3 Things You Need to Start a Business
Have you been thinking about starting a business? Are your daydreams filled with visions of entrepreneurship?
When you look back at your life, do you want to be able to say, “I changed the world; I started a business”?
Want to listen? There's an audio version below
So, you want to start a business. That's awesome! Starting a business is one of the best (and hardest) things I've ever done. But, as of right now, I have three.
My first business surrounds ellorywells.com where I publish books, host private mastermind groups for entrepreneurs, and offer 1×1 business coaching to highly motivated individuals.
My second business can be found at dwizzywidmedia.com and involves web design, building e-commerce platforms, and handling the online presence for businesses. We build and manage websites, host email marketing services, and offer support to business owners who don't want to get into the weeds of the technical aspects of their businesses.
My third business is CigarScore, and it's the best and largest online directory of cigar lounges, humidors, and cigar-friendly bars and restaurants in the United States. If you want to find where to smoke cigars, cigarscore.com is a fantastic resource for you.
Each of these businesses follows the advice listed in this post. And each of these businesses is profitable and can be managed from anywhere I have my laptop and an internet connection.
You might not want an online business. And, if not, that's totally fine, because the three things you need to start a business are universal.
Let's take a look.
3 Things You Need to Start a Business
#1: A Problem or Need
Since I own a company that designs and builds websites, you might have expected me to put “a website” as the first item on this list of things you need to start a business.
However, many businesses can succeed without a website, though I don't recommend it.
If you're going to start a business, the first thing you need is a problem to solve or a need that must be met. If you personally have this problem, even better.
Before I started CigarScore, I had to search (often for hours) to find a quality place to enjoy a cigar. Since Ashley and I travel the country now, finding where to smoke was becoming a challenge. Each city we moved to had its own laws and presented me with new challenges.
My need was having a place to enjoy a cigar where I could legally enjoy one. If there is no need for the product or service, you shouldn't start a business.
NOTE: If you wouldn't use your product, don't create it.
However, problems and needs are different and subjective. The problem could be as large as the lack of clean drinking water. Or, it could be as small as not finding a place to hangout out for a few hours.
Regardless, if you want to start a business, you need a problem to solve.
#2: A Product or Service that Eliminates the Problem or Satisfies the Need
Second, if you want to start a business, you need a product or service that make the problem go away.
There are three ways to be competitive in business. Lucky for us, you don't have to have all three to be successful.
3 Ways to Be Competitive
- Better: You can offer a product or service that is better than what your competitors have to offer.
- Faster: You can deliver your product or service faster than your competitors. People hate waiting, especially when they have a serious need.
- Cheaper: You can offer a product or service at a lower price point than your competition. However, a race to the lowest price is rarely one you want to win.
I recently considered offering a new subscription service as a (4th) business in my portfolio. To do my research, I purchased a competitor's product. When it arrived, I immediately knew I couldn't do any better, I couldn't figure out how I could be faster, and I knew I didn't want to be any cheaper. I shut that idea down.
If you want to start a business, you must have something to sell.
Finally, if you're going to start a business, there must be someone out there who is willing to spend money on your product or service. A lot of people might tell you “yes, I'll buy from you,” but few people will actually put their money where their mouth is.
If someone is already meeting the need you want to meet or solving the problem you want to solve, don’t be discouraged. Competition can provide validation that a market for your product or service exists. If you can be better, faster, or cheaper, you can steal market share and succeed as well.
Marketing is another story. If you're looking for tips on how to market your business, read this post.
If you want to start a business, you need customers to buy your product, and you need to know what they're already buying and why they're buying it. This free tool can help.
One More Thing to Keep In Mind
The most critical step is the first – starting.
One of the biggest reasons people fail is that they fail to get started. They don't start because they're afraid to look bad, make mistakes, or do things poorly before they can do them well.
Too many people (myself included), are afraid of mediocre performance, producing low-quality products, or creating less-than-stellar marketing material to promote their business.
The fear of making mistakes kills more businesses than bad products, bad accounting, or poor planning.
You will never get better at making products if you don't start.
My businesses have changed so many times that their current versions are unrecognizable from how they started. I changed CigarScore so many times in the first sixty days that I dreaded making more changes for fear of breaking something.
But growth pains are good, even if they hurt.
Regardless of how much thought, money, time, energy or effort you've put into starting your business, it's okay to pivot and move in a different direction. Nothing is permanent; everything can be fixed and improved.
So, get started!
To give you a quick recap, before you start a business, you need a problem to solve, a solution to that problem, and customers who will buy it. Ideally, those customers will have the need you're trying to meet. Your product or service must be better, faster, or cheaper than competitive products if you want to succeed. And, lastly, if you don't start, you can't finish.
Questions? Comments? Let me know in the comments below.