How to Build a Startup
Have you ever dreamed of starting your own business? Do you envision yourself creating a product or service from scratch, being your own boss, and building a career path that aligns with your values and passions? Becoming a business owner can open the door to not only financial independence but also personal freedom and a deep sense of purpose. You’ll develop new skills, expand your professional network, and discover strengths you didn’t know you had. It’s a journey filled not only with challenges and setbacks but also with life-changing opportunities.
Turning a startup idea into a thriving business requires commitment, strategic planning, and a clear understanding of the potential risks and rewards. Keep reading to discover what it takes to build a successful startup and explore the essential steps you can take to transform your concept into reality.
Define Your Business’s Identity
While many startups eventually become thriving businesses, studies show that approximately 90% of startups fail. To ensure that your company is among the 10% that succeed, your product or service must address a real-world problem. The process of launching a startup begins with clarifying your business idea and identifying the market demand it satisfies. You’ll need to identify a viable product or service that offers something of value in order to attract and retain customers.
Once you’ve determined the benefits your business offers, you will need to choose a legal business structure such as a sole proprietorship, limited liability company (LLC), or corporation. Each structure has different legal and financial implications. The simplest business entity for early-stage startups is typically a sole proprietorship, but an LLC may be more appropriate if you have a business partner or plan to hire employees. Since every situation is different, you may want to consult with a business law attorney or tax professional to determine which business entity meets your needs.
Write Your Business Plan
A well-crafted business plan is crucial for transforming your startup idea into a thriving business. The plan should include the following elements:
Company overview: Define your company’s mission, vision, and core values. Describe how your business is structured and outline the organizational hierarchy and key leaders.
Business purpose: Identify the problem or market gap that your business addresses and describe the product-market fit, meaning how your product or service aligns with current customer demands.
Market research: Describe your target audience, including their demographics, preferences, and behaviors. Consider developing buyer personas to better understand the target audience and guide marketing efforts.
Products and services: Describe the products or services your company offers, including their features, benefits, and unique selling points.
Industry and market analysis: Outline the current market and anticipated demand.
Competitive analysis: Evaluate your key competitors’ strengths, weaknesses, and strategies.
Marketing and sales plan: Explain your marketing strategies and pricing models.
Financial overview: List your initial investment costs, funding needs, fiscal goals and milestones, and financial projections.
The U.S. Small Business Administration provides a range of useful resources for aspiring entrepreneurs, including business plan templates and examples.
Consider Your Funding Needs
Securing funding is a crucial step in the early stage of a startup. Begin by estimating how much capital you’ll need to build products, hire staff, promote your business, and cover operational costs. Once you understand your funding needs, begin brainstorming potential sources of capital. Many entrepreneurs raise money through angel investors, meaning high-net-worth individuals who provide funds in exchange for ownership equity. You may also be able to secure capital from friends and family members, small business grants, bank loans, or startup accelerator programs such as Y Combinator.
If your startup has a high growth potential, you may also be able to secure funding through venture capital firms. Another option is to utilize crowdfunding platforms such as Kickstarter to raise awareness about your brand and obtain financial support. Crowdfunding is usually most effective when a startup sells consumer-facing products that can be easily explained and demonstrated. As you begin to accumulate capital, make sure to keep financial documents organized and open a dedicated bank account for your business so you can keep personal and business funds separate.
Find Supportive People and Resources
Establishing a startup is exciting, but it's also likely to be one of the hardest things you’ve ever done. Finding the right support can help you avoid common pitfalls and move forward with clarity and confidence. Advisors and mentors who have already navigated this process can provide invaluable guidance and feedback on financial strategies, funding sources, marketing plans, and other key aspects of business ownership.
Consider joining local networking groups where you can connect with other business owners, ask questions, and share ideas. There are also many online resources for entrepreneurs. SCORE, a nonprofit supported by the U.S. Small Business Administration (SBA), offers mentorship opportunities, guides, templates, financial tools, webinars, and online courses that can support you in your journey. The SBA also funds Small Business Development Centers that provide counseling and assistance regarding business planning, strategy, financial management, and funding. The U.S. Chamber of Commerce also offers a wealth of resources for new business owners, including informative articles, events, and toolkits that can help you manage the day-to-day challenges of running a business.
Invest in Your Future by Earning a Business Degree from WGU
From identifying the target market to choosing the right business structure, launching a startup is a complex and challenging process that demands specialized knowledge and skills. If you’re passionate about business ownership, a business degree from WGU can equip you with the competencies you need to thrive. WGU’s B.S. in Business Management degree program integrates insights from industry leaders and business experts to ensure the program teaches you essential skills for launching, managing, and scaling your own business. WGU also offers several master’s degrees that can expand your skill set, including a Master of Business Administration and a Master of Science in Management and Leadership.
Wherever you are on your entrepreneurial journey, WGU has a degree program to meet your needs. WGU’s online, flexible format allows you to take courses from anywhere, anytime, meaning you can earn a degree without sacrificing your personal or professional obligations. Our degree programs follow a competency-based approach, which means you can pass courses by proving what you know, enabling you to accelerate your progress and graduate faster. Take the next step by applying today.