In order to succeed in today’s competitive startup market, you need to make sure that your business has all its important elements in place. According to “Launch your startup in a heartbeat framework” You need to develop your business model as precise as possible, build your product as lean as possible and finally promote your business as accurate as possible.
Have you ever wondered how to start a successful business that is difficult to compete with?
There are few types of startup founders who don’t get the entrepreneurship right! Unfortunately, most of the technical savvy early stage startups put their focus on product, which although to some extent is it required, but building a product based on no clarity about the future of your business put your success in jeopardy.
It really does not matter if you have just started a new business or you are still in the ideation phase, your business success heavily depends on how you set the important elements in place.
In this article, I’ll walk you through a 4 steps process based on the definitive guide for startup business plan & patterns to help you develop your business model and get your business running.
There is a huge misunderstanding among business owners and investors about business model and business planning. In the past you would have to produce a lengthy document with literally hundreds of pages, preparing a 3 years’ financial forecast and writing a long, useless and descriptive operational model.
In today’s ever changing and technology driven market, you need to use agility if you want to take your business to the next level. Pause for a moment and review your business model the right way.
Here is the Step by Step approach:
- Invite your stakeholders, decision makers, idea generators and basically your team to have a meeting. Your agenda would be to make sure that everyone is on the same page about where your business should be moving towards.
- Use less writing and presentation materials in this meeting, instead, try the visualizing techniques using the sticky notes and business model canvas.
- Give everyone a sticky note and ask them to use them whenever they want to raise a point or highlight an idea. When facilitating the session, ask the team to stick their notes on the business model canvas placed on the wall.
- Lead the meeting in an informal manner. Make sure everyone has the right to speak their mind as you’d be amazed with the great combination of ideas that introverts and extroverts bring to the table. Once everyone have the same picture about your business model in their mind you will feel a different energy in your company.
- Download the business model canvas template and place it on the wall. The most amazing thing about business model canvas is the fact that wherever your business need attention is explained in 9 building blocks of business model canvas (See image below).
Now that you have set up the environment and the pace of the meeting, it’s time to get to some detailed conversation. The following 4 step process simplifies the flow of your business planning session.
1. Who is our customer ?
Always start by asking open questions from your team and guide them to write down their answers on the sticky notes. Simply think of the group or niche who will potentially buy from you.
2. Channels to reach out to your customers ?
You need to build and maintain relationship with two groups, customers and suppliers. When you are launching a product based business your suppliers and promoters are your best channels to build relationship with.
In service based businesses, you have to find channel partners that add value to your value chain and help you offer a better customer experience to your customers. Simply look for long-term relationships that differentiates your startup’s offering from others.
3. How to boost your business?
In order to boost your business, you have to make sure that all the responsibilities and activities are well-defined. It’s essential for any startup to work in full speed and full power. In your meeting raise your point and brainstorm with your team and find a common ground on the following questions:
- When it comes to sales and marketing strategy, what would be your major activities?
- How about internal resources, what skill should you be looking for to improve your productivity?
4. What expenses do you have and which product/service generates revenue?
Your effort out to be on determining your revenue streams. In other words, how can you make money? Try to limit the channels because the less complicated it is, the easier to manage your business model. Ask your team to use their sticky notes and answer the following questions:
- What would be your major expenses? Is it the platform? Branding? People? etc.
- What investment areas you or your fund providers should look into that can step up your startup?
- Finally, How do you make money? Is it subscription? Commissions? Selling units? etc.
Here is the catch in Business planning that works approach.
Since this framework is a bit different from the old school lengthy business planning, you should validate your business model the soonest you have completed the first draft.
Don’t just stay in your office. Start asking feedback from your prospective customers or users. Consolidate the feedback and revisit your business model again and again. You might need to iterate a few times to get the company on the right direction.
Ehsan Jahandarpour is a globally recognized startup coach and inventor of the “Launch your startup in a heartbeat” framework. Ehsan has helped companies like Microsoft, PETRONAS, and many startups to take their business to the next level. He also shares his strategies, and proven startup frameworks in his blog https://jahandarpour.com. Follow him on Twitter @jahandarpour or linkedin.