Startup City – Episode 3 – A few questions before starting a business

Hi I’m Ja Shia, and this is Startup City, a videolog which chronicles the story of me starting my small business, and as the title suggests I’m going to ask myself the questions that according to a few sources, all would be entrepreneurs should ask themselves before starting a business, and I’m going to answer them. To gather these questions I looked up 3 sources, which were available at the time of this recording, but you know how the internet changes so they might not be there anymore, and I tried to get some consensus among them. Though everyone says them differently, the questions appear to be:

Who are you?
What do you want to do?
Who are your customers?
Are there enough customers out there to sustain me?
How will I finance this business?

Each source has it’s own way of getting you to act on your business idea, but these questions seemed to be the linking characteristics, so I think it’s a good start to answer them, which is what I’m going to do right now.

Now, the first question some books tried to take this in a “who are you personally” kind of way, but I really appreciated the “how comfortable are you with risk,” approach. You can answer this question anyway you want, but starting a business is risky. I’m spending time and money on an idea that might not be sustaining. In fact, the odds are that it isn’t sustaining. Financially, I’m pretty conservative, and I don’t really spend money on luxuries, but I’m not really risk averse when it comes to my time. If I think something is important to me, I’ll go for it, and right now, this business is very important to me. I think my time is our most valuable asset, so the fact that I am willing to put it towards a new business, to me, says I’m risk averse, but let me know what you think on that.

What do I want to do? I’m reading this question as, what do I want to do, for money? I love telling stories, and I do this very well through video. I also have an understanding of what works and what doesn’t in digital marketing. This type of work makes me excited, I’m passionate about it, but I got to put it into business terms so: I want to sell marketing and video production services. to customers looking to extend their story and message to the web and digital markets. This will need some refinement, but for right now, that question is answered.

Who are your customers begs the gut reaction “everyone,” but then I read that if everyone is your market, than no one is your market. I’m going to think about this in terms of food: when I want a tasty burger, I go to a great burger joint. If I’m running a burger joint, my customers are people that want a tasty burger. Bringing that back to my business idea, my customers are looking for creatives, video producers, graphic designers, basically, geeks that speak, and can effectively deliver their story to others. Now that I have an idea of what they’re looking for, I can imagine that the next thing I need to do is find them, and tell them that I offer creatives, video producers, graphic designers, and geeks speak. I think that’s when marketing strategies come in works, but let me know what you think.

Are there enough customers to sustain you? I bet if this question were that easy to answer, there would be more successful businesses, but fewer people starting new businesses, because they would know if their ideas were viable or not. I also think that the presence of the question is probably just as important as the answer. They want to get us to start thinking about viability, is this real, or does it just sound nice? Since I’m pursuing an idea that is based in the professional service industry, I’m going to answer this in a separate video, but basically it involves segmenting the markets, and if you can make a pie chart, you can find out if enough customers exist in your market.

How will I finance this business? Anyway I can, within reason. I’ve heard some stories of people sleeping in their cars to save money to buy a house and fix it up, and respectfully, I’m not doing that. I’ve saved up enough that I feel comfortable taking on this risk, and I have found a few reasonable loan options through an SBA approved microlender, which I will see if we’re a right fit. However, if savings doesn’t cut it, then I will work until I’ve saved up enough money, and can act on a conservative financial plan.

All of these questions are leading ones, and their purpose appears to be leading me towards the idea that in order to be successful in business, you need to have a plan, and those questions are just the tip of the iceberg to get us to start thinking about business in a less abstract and more action based sort of way.

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