If you are one of those people who constantly dreams about opening a company and being your own boss, you probably want to make the jump and launch your startup. Your problem though, is that you do not know how to turn your idea into an actual business. This leads you to second-guess yourself, analyse your idea for profitability to no end and focus on generic ideas instead of practical solutions. This paralysis by analysis leads to procrastination. Eventually, your business may never become a reality.
If you are tired of your business remaining a daydream without actual execution of your idea, you need to start the process of developing your idea into a functioning business. You do this by creating a checklist of actions that need to be completed in order to get your business started. Creating a comprehensive checklist allows you to cover all of the steps that are needed to develop a successful business.
We have provided you with a checklist of 15 steps that will help you turn your idea into a successful business. This checklist is only for those who are serious about opening a Singapore company that has real potential to be successful. If you are one of them, continue reading for highly valuable information.
1. Research & choose your market
Before you invest any money and time into developing your business concept, you need to be sure that you are investing in an idea that has a real chance at succeeding. The way you learn this information is by researching the market you are planning on entering. You need to identify what are the current problems that are faced by customers in your market. You also need to identify the solutions that are being offered to satisfy their problems. This helps you get a better understanding of the marketplace you plan to enter so that you can create a product or service that is well received by your customers.
Many first time business owners make the mistake of building a business without doing market research. Therefore the business fails. You cannot just start a business without doing the necessary background research first. If you do so, you will be very frustrated that your business is not gaining any traction in the marketplace. No matter how hard you try to turn your struggling business around, your efforts will be useless because your business was not built to serve your market. Instead, you built your business according to untested principles and unverified projections of success.
Do not make the mistake of assuming you know what customers want. You need to know exactly what they want by asking them the right questions.
- Ask them what their problems are.
- Ask them how they feel about the solutions of current product or service providers.
- Ask them how the products or services could be improved.
- Ask them whether they would purchase your offering.
2. Select a Business Structure
When incorporating your business, you will need to select a legal business structure so that your business will be recognized as a legitimate business. The business structure you choose will have important implications on the following:
- Legal Identity
- Personal Liability for Business Debts
- Ownership – issues of transfer of your interest or equity in the business, ease of dissolution of the business, etc.
- Ease of Raising Capital
- Accounting – reporting obligations and standards
The Singapore business structures you can choose includes:
- Sole proprietorship - A Sole Proprietorship is the simplest form of business entity with only one owner who is the decisive authority and responsible for all assets and liabilities belonging to the business. You alone decide the direction the business takes. And when things go wrong, you are personally liable for the business’s debts without limit.
- Partnership - A Partnership is simply a case of several partners being responsible for the direction and liabilities of the business. One partner may be held liable for the mistakes of the other partners and be sued to recover outstanding money or other compensation from his or her personal property. There is no limit to the amount that may be recovered.
- Limited Partnership - A Limited Partnership consists of a General Partner and any number of Limited Partners. The General Partner is responsible to an unlimited degree, while the Limited Partner/s is responsible only to the extent the partnership agreement dictates.
- Limited Liability Partnership - A Limited Liability Partnership (LLP) is a perfect blend of a Partnership with a Private Limited Company setup. This type is highly suitable for individuals engaged in professional services such as lawyers, architects, accountants and management consultants. Each partner will be liable only to the extent of his her investment in the business.
- Private Limited Company - It is a locally incorporated company where the maximum number of shareholders is limited to 50. Such Private Limited Companies are usually required to have the suffix “Private Limited”, “Pte Ltd” or “Ltd” as part of the company name. Shareholders are not personally liable for the company’s debts, and the company has a legal identity of its own.
(Do Note: The description here is not exhaustive, and it is best to contact a company incorporation specialist or corporate service consultancy to decide on the best business structure for you)
3. Write a Business Plan
Your business plan is your blueprint of how your business will be developed and operated. You need to write a business plan which you can refer to whenever you need a reminder of your business’s vision, objectives, and goals. This makes you more accountable for your business success and your stated targets because your written documentation is a constant reminder that keeps you on track. That is if you actually hold your business plan in high regards. If you do not recognize the importance of your business plan, you will not put a lot of effort into writing a plan specific to the business you plan to start. Instead, you will just use generic information and pass it off as a business plan that represents your business. Do not do this.
