The Basics for Starting a Business
Editor's note: This is the third column of a new series of weekly Q&As in which entrepreneurs featured in the Women Entrepreneurs Special Report answer questions submitted by readers. You can submit a question for consideration here by writing to email@example.com.
I am a 24-year-old female engineering grad from Chennai, India. I have been working in my family's varied businesses—hotel, retail, health care, and real estate. I have also been running a chain of diagnostic and imaging centers for the past year. Now, I would like to start something of my own. What is your advice on getting started?
There are many things to consider when starting your own business. But first, begin with the basics. Be sure you are doing something:
1. That someone will care about (customers/partners).
2. That isn't currently being done, isn't being done well, or for which you have a new and unique spin.
3. You love to do—in other words, you have a passion for it.
4. You do extremely well.
5. That is fundable.
Next, write a brief business plan about your market, your products/solutions or services, your value proposition vs. the competition's, how much money you'll need, what your business model looks like, who is on your team, etc.
Once this is done, you will need to raise money. This involves taking your business plan to potential investors and trying to get them to fund your idea. The traditional approach is venture capital, but there are many possibilities. Which ones are best depend on a number of factors: your market, the country, who you know, what type of technology or service you want to provide, to name a few.
Another approach is using an angel investor. These can be smaller venture capitalists, people with personal wealth, or friends and family that can give you seed money. This approach allows you to walk before you run. You can develop a prototype and use it to sign up customers or partners.
This is usually a better source for raising money than more traditional VCs. For example, many VCs will not fund a software company unless you already have a working prototype, which you have done on seed money or while working another job. It always helps to show your "skin in the game" by investing your own money.
Finally, be prepared for around-the-clock work. When a business is new and growing, you don't have the luxury of weekends or delegating things to others. Work/life balance usually means work wins.
Be prepared to optimize your priorities around your job, especially in the initial stages. This means ensuring that you have the support of your family and whoever else is personally important to you so that you can focus on building a solid foundation for your new business. Have fun!