Starting a company will become easier if you remember these tips

The Modi government has kickstarted 2016 with its comprehensive startup-friendly policies to help boost the startup ecosystem in the country. And we do have young entrepreneurs mushrooming across the country. While ideation, execution and sustainability are the basic mantras for a start-up, it is the nitty-gritty involved in these stages of a new company, which makes a start-up a roaring success.

BI India lists down the basic factors that come into play when one thinks of starting a new venture.

Founding and management team

People are the biggest asset of any company. And when the company is new, the right kind of leadership is extremely essential.

“Many experts believe that two people in the founding team are considered ideal as with increasing number of founders, the company’s value is shared accordingly. However, what is really important to be mentioned is that more than the number, it is critical for the founder of the company to carefully choose the right mix of co- founders with him/her who bring in the right expertise and culture to the table. Founders need to realize their strengths and weakness,” said Utkarsh Joshi, principal at the HR Fund.

Valuation and funding

Companies progress and fail at various stages of funding, reflecting on their valuations. Though it varies from one industry to another, increase in valuation is an important milestone to be worthy for next round of funding. However, it is also required to mention the risks of blowing up the valuation too much, which leads to a potential investor/VC shying away at times and making it difficult to go for the future round of funding.

Choosing right investors

Every new entrepreneur needs guidance and the right investor provides exactly that. An investor with the requisite background, industry expertise or specialization in business ventures offers advice, inputs and guidance based on their experience with various companies they work with. Or they could be because they were successful entrepreneurs themselves.

Besides, when prominent people from the industry associate themselves with a start-up, not just the valuation of the company but also its business grows by leaps and bounds. And then, there’s no stopping!

Customer acquisition

The cost of acquiring the customer should be lesser than the lifetime value of the customer. Judging the market right in terms of need for the product, its usefulness, timing, market size, and pricing leads to consistent and successful customer acquisition, as these are all cohesive factors. Rather than various marketing gimmicks – a well-defined process that leads to scalable ways to acquire the customers and thereafter monetize them at a higher level than the cost of acquisition is the solution. PR also plays an important role in the same.