A business plan is also needed for banks and raising capital through other avenues. These investors and financial institutions need to see that you have put serious thought into your business when they review your business plan. They will need to know who are the key people in your organization, how you plan to be successful, and your financial projections. If this information is sparse or not backed up with evidence, you can forget about getting any outside investment. Therefore, you must take your business plan seriously if one of your objectives is to receive funding for development and operations.
The sections that must be in your business plan include:
- Executive summary - a concise overview of your business plan.
- Company description - the explanation of who you are, how you operate, and what your goals are.
- Products/ services - a description of what you are selling, while focusing on customer benefits.
- Market analysis - your insight about target customers, industry, and competitors.
- Strategy and implementation - summary of sales, marketing and operations strategies and plans.
- Organization and management team - an outline of your company’s organizational structure.
- Financial plan and projections - an in-depth analysis of how much money your business will make
4. Design and develop your minimum viable product
It is never a good idea to create a product without gathering the necessary feedback to validate your product in the marketplace. You will be very frustrated if you create a product that does not have a demand in the marketplace. Now you have wasted time and money on developing a product that will not be purchased by your target market.
You need to get your product into the marketplace as quickly as possible so that you can gain valuable information from your customers. You need to learn what features they like and what they do not like. You need to learn the value they place upon your product, which will let you know the amount of money they will pay for your product. When you learn this information, you can work to improve your product so that it has a chance at succeeding in the marketplace.
The goal is always to make as many tweaks and pivots as possible to your product or service in the early stages of your startup with limited funding. It is only when you have latched on to a winning idea, product or service and know exactly how to bring it to market and sell it that you should commit substantial funds to the manufacture of a product or delivery of services. When you know that your product is validated by the feedback you gain from the market, you will be more confident spending more on the product or service. So will potential investors.
5. Protect your intellectual property
If you do not protect your new technology, idea, innovative way of delivering a service or trade secrets, even the contents of an original book you have written, you are taking a huge risk of losing money as a result. Other people can profit off your ideas if you do not have the adequate protection that keeps this from happening. What makes this situation even worse is that you cannot do anything to act against those using your intellectual property because you do not have the documentation proving you completely own the said assets.
This is why you need to protect your intellectual property by purchasing the protection that is recognized by the courts and your competitors. If anyone is caught using your intellectual property without your permission, they will have to pay you for infringing upon your protected assets. Therefore, you need to be sure that you protect your intellectual property to have this enforced protection. These protections include:
- Patent - is a set of exclusive rights granted to an inventor for a limited period of time in exchange for detailed public disclosure of an invention.
- Trademark - a symbol, word, or words legally registered by use as representing a company or product.
- Copyright - the exclusive right to make copies, license, and otherwise exploit a literary, musical, or artistic work, whether printed, audio, or video.
- Domain name - the part of a network address that identifies it as belonging to a particular domain.
If your startup is highly innovative and you have certain business processes, products or services to protect from intellectual property infringement, you may download the complete guide here.
6. Find a co-founder or partner
You cannot do everything on your own -- no matter how much you believe in yourself. You will need help to make your business successful, and the best help you can receive is someone who is as invested in your business as you are. Many successful businesses are ones that are operated by two co-founders or partners. These are people who assume the risk of building a business together. Therefore, the entire burden does not just fall on your shoulders.
You need a partner whose strengths complement your weaknesses and vice versa. This allows your business to develop quickly because there are two or more people who are all focusing on different areas of the business. You are now getting more done as a result.
You will want to do background research on your potential partner before bringing them on. The vetting process should look into people they have worked with, proof of their abilities, and their commitment to hard work. Bringing in the wrong partner will be a bigger headache than working alone.
7. Find a mentor or community
Starting a business is a very tough process; there are so many working factors that go into building a business that is both sustainable and successful. Even though you are responsible for getting this work done, you will still need support to help you get through the challenges of building your business. You will not know everything, so you will need people in your network who you can seek for feedback and counsel.
Finding a mentor is great because they have the knowledge and experience of building a successful business. They can provide you with valuable insight on how to handle different situations that may occur when building your business. Mentors can also introduce you to important people who can help move your business to the next level. Some mentors are willing to go through great lengths to make your business a success and share of their expertise and business contacts for a small equity stake in your company as low as 1% or 2%. Consider this option seriously.
