May 10
9
Understanding How To Get A New Business Started
There are a lot of things to consider when starting a new business. And it is just as challenging to build an existing one.
The big problem is that you have to do so many things yourself. And there just aren't enough hours.
Last night I was at a dinner party and saw an old friend who is trying to crank up his business to the next stage. He was telling me about the problems he was having with growth. He has a film production company and has the problem of dealing with the success that comes from constantly doing business development which finally turns into a lot of potential clients coming on stream at the same time.
He was concerned about how to maintain business development activity while he goes on the road and is producing content for his clients.
I asked him how much business his web site was bringing in. The answer was not very much. Turns out his web site only has a hundred or so visits each month, even with buying google ad words.
I suggested to him that he needed to create a blog, and then needed to generate metadata that would ensure that there was high visibility for his blog. He told me that he doesn't have the time. And that not enough real business comes from the web site to require him to do the work.
So there you have the dilemma not only of the start up but of the mainstream business – a website that delivers a basic due diligence functionality for customers but doesn't actually deliver and business – and, as a result, doesn't warrant any time or resources invested in it.
What is tragic about this is that anyone who has not understood the relevance and the value of the web by now is clearly not going to survive.
If you want to build value in a business, you have to have not just a web presence, but an active role on line that is delivering new information for your potential customers. You have to not only provide them with the basic due diligence information that they require – you need to also give them enough information to come to the conclusion that you are actually one of the fundamental information resources for the field of activity that you are part of.
This takes time and effort and may be a chore.
But you have to make a commitment to it.
There are a lot of things that a new business needs to get started, and more particularly, to get investors interested. And it is investors that you need if you are to have enough working capital to be able to expand. Yes, it reduces your equity stake in the business. But it also ensures that you have other people that are sharing the risk with you, and who have a vested interest in making your business successful.
So do your best to get investors.
I had no idea of the fact that dilution of the asset was less important than having multiple shareholders when I first tried to raise money. Getting other to realise that they can share in the upside is the bottom line…