By some accounts, I’m a serial entrepreneur. I launched a dating website in my first year at university back in 2000. And have continued ever since, iterating across 5 different verticals. I made mistakes along the way, but perhaps more importantly, learned from them.
I’m the founder of TrustedBrokers.com, a comparison service with over 25,000 monthly active users. TrustedBrokers.com compares brokers down to the account level, helping users find the best online trading account for them.
I’ve put pen to paper to share 5 tips I would give to my younger self, with the benefit of hindsight.
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1. Solve a problem…
Consumers don’t want to buy your product or service. They’re actually looking to meet a need. Abraham Maslow’s “Hierarchy of Needs” is one of the best-known theories of human motivation. He makes the case that humans are first compelled to satisfy physiological needs, such as food, warmth, and rest, before pursuing others.
Higher needs include, in order of diminishing importance, social belonging needs, esteem needs, and finally self-actualization needs. For example, a dating service could help people fulfill social belonging needs of love and intimacy. A luxury product or getaway could help meet the needs for status and attention.
2. Where you have a competitive edge
Customers will only part with their hard-earned cash if your product or service answers a genuine need. So focus your creativity on finding a need that’s either unmet or only partially met by your competition. This brings us to the product and the price is two of the “4 Ps of marketing”, alongside promotion and place.
Some companies innovate in ways that meet a yet unmet need and open up a whole new market to themselves. Airbnb created a platform where anyone could rent a home, or make their home available for short-term stays. Netflix brought a content streaming platform to the masses and snuffed the video rental industry in the process.
Others, like Google, outperformed their competition by delivering a superior product. In the early days of the Internet, traditional search engines like Yahoo! and Altavista relied on human-edited lists of websites. Google reinvented search by using algorithms, rather than human intervention, to rank search engine results. The simplicity of its service and the quality of its results caught users’ attention, and Google quickly came to dominate search.
3. With an addressable market
You’ll also need to estimate how big a market there is for your product or service. This is an important step no matter how big or small you ultimately hope to grow your venture.
You could follow a top-down or a bottom-up approach, as most management consultancies do. A top-down approach, which considers demographics and other macro factors, could be better suited to a product or service with national or global ambitions. Conversely, a bottom-up approach could be better suited to one with local aspirations.
You could also turn to keyword research tools to estimate the size of your addressable market. For example, you could turn to Google Trends to see how searches for a given keyword have changed over time country by country. Or you could use the AdWords Keyword Tool to source monthly search volumes in a country or local area.
I once had an idea for a “missed connections” service based on a mobile app. Imagine you saw someone you fancied on your commute to work, but hadn’t approached them at the time. My app would let you pin a message on a map, in the hope that your match would get back in touch. This was a neat idea, but one that no one was searching for online, which made it incredibly hard to promote.
4. Know how to promote your product or service
You need not have a detailed marketing plan ready from the outset. But it’s important that you have a marketing strategy in mind. This means clarity over how you could raise awareness about your product or service, in the weeks leading up to launch, and thereafter.
You could turn to traditional media, through press releases or media contacts, to let the world know about your venture. This can be expensive, and will only provide a short-lived burst of traffic, but could be worthwhile if your brand is truly innovative. I once released a machine learning algorithm designed to recognize websites hosting radical content. Within hours of the press release going live, I was on the phone with American and British journalists.
But the Internet offers a wealth of marketing avenues superior to what traditional media can offer. Savvy Internet marketers will optimize their websites to appear high in Google’s search results. Others will turn to social media to spread the word about their brand through viral videos. And if you’re in a hurry and have a budget, you could run an advertising campaign on Google, Bing, or Meta Platforms.
I also wanted to draw your attention to word-of-mouth advertising. According to a study published by Nielsen, 92% of people trust word-of-mouth referrals from those they know, above all other forms of advertising. People will spontaneously recommend your product or service to friends and family if they enjoy it. But, you could nudge them in this direction through a carefully crafted referral program.
5. Bootstrap your business from the start
Launching a business is hard work, with no guarantee of success. So plan carefully and make sure you don’t overstretch yourself financially. If this venture fails, you want to be in a position where you can pick yourself up, and work toward the next opportunity.
Start small, without degrading your product or service’s promise. This means growing incrementally and launching a minimal viable product (MVP) as soon as possible. This will allow you to gather valuable customer feedback early on in your journey, and make incremental changes along the way, or even pivot if you realize you’re going down a dead-end.
I would also recommend bootstrapping your business early on. This means aiming to break even within months of going live. If you can’t generate a profit early on, it’s unlikely that you ever will. This may not happen overnight if you have high fixed costs and need large sales volumes to bring down unit costs. But you should have a clear timeframe for achieving profitability, and a plan B if this fails.
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Tenacity and self-belief are one of the keys to success. They will keep you going when your web design agency walks out on you, your first advertising campaign falls flat and even your friends and family start questioning your venture. Don’t let these initial setbacks temper your enthusiasm, and perhaps most importantly, give yourself time to succeed.