ELIAS PACHESO
Many young people have ideas and want to start their own businesses. As a Startup Advisor at Tech Hub Harare, I often get asked the following questions and want to provide a few answers in the hope that this help more start-up founders grappling with the same issues:
- How do I register my business?
- Where can I get capital for my business?
- How do I market my products and services?
- Where can I get computer programmers to code my application?
Tech Hub is helping start-ups across the country start and grow their ventures. Most start-up founders have ever experienced starting and running a successful business. Every experience is therefore new to them. For them the formula for success is IDEA + FUNDING = LOTS OF MONEY. This is one of the biggest problems facing my Zimbabwean start-ups. Even before value is created start-up assume that their idea is worth a lot of money and that anyone who wants to participate in their venture should pay a lot of money to get in before the idea is a proven or successful business model.
Because registering a business is very easy these days, anyone with the desire and will power can do it! You can do it on your own through the Registrar of companies at http://www.dcip.gov.zw or you can contract someone to do it for you. A simple search on the internet will reveal a number of companies offering these services. Why should register your start-up early in the game? It is important because you show that you are professional from day one. As a registered company, you can sue or be sued and a company ensures that your own personal affairs are limited to your directorship of the company.
Once your business is registered finding funding is one of the most difficult things especially in the formative stages of your business. Why is this so, early on in the life of your start-up there is just too much risk involved but the value you create as you develop it improves your chances of getting funded. There are many types of financing structures that your start-up can access but this is not the focus on this article to today. We will look at this topic in detail in the future.
Investors often look for traction in any business before considering investing. Is your business recording sales? Are you growing sales? How big is your market? Do you have the right team in place? And so on. A lot for start-up founders jump the gun and try and raise funds before they even start recording any movement in their venture. Investors look to invest in businesses that maximise their returns while minimising the risk of losing money.
No matter how attractive your numbers look or how clever your idea sounds, in my experience investors are looking for concrete proof that your business model is working and that it can be scaled and benefit from their capital injection. As a start-up founder don’t pre-occupy your mind with raising money. Spend your time working on how to create a repeatable sales process that will ensure that when you receive the money you need to expand the system works.
This takes us to the next step of creating a successful business. Sales, sales, sales and more sales. Without sales your business has no chance of surviving. Many start-ups fail to make sales because they did not spend enough time thinking about what problem they were trying to solve and whether there was a big enough market to make it worth their while. Early on when I started my own start-up venture I made the same costly mistake. I spent all the money I had on some pieces of equipment after wrongly assuming that the few people that were showing up in my store to get a service was my target market.
It is very easy to make wrong assumptions when you are starting a business and once you go down the wrong path and make some financial commitments you are almost always going to justify your mistakes and dig an even bigger hole. This is why it is important as a start-up founder to spend more time testing and researching your idea before you invest in it. That way you identify what to focus on and are almost always assured that it will work!
How to market your products and services is a whole topic on its own but thankfully there are so many resources on the internet these days that you can rely on to guide you on the best approach to take. Here a few tips to get started:
- You start by defining your target audience—consumers, businesses, or both.
- You research the competition.
- You identify how to reach your customers, that is sales channels.
- You then develop a product story.
- And finally you launch your plan.
These steps are here to guide you and show what is important for you to focus on. Without a plan your start-up is going to fail. To succeed you need to use the correct tools to reach the correct audience because it is that audience which is going to buy from you not just everyone who comes across your message.
If you decide the best way to reach your audience is by way of a web based application then you must find the best way of launching that web application. Many start-ups fail to take off because they can’t find the right resources to launch the application. Through no fault of their own start-up founders either find the wrong resources or can’t afford to pay for the development work.
Before engaging the right developer look at their background and what work they have done before. More importantly look for other ways of launching your application. You can have it customised and developed later if you need to add more features. We are so fortunate to have many opensource alternatives that you can simply download and customise these days with some basic computer programming skills. If you intend to use technology in your start-up invest sometime in learning web technologies. These skills will go a long way in helping you save on costs early on in the development of your start-up venture.
If you found the information in this article useful and are looking for free advice on how to grow your startup, please reach out to Tech Hub Harare at hararehub@gmail.com or visit our website www.cowork.co.zw
