The recipe for entrepreneurial success isn’t a secret: you need to have a strong work ethic, a certain amount of persistence, and a good business model. Relying on these these three components alone, however, isn’t going to create a sustained push toward success. Entrepreneurs need to have more.
They need to have a solid investment strategy.
As an entrepreneur, you’ve got a certain cap on the cash that you can spend as you create your business. The types of investments you make can either enhance your recipe or cause it to fail. Here are the first 5 places you should consider putting your cash as you get started.
1. Competitive Analysis
You can’t operate within a vacuum as a business. You need to know what your competitors are doing if you’re going to be successful. This is an ongoing process that never stops. What are the strengths of the competition? What are their weaknesses? Understanding the competition provides personal insights you wouldn’t receive otherwise.
Hiring a third-party to provide your competitive analysis eliminates the personal bias that creeps in when you do the work yourself. You can certainly run surveys, questionnaires, and polls on your own if the budget is tight, but having an honest picture of what is going on within your niche will help you craft a path to your vision that has fewer obstacles along the way.
The greatest idea that the world has ever known will never sell if no one is aware that it even exists. There are no magical solutions that will carry word of a great product to every customer segment. You must target each segment, inform them of what you’ve got, and then create a buzz of excitement around that product.
This means you need to create publicity. You must engage your customer base. Social media is a great place to get started to help begin building your visibility. Online advertising through sites like Facebook or Twitter can give you a head start. Once you start creating brand ambassadors, you’ll have started an avalanche that will hopefully never stop.
3. Good People
Many entrepreneurs feel like they need to carve out their own path by themselves. Sometimes these entrepreneurs find a great amount of success in doing so. A more common outcome is a path that leads to loneliness and failure. Investing into good people who will become long-term employees will build a strong foundation that can always be built upon.
Spending money on the nurturing process for these people will retain them. Give them feedback to let them know how much you appreciate them. Encourage your people to never stop learning and then set the example for them by doing the same thing. Your desire to succeed can be contagious, but only if you’ve invested into good people who support your vision.
The fastest way to fall behind as an entrepreneur is to be using outdated technology. You need to always be focused on the user experience. This means having high-speed internet, modern computing technology, faster payment platforms, and plenty of apps that can help you do more with less time. These internal investments can add up quickly, so take notes from your competitive analysis to discover your weaknesses and use technology to shore them up.
Your network is going to be the key to your success. Investing into it means building a community of angel investors, other startup founders, and key entrepreneurs who have already been where you currently are. Exchanging information freely within this community can generate creative ideas you would have never thought about on your own.
Networking can also be a key source of capital. Even if you don’t have angel investors beating down your door to give you money, a strong network can become a source of cash through crowdfunding and other investment outlets.
Your cash needs to maximize your value. These 5 points of emphasis are a good place to get started, but it is also important to remember that the job is never really complete. If you do experience success, then it becomes necessary to invest into other startups to keep the momentum going. Entrepreneurs may be pursuing their own interests, but when the community succeeds, they also succeed. No one can survive for long when they’re being their own island.
When this happens, you keep up with modern business strategies. This lets your business stay viable for each targeted customer segment for years to come.
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