( when Starting a Business )
A Talk by John Edwards, SCORE Counselor at Entrepreneur Meetup 8/20/09 enhanced by Peter / Organizer
1. Entrepreneur usually don’t learn how to do Cash Flow, until they might not make Payroll. Recommendation: do a Cash Flow on your Personal Finances. If you don’t want to do it, hire an expert to do it.
2. Over-Estimating the Market size, by thinking you have an entire huge market, when you just have a narrow niche for your Product.
3. Under-Estimating the Competition. Not doing sufficient Research to find your competition and not getting to know their products, so you can determine where your product is better or worse.
4. Understanding the Customer & their real needs. Ask potential Customers (your Target Market), if your product would solve a significant problem, they’d like to solve and be cost effective way to them. Go into deep details on their applications, to determine your strengths & weakness.
5. Not having the Support of your most Significant Other. Do they realize how demanding a Startup is? Are they willing to sacrifice the short-term pain, to get the long-term gain? Will they be working with you? If so, define your roles, so you have objective plans when contingencies come up.
6. Planning & following your Action Plan. Periodic Planning to determine which tasks to do and their priority. Periodic Reviews to determine if you’re meeting the goals of your plan, why/why not, make adjustments to the plan (if needed) & reset the priority.
7. Decisions on Issues. Knowing when an Issue is significantly important to make a decision about, then chosing & implementing the decision.
8. Monitoring the Market & your Operation, so you know when/how to adopt to changing conditions.
9. Not having a Business Plan (including Marketing Plan & Financial Projections). A Biz Plan is used to: a) clarify your concept and what you have to do, to bring your product to market to make money, b) communicate your plan to others (Co-Founders, Mgt Team, Consultants, Advisors, etc) and c) convey your “concept” to potential Investors.
10. Not having an Exit Strategy: of IPO, M&A Buyout, Partnership to determine when & how you want to complete your involvement in the company.
11. Not defining Roles & Responsibilities of Key Staff, so both parties understand them. R&R can be used in hiring and also can be used to measure their performance.
12. Not defining Core Values of the Company. Not hiring people that share the same values and will commit to maintain the values.
Free Business Counseling is available at SCORE. Call 408-288-8479
Comments: What do you think? Can you add any?