One day you’re sitting in the middle of a faceless thankless office pretending to do whatever it is that they pay you to do, when BOOM, your head almost explodes with the force of impact of a business idea popping into existence. It’s amazing, it’s earth-shattering, it’s going to be the biggest thing since sliced bread met the sandwich toaster!
OK, I’ve had one or two of these moments, but most people decide to leave their humdrum employment for far more practical reasons, and this is why choosing the right business to launch is the most important first step any entrepreneur needs to take.
When looking for business start-up funding, whether you’re going to a bank, a firm of venture capitalists or facing a room full of eager Angel investors, you’ll need to have a clear idea as to why you are launching the business. This foundation will shape the entire future of your venture and those offering business start-up funding will want to understand your reasoning.
So, if you’re looking to start a business but don’t know quite what direction to head off in, how do you choose what’s right for you?
1. Know thyself – The self audit
Investors offering business start-up funding will be keen to understand what makes you tick, so a self audit is a good way of brushing up on all things “yes”. Ask yourself;
- What are you good at, and can this be turned into a business?
- What are your interests and hobbies and can they be turned into a business?
- Do you want to invent something brand new or sell something that already exists?
- Do you want to offer a service or a product?
- Do you wish to focus on the national or international market?
There are of course many more questions but you should be able to get the general drift from these few.2. Base your business on a passion and you can’t go far wrong
If you’re passionate about your work you’re far more likely to be good at it, so why not consider things from the other direction. Why don’t you choose to work doing something you’re passionate about?
When looking for business start-up funding one of the first things an investor will look for is passion, passion for your business, its sector and your customers. Think, what do you enjoy most in life, and can it be incorporated into a profitable business?
3. Adapt an already successful concept
My favourite in recent years is the increasingly popular remote location software business. This used technology that was already in existence for PC support, where the outsourced company would take control of your computer from their remote location to solve an issue you were having. It was then simply repackaged for an entirely different market.
As far as I’m concerned this was genius, and probably had the business start-up funding flowing. This now lucrative sector grew from nothing just a few years ago, and all because some bright spark decided to adapt an already successful concept.
4. Follow the smart money
Now personally I like to think of myself as an innovator, a trail blazer, a business maverick, but this life is not for everyone. The vast majority of successful business owners launched themselves into the entrepreneurial world with a business that already existed, but became successful by simply being better than their competitors.
Business start-up funding can be forthcoming for ventures that have clear direction and unique selling point as well as those that recognise growth markets and upcoming trends.
Angels with business start-up funding are sticklers for detail and they’ll often wish to know the whole story behind your business to help them determine what you might do with their money.
So whatever business you decide to go into it’s important to be able to clearly define why you chose it both verbally in funding presentations and in your business plan, which anyone looking to lend you start-up finance would need to view.
This article was written for Bytestart by Bill Morrow, founder of Angels Den.
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