Cash-strapped ... “Don’t waste hours and money because you think you have the idea of the century”. Photo: Tanya Lake
Launching a start-up is easier than ever. But, because entry barriers verge on non-existent and everyone wants to be the next Facebook, Twitter or Dropbox, competition is fierce.
The intensity raises the question of how you stand out, especially if you lack clout or capital. A new business guide by Bloomberg business wiz Jason Baptiste, The Ultralight Startup, shows that you do not need an MBA, a trust fund, or even experience running your own firm to become a tech world star.
One of Baptiste’s success tips is that you should build a product you need - Foursquare founder Dennis Crowley built an early model of his product because he wanted to keep in touch with ex-colleagues.
Another point that Baptiste makes is that your offering need not be sexy - Dropbox hit the spot because it offered a neat solution to a boring problem, online storage, Baptiste says.
Baptiste also advises you to promote yourself boldly - online payment service WePay exploited frustration with industry leader PayPal by dumping a cunningly inscribed block of ice in front of a developer conference.
Three Aussie business experts shed more light on how you can make an impact, irrespective of marketing muscle.
Five secrets of an ultra-light start-up
1. Weigh up whether you even need bother developing a product or service, says business coach Fabrice Beillard.
After all, you can buy readymade products such as ebooks for $5 each then sell them on eBay, say.
Or, venturing into affiliate marketing, you could consider the hundreds of firms that stock good products that they do not know how to sell. Most businesses - even multinationals - welcome the free advertising and additional customers generated by affiliate marketing.
Contact a firm offering services that catch your interest. The firm may already have an established affiliate policy. If not, that means less competition for you.
“Just call!” Beillard says.
Alternatively, he advises, assess the re-sellable products offered by an affiliate programme megastore such as ClickBank or Commission Junction. Ensure that any network you join offers good service and will be there tomorrow to pay your commissions.
2. Road-test your idea.
“Don’t waste hours and money because you think you have the idea of the century,” Beillard says.
That common sense tip is worth a million dollars, Beillard adds, because many wannabe online entrepreneurs squander cash on untested, unfeasible ideas.
Use Google’s keyword tool to gauge the size of the market and competition - confirm whether you are really hitting the “sweet spot”, he says.
Then, he says, “track, measure, improve”.
3. Deploy free software, suggests the director of the outsourcing firm Half Price Staff, Amanda Horsburgh.
Horsburgh’s website was and remains “the most basic site”, which she built with Google Sites, using the standard free template.
“I have zero IT experience and no IT skill, but I refuse to change it,” says the bootstrapping entrepreneur. “It works,” she says. “It's free. It makes my IT guys cringe - they beg me to let them fix it up,”
she says, repeating that she refuses because clients just care about the services she offers, not the design of her site that she dubs an “electronic brochure”.
Besides Google Sites and “the whole Google offering” including Gmail and Google Docs, Horsburgh recommends the internet telephone service, Skype – “a given for communication”. Three other tools she highlights are the recording app Audacity, the mail-out app Mail Chimp and the task management app Asana.
4. Understand that the size of your marketing budget counts less than the size of your idea, says business coach Lisa Ormenyessy. So, Ormenyessy says, ensure that your idea solves a problem and that your pitch is compelling.
Many start-ups are “me-too” clones, she says, critical of standard social media marketing chatter. Ensure that your message cuts through it, she says.
5. Be consistent, Ormenyessy says.
Many wannabe entrepreneurs have “bright shiny object syndrome”. They latch onto an idea and talk it up.
Then, just when it is set to gain leverage, they get bored and move onto the next idea, message or strategy. “Constant and consistent wins the marketing race,” she says.