Successful Online Start-Ups For Dummies Cheat Sheet (Australian Edition)
Creating a successful online business takes more than just a great idea. In this Cheat Sheet you’ll discover some real gems of advice to help you get investors on side from the get-go; save some cash along your start-up journey; and tips on what to do to really stick with it for the long haul.
Three Things Investors Look for in Online Start-Ups
When screening new online business start-up ideas, investors generally make a call whether or not to invite you in based on these three key factors:
Your revenue and users: Most investors are pretty bad at spotting trends before they become mainstream, so chances are they may not ‘get’ your idea at first. Don’t try to explain why your idea is great, instead show them some data. If you can show $1k revenue on your first day of trading or a staggering user growth rate (several 100 per cent), it doesn’t matter whether investors get your idea or not — the data is showing them exactly what they want to know.
Your target market: It’s simple. You need to target a multi-billion dollar market. Alternatively, if you’re opening a new market, demonstrate how it can grow to be worth more than a billion dollars. Investors will not look twice at you otherwise!
Your team: Make sure you have a good mix of skills and expertise in your team. All team members should be over-achievers in their various specialties. If any of you have a track record of previous start-up successes or failures, point these out in CVs or Profiles as part of your pitch.
Keep Online Business Communications Brief for Best Impressions
Adopt this great time- and money-saving tip as a mindset for all facets of your online business start-up: Be brief. Brevity should become your mantra for all that you do, because nobody has time these days — your users, your customers, your staff and certainly not your investors. This means you have to put in the hard work so that whatever you communicate can be instantly understood.
Have you ever heard the following saying, ‘I’m sorry I wrote you such a long letter; I didn’t have time to write a short one.”? This quote sums up many situations of start-up teams that develop software requiring pages and pages of instruction manuals: They submit more than 100 pages of a business plan that is mostly filled with made-up stuff, and prepare investment pitches that last for 90 minutes.
The reality is that no-one uses software or websites anymore that are not immediately intuitive and usable. Nobody reads documents that are more than 20 pages (even if they say they do, they just skim over most of the content). In most investor meetings you will get about 3–5 minutes of their time between them checking e-mails on their smartphones.
Be brief and make an impression in 3 minutes or less. Do the hard work upfront so you can get your point across straightaway.
Make ‘Never, Ever Give Up’ Your Online Business Mantra
Yes, this does sound like a cheesy song from the 80s, but the message is really important. There are really only two types of online entrepreneurs: Those who keep trying to get a business off the ground until the day they die, and everyone else.
The decision to ‘make it or die trying’ is also the only thing that separates successful entrepreneurs from the great unwashed. However, a common misconception is to interpret this to mean you should never give up trying to make a particular idea successful. That’s unlikely to work. The art of successful online start-ups is typically knowing when to persevere, when to change course and when to abandon an idea to work on the next venture.
The most important technique to implement on your journey is to keep trying: Never, ever give up ‘entrepreneurship’. Most entrepreneurs go through a serious of unsuccessful ideas and ventures before they finally hit the jackpot with an idea that gets traction and allows them to fulfill their start-up vision.
So keep trying to make a number of ideas/companies successful — if one doesn’t work out, learn your lesson and move on to the next.