How To Turn A Business Idea Into A Viable Startup

Ikenna Nwachukwu

3 years ago

You have an idea that could become the world’s next big thing. It’s a solution that will fix a real-world problem for countless people, and become highly valued while doing so.

Read more about How To

There’s true potential in it. If only you could bring this idea to life as a startup. Even for the most straightforward concepts, it’s hard to go from ideation to a solid, thriving venture. There’s a lot that could happen on the way, including a realization that your world-saving idea isn’t all that you’ve dreamt it to be. But if you’re convinced that it has a strong chance of becoming a valuable startup, we’ll show you how to build it.

From Idea To Startup: Steps You Should Take

Here are the steps you should take to make your idea a successful business.

Decide What Problem You Want To Solve

Businesses and startups that make an impact all start out trying to do one thing: solve a real-world problem. This ‘problem’ may be something that’s bugged a lot of people for a long time. Or it could even be that an existing solution isn’t solving a problem well enough. Or, perhaps, a large segment of the population is underserved. Shaving sticks solve the problem of an uncut beard. Smartphones solve the problem of communication and limited access to global knowledge bases. If your idea solves an obvious problem, you may have a good startup somewhere down the road.

Research The Market

You know that you have a solution. But who needs it? If your product (whatever it is) will generate revenues (and profit), it has to be desired by a large number of people who will value the solution you’re offering them. You have to know who you’re going to sell to. Know what regions they live in, their average age, income levels, cultural affinities, and aspirations. Create a clear description of this class of people, and find out the channels through which you can reach them. If there are preexisting products in the niche you plan to get into, learn how their current customers feel about their service. Also, examine the market for signs of saturation, underserved populations, or inefficiencies. The first may indicate that it’s not a market worth getting into. The latter two may point to opportunities you can exploit.

Create a Financial Plan Or Forecast

How much money do you need to spend on this idea to make it work?

Sign up to the Connect Nigeria daily newsletter

A financial forecast for the early days of your startup could answer this question. You can create one by:

Making a list of all the resources you’ll need to launch the startup and drive it to demonstrable viability.
Attaching costs to each item.
Creating hypothetical financial statements based on them.

When you do this, be sure to include a decent margin of error, so you’re not caught off guard if values change when the time comes to acquire those resources. Another thing you should do is design a revenue model. You expect this startup to turn in money soon enough. What revenue sources do you have in mind? And, how soon until you break even?

Find Out How You’ll Raise Capital

Some startup founders choose to bootstrap the first few months and years with money they’ve saved up. Others raise funds from family. A few are able to secure financing from formal investors. However, most formal investors will only stake their money on a business that already shows promise of significant growth. You can seek financial backing from less formal sources first and go for formal institutional funding (loans, equity financing, etc) after you’ve built something that works, even on a small scale.

Create A Minimum Viable Product

A Minimum Viable Product (MVP) is a version of your product that has just the features it needs to solve your customer’s problem, and not much else. The point of making an MVP is that you want to test it out in the market, to obtain useful feedback from users. You may then refine the product based on the feedback you collect, removing, adding, and modifying various features. Find out more from our article, How To Build A Minimum Viable Product That Works.

Iterate To Success

The process of building startups continues well beyond the market’s acceptance of its product. Startup teams should aim to refine their offering and bring it closer to perfection. Feedback, team reviews, and market performance are sources of insights they should draw from.

Final Words

Fashioning a startup from a mere idea is no easy feat. But it’s possible; at least the many successful ventures in our world today attest to this fact. Hopefully, you’ll follow the steps we’ve provided here to create a truly special startup. Featured Image Source: Thrive Global

Got a suggestion? Contact us: editor@connectnigeria.com