You should also join a community of entrepreneurs. These are people who are going through the same process you are experiencing. This provides you with great support because they understand the challenges of entrepreneurship, unlike your family and friends. You can bounce ideas off of those in your community and be given motivation to work harder.
8. Choose your funding type
You will need to fund your business somehow. It will not grow with hope alone. You will need to decide how you will fund your business and if your funding source will provide you with the adequate capital to build your business.
Many first time business owners choose to fund their business through bootstrapping. This is you injecting your own personal funds into your business. The reward if this works out is you reap the full rewards of your business being successful. The risk you are taking is a failed business and losing your personal assets, which could mean a serious setback in your personal life.
Crowdfunding is a new source of funding many entrepreneurs are pursuing. You go online and present your business idea, and ask for donations from those who support your idea. In return for their donations, you offer your supporters an incentive for their investment. This type of funding can help you get your business funded quickly, but you have a lot of people to pay back once you start to make money.
Getting a loan from a bank is the traditional source of funding a business, but one of the most difficult choices. Banks will put you through a strenuous process to prove that your business is loan-worthy. It is frustrating when you go through this process and are denied a loan. That is time wasted. If you do receive a loan, you will have to put your personal assets up as collateral since your new business has no assets or cash flow.
9. Research compatible investors
If you choose to go the route of finding an investor, you will need to find someone who you believe you can work with long-term. An investor is not only injecting capital into your business, they also need to be a source of advice and strategy. Investors should also introduce you to other people who can help to position your business within the marketplace. You need an investor on your team who truly cares about the development and success of your business.
10. Create your pitch deck
You need to create a presentation that sells the value of your products or services to investors. Many entrepreneurs make the mistake of ‘telling’ their business instead of selling their business. You need to effectively communicate the problem that your business solves and why customers will feel compelled to purchase your offering. Presenting this information will make investors feel confident that you have done your homework and they will be excited to invest into your business. The best way to provide structure to your business proposal and your presentation is through a well-prepared pitch deck. Let the visuals speak for you, and never forget that a well-designed chart or infographic may clinch the deal for you.
11. Make it official
Your Singapore business will be required to be registered or incorporated with ACRA in order to be recognized as a real business. When your business is officially registered with ACRA, you will receive a UEN (Unique Entity Number). It is the equivalent of your NRIC number, giving you the formal identity and rights operate as a business. In addition, after incorporating or registering your business, you are now responsible to ACRA and other governmental bodies for various obligations ranging from accounting to tax. But it’s not all about obligations. For startups especially, there is a wealth of startup funding assistance offered by Spring Singapore and even JTC.
12. Build a great team
You need a team of people who will help you build a great business that is successful in the marketplace. Hire only those people who believe in the vision of your business and who possess the skillsets you need to move your business forward. Your employees are the ones who will interact frequently with your customers, be a representation of your business and carry out the daily tasks crucial to your business. Therefore, you should hire only those people who are focused on providing great value to your customers and believe in the values, mission and the direction in which you are taking the business. One bad employee can do serious damage to your business’s reputation. You prevent this from occurring by hiring only the best and creating a culture where your employees can thrive.
13. Find an office
As a new business, you may need to work out of your home initially due to a lack of capital to support the cost of an office space. If you have some money to spend, you should consider renting an office in a co-working space. You are getting an open office space for a great rate and you are surrounded by other hard working entrepreneurs, which motivates you to work hard.
Once your business starts to grow, you should look into officially getting your own office. This helps to establish a professional image and hire employees to work in-house. Only get office space if it is needed. Many successful businesses today are being run online, with employees working from remote locations.
14. Establish your brand
You need to differentiate your business from your competition by establishing a great brand. Your brand is what you stand for, the value you provide to your customers, and the quality of your products and services. You need to effectively communicate your brand message through great marketing campaigns. This can be via both online and offline marketing ranging from product launches, advertising, direct mail, to marketing on social media platforms.Your brand will help your business stand out from the competition because consumers immediately recognize you due to the great presence you have built up.
Make your brand memorable, unique, sincere and professional, telling your target market exactly how you will solve their problems or fulfil their wants and what makes you special as compared to your competitors.
15. Research and create detailed customer personas
You need to know exactly who your preferred customers are. This means knowing their age range, their income, their lifestyle, and why they purchase your product or service. This information about your customers is very valuable because it helps you market and sell correctly to your customer base. This allows you to make more sales and gain more market share from your competition.