How To Identify The Perfect Start-up Opportunity And Properly Implement It
As the world is witnessing an exponential growth of the startup ecosystems – currently, there is a total of 25 startup ecosystems with an overall value of above $10 billion each – young entrepreneurs have more opportunities to begin their own projects.
In the past, it was very difficult to start a business without a huge capital but today, revolutionary innovations can happen in a basement, college dorm, or a garage. As a result, new startups appear every day, each of them striving to make it big.
However, for every successful startup, there’s a large number of businesses that fail. It’s no wonder that startups valued at over $1 billion are called ‘unicorns’ to represent the statistical rarity of their insane success. At the moment, the most valuable startup on a global level is WeCompany (formerly known as WeWork), which is valued at $47billion.
And in case you were wondering which types of startups are most profitable, TechCrunch has the answer: “eCommerce startups, Chrome extensions, mobile apps, enterprise SaaS, SMB SaaS — in that order.”
How to Identify the Perfect Start-Up Opportunity
When entrepreneurs decide to launch a startup, they usually go through several stages. The most important one is coming up with a great idea. Some of them already have ideas for years and are only looking for a chance to implement them. Others wait for an opportunity to present itself before they start looking for an idea.
However, both these groups are facing the same problem: how to recognize the perfect business opportunity and find the best ways to implement it.
The difference between great ideas and ordinary ones is the possibility of the former to transform into a scalable service or product. Hence, not all ideas are opportunities.
The perfect startup opportunity should have a number of specific aspects, including the right product, the right timing, and an added value for consumers.
Here are the best three approaches to help you identify a perfect startup opportunity:
#1 Observe Trends
Studying statistical reports conducted by specialized institutions and companies is the best way to determine current trends. Most of these reports are available free of charge but don’t hesitate to pay an extra buck to get access to more detailed and valuable info.
For example, the latest report by Transparency Market Research says that the global mobile payment technologies market is expected to grow at an annual rate of nearly 40% in the period from 2018 to 2026. This information clearly indicates a growing trend for mobile shopping, which might be a great opportunity for a startup.
#2 Solve a Problem
Identify people’s problems and come up with original solutions. Let’s take Netflix for example. The iconic streaming service eased a number of pain points: No more trips to the DVD store, no more pricey rentals (the monthly price for Netflix equals a few DVD rentals), no more organizing your life around watching your favorite shows, no more extra fees for late returns. With this in mind, it comes as no surprise that Netflix has a market of over $116 billion!
#3 Find a Gap in the Marketplace
Look for very specific customer segments that larger companies don’t serve because they’re targeting broader groups. For instance, back in the 1990s, Maktoob introduced an Arabic language interface for emails. At that time, there was no other free email service with such support. Maktoob noticed a gap in the market and took advantage of the opportunity to build one of the largest online service companies in the Arab world. In 2009, the company was acquired by Yahoo for $164 million.
How to Implement Your Startup Idea
Once you’ve identified the perfect startup opportunity, it’s time to implement it. Here’s are the three initial steps you need to take:
#1 Create a Business Model
Writing down a business model is more than drafting your business plan and identifying the products you want to sell. A strong business model should also map out how your business idea will develop and how you will create value for your customers. In addition, it should contain the parameters you will use to determine whether your idea has been successful.
#2 Secure Funding
In order to get your startup off the ground, you’ll need adequate funding. The good news is that investment in startups has become very popular. The number of investors who recognize the potential profit to be made from supporting the right company is growing: in the period from 2012 to 2017, the overall startup funding increased by 50%, with certain industries like robotics and manufacturing reporting more than 1,000% more funding in 2017. Investment funds like LTV SaaS Fund are constantly seeking great investment opportunities, so the chances to get noticed and become truly successful aren’t so small.
#3 Recruit a Team
Launching a startup is hard work and you can’t do it alone. Finding the right people to help you is even harder but it’s certainly worth the effort.
Besides you (the CEO), you’ll also need a full-stack engineer. If you can afford it, hire two engineers: a back-end engineer who focuses on how your company website works, and a front-end engineer who focuses on how it looks.
You should also have a marketing manager who will take care of messaging, content marketing, interaction with clients, managing social media profiles, PR your startup, etc.
The rest of the hires will depend on your industry and type of company. For instance, if you’re building a product or service from scratch, you’ll need a product manager. On the other hand, if you already have a basic version of the product and you’re focused on selling it over the phone, you’ll need a person to cover cold calling and closing sales.
The initial group of people you hire will set the company’s tone, so you need to make sure to choose the best ones.
For the rest of the tasks, you can rely on technology. There are dozens of online tools and services you can use to get the job done. For instance, pixelz.com is a great solution if you need great-looking images for your site but you can’t afford a pro photographer.
Launching a startup isn’t easy. You need to be prepared for a number of obstacles along the way, but don’t let them discourage you. Even after your company is up and running, it doesn’t mean that everything will go smoothly. Your business model will change, your investors will change, your staff will change… But a great vision, along with proper planning and execution will help you overcome the difficulties.
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