Start-ups may take a little extra effort to launch, but exciting when done well.
How will you approach starting a new business?
Last year in Australia there were 850,000 businesses started, well up from the 250,000 that have been started over recent years. This surge seems to be driven because jobs are becoming harder to get and younger people, in particular, are losing interest in the traditional work environment with all its pressures on the families and health.
This trend will probably continue as technology changes the entire work landscape. The Cloud technology has also had a big impact as people are able to set up businesses and follow their dream with a minimum of costs and frustrations.
“Technology is dominated by two types of people: those who understand what they do not manage, and those who manage what they do not understand”. Putt’s Law
The following is a snapshot of some of the many things that are changing the way we live and work.
Economy. Young people have grown up in a turbulent era, they look at interest rates as a barrier to building a successful business. They tend to fund their startups themselves (Bootstrapping) rather than borrow money and they are using alternative funding sources such as crowdfunding.
Money. Money is no longer the key driver as it was for those going into business. Lifestyle has come far more important.
Lifestyle. Many people starting businesses have one eye on how their business can enhance their lifestyle. Many will decide on the lifestyle they want and then seek a lifestyle business to suit.
Volunteering. Today’s young people say they want to make the world a better place, and job applicants increasingly evaluate their target companies by their attention to social justice and doing the right thing. That’s how they will run their own businesses, and we can expect a great deal of giving back from them, especially volunteering in a way that uses their talents and knowledge to help others.
Improving Value Chains. Young people today are extremely well networked, their use of social media has given them great opportunities to find the right people and organisations to help them.
Better Business Models. Today’s young people are smart, and the budding entrepreneurs among them will recognise that a good business model is a dependable way to ensure success.
Costs and investment. New businesses tend to appreciate the difference between a cost and an investment. There are surprising numbers of young people living with their parents to save money, This trend is likely to continue as they start new businesses. Hiring staff, or start flying business class is only done to meet an important objective.
Premises. New businesses are avoiding the temptation to move into expensive office space. They start and grow their businesses in the garage or their bedroom. Their nest step is probably a ‘serviced office’ which no longer has a stigma attached to them. Flexibility and mobility, allowing them to do business from anywhere, anytime are high on their agenda.
Marketing has changed. New business owners won’t be spending money on market research and surveys. They will gather their information from social media and their online communities. Social media will play an increasingly important role in product development and marketing.
Social Media. It is not going anywhere else but up. Social media is the new networking, and as young people launch businesses they will instinctively use social media to spread their message. Older business people need to understand that they need a strong social media presence if they are to survive.
Promotion. Start-ups are taking to the Cloud environment and using new ‘inbound marketing’ platforms for promoting their businesses and generating and nurturing the new customers they need.
Content. Content marketing is revolutionising marketing by opening up more opportunities as people tell their stories and promote their messages. Becoming recognised as a ‘thought leader’ is becoming important to many as they strive to be found in the busy marketplace.
Export. Today more and more businesses are born with an international focus. They see the world as a small place and they like to travel. The internet is facilitating new international markets like never before.
Advisors. It will be very important for new businesses to know what they don’t know, new business owners will spend on practical, reliable and useful expertise.
Partnerships. Many young people are not afraid of partnership to help them achieve their vision. They are more used to forming relationships today than ever before and a partnership to them is just another good relationship with some special agreements.
Innovation. Innovation is something that most new start-ups have come to appreciate. They know it must be ongoing is they are to survive and thrive.
Entrepreneurship. Is a word that has been misused. Just because you own a business doesn’t make you an entrepreneur, and you don’t have to be in business to be an entrepreneur. There are many different types of entrepreneurs. The important thing is to emulate entrepreneurial attributes or as many young people do, work with people who have the attributes they need.
Working environment. One of the things that young people are looking for today is a nice environment in which to work. They will put up with almost anything is they can see their environment improving. They want to have good equipment to work with and flexible working hours are rated highly.
Profit taking. If as a start-up you know your personal income will be okay and it will increase when the business is creating value for its customers, then the business is almost guaranteed to make a profit. They will forgo wages and do almost anything with the new technologies to ensure the business is profitable.
Cyber Security. Internet-savvy young business people are aware of the dangers of hacking, and cyber security making it a part of their business plans from day one. It is not an afterthought anymore, it is a necessity.
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Obviously, if you have worked in the same industry or a related industry before you start a business you will have an understanding of the products, customers, suppliers, competitors, channels of distribution, and the opportunities that exist to do things better.
This gives you a real advantage as you don’t have to learn everything about your chosen industry from scratch or by trial and error.
If you are a user of the products, even if you have not worked in the industry, you know the market from the customers’ perspective. You know the opportunities and pain points from personal experience.
My first business was an agricultural machinery dealership. I started it at the ripe old age of 23 and grew it into a multi-million-dollar business very quickly and enjoyed every minute of it. It gave us the lifestyle we wanted and life was good.
Why? Because I grew up on a highly mechanised farm and I understood machinery and enjoyed working with it. I came to understand the farm as a buyer of machinery and the problems customers had to overcome.
So, when I started the business I was off to a flying start. My expectations of a successful business were backed up with experience, as limited as that might have been.