Ever thought of running your own business? Does the thought of having no boss to answer to appeal to you? Well, before you decide to just start your own business, there are a few things you might want to think about first. We had a chat with Joe Leese, whose fitness app Runnit has benefitted from help and support at the Wayra Academy (O2′s start-up incubator), to find out more about what you need to consider before going into business.
Funnily enough, businesses cost money to run. So you’ll need to find out if people are actually interested enough in your product to pay you money for it. For example, with Runnit, Joe had to work out if brands would be willing to offer rewards through the app so he designed what the app would look like and had meetings with a number of companies to test it out. From those initial meetings he had about ten brands confirm that they’d be interested in offering deals and paying for that service. “As early as possible get out and start speaking to the people who you think you are going to be charging,” Joe advises. “See if it’s something they’d be willing to pay for and if they will pay you as much as you think.”
You’ll need to identify what skills you already have and what skills you might need to run your business successfully. You won’t be able to do everything yourself, you’ll need to find other people to do the things that you can’t do. “I knew that I could design the app and get it in front of brands who want to use it,” Joe says. “But I had no development experience whatsoever so I knew I had to find someone to build it. You have to work out how much you can pay someone to do it or how much of the business you’re going to give away to get someone with the skills that you need.”
Sometimes you’ll need to learn some of the skills yourself – not necessarily to be able to do the jobs yourself but to have a better understanding of what the people you’re working with have to do to complete the task at hand. “I’ve found that at least knowing the basics of code, how it all works and understand a little about what is involved is quite important,” Joe says. “It can save you a lot of time, a lot of money and a lot of hassle in communicating with people if you know what it is you want them to do and roughly what they’re going to have to do to build it.”
“Having at least a basic understanding – not necessarily in depth – of what needs to be done can help you be a bit more prepared if someone’s trying to rip you off as well,” Joe adds.
This is one of the most important questions that you can ask yourself as an entrepreneur. Joe says that it’s important to know where you want to end up but to break that down into small achievable tasks – whether that’s running a pilot scheme or getting the designs for your product sorted. “Test things in small segments as much as possible,” Joe recommends. “If you have an idea, try and prove that idea before you plough lots of time and effort and money into it. Test things and take small steps rather than try to get to the finished product straight away.”
Founding a business is easy, right? Well, maybe. But what do you know about equity and shares and investors? And how about profit margins and mission statements and term sheets? You’ll need to have at least a basic understanding of how business work before you get started or you’ll risk failure before you’ve ever got your business off the ground. “I knew very, very little about running a business when I got started,” Joe admits. “That’s why being at Wayra is so great. It’s really important to do a lot of research into business and how it works – things like investment and financing and equity and the legal side of things. You need an overview of what’s involved in setting up a business.”
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