years before it was consistently profitable. Year one was exciting but scary. Year two was just plain hard – she almost closed down twice. Year three was when things finally clicked and she started paying herself a decent salary. If she had expected immediate success, she would have quit during the tough times.

Be patient and celebrate small wins along the way!

Have Fun With It!

Last but super important: try to have some fun! Building a business is hard work, but if you’re not enjoying at least parts of it, something’s wrong.

Richard Branson, who started Virgin, is worth billions but still makes sure to have fun with his businesses. He once dressed up as a bride when launching Virgin Brides! He knows that having fun makes the hard work worthwhile.

Final Thoughts

Starting a new business is never easy. But it also rewards you in many ways.

You’ll learn more about yourself and what you’re capable of than you ever imagined.

Some days will be amazing – like when you get your first customer or make your first profit. Other days will make you question everything. That’s normal!

Solve a real problem to begin with. That’s what matters the most.