How to Become a Startup Entrepreneur?

How to become a startup entrepreneur?: The simplest answer is – work on an idea, build a company around it and sell it to private equity or other shareholders. This is the complete journey of a startup entrepreneur. There are many routes to becoming a startup entrepreneur. You can either do this as an independent founder, create your own company and take all the risks. The other route is to follow it within the confines of a company via intrapreneurship. This route however gives you lesser rewards, but the risks are also easier to manage since the personal risk factor reduces.

The number one step in becoming a startup entrepreneur is through your idea. Now, there are plenty of ideas in the market and most of them are rubbish. We can create a startup on any idea, but it all comes down to how a customer receives this idea. They will be the decision-makers on whether this can be a startup or not. The first step even in this process is to assess your idea and identify whether it is worth pursuing. Once you know it is worth your time, you can start creating a strategy for becoming an entrepreneur.

Who is a startup entrepreneur?

The standard definition of an entrepreneur is someone who takes risks and starts a business. This risk can be financial, opportunity, reputation etc based on the type of entrepreneurship. The bottom line is that a startup is inherently tied to risks. If you decide to take such a risk and work on your idea, then you are in the process of becoming an entrepreneur.

A startup entrepreneur is different from an entrepreneur. Entrepreneurship is about creating a business from an idea. A startup, however, is an idea that is built for scale. At its very inception, this idea is built to expand and create a compelling market demand. By the nature of it, such ideas are supported by investors, VCs and other startup funding routes which are willing to take risks for high returns.

How to become a startup entrepreneur?

In this section, we will talk about the 3 key points of becoming a startup entrepreneur. There are several other steps, but these three will give us as a good starting point in creating a business.

Define the business problem

As you’d have guessed, it all starts with an idea. Or better yet, it all starts with a problem. Once we know what the customer’s problem is, we need to assess the quality of this problem. While doing so, we ask the questions such as – is this a common problem that many people struggle with?

If this problem is persistent across many places, it gives us an opportunity for a scalable solution. Once we validate the problem, we need to think of the feasibility of an idea. This talks about whether you can solve the problem from the skillset at your disposal. A feasible idea not only has to give a chance of success but also must be different from other competitors in the market. You can’t differentiate by giving the same thing that others give as a solution. Unless you have this USP, the investors will not be interested in such an idea.

Customer Validation

An idea is great, but many people have ideas. Most of these ideas are good too. However, your main differentiator is in how to solve this idea profitably. This is where your customers can help. Once we have the idea, we need to validate it with the market. Of course, it is difficult to validate without having a solution. We can approach this problem by taking the MVP approach where we build the smallest version of a product to test in the market.

An MVP is not the same as a working product, but a cheap representation of what a product can look like. If we can create something representative, we can go out to the market and talk to people. Make sure these customer interviews are not biased and are objective. All we are looking for is validation of whether an idea is good or not. If the idea is bad, this intel is more valuable than pouring money into something we want to believe is good. Be as brutal and honest while doing this approach. It is better to get out of the race than to participate in a race in which you are doomed to fail.

Develop a business plan

This is the last precursor step I want to talk about today in becoming a startup entrepreneur. Once you have an idea, validate it with the market, it is time to work on it. But you’ll need funds to develop a product and start acting as a company. It is great if you have access to these funds. However, if you want to go via the startup funding route, the business plan is pivotal to starting this journey. A good business plan has all the main parameters such as product, market, USP and return on investor value.

The most important thing for an investor is to understand your vision, the passion behind the idea and the dedication to make it work. If with all these, it allows them to believe that they can be successful at something big, you have a chance at securing investment. And this is one of the biggest milestones in the early stages – to be able to get the funds to make your idea work. However, there are additional challenges after this step too, we will come to that in future posts. For now, these are the main steps in becoming a startup entrepreneur and I wish you the very best in this journey.