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What Every Entrepreneur Should Do Before Launching a Startup – ReadWrite

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What Every Entrepreneur Should Do Before Launching a Startup - ReadWrite


Launching a startup is always exciting. This is your opportunity to accumulate wealth, make a name for yourself, innovate in some unique way, and possibly leave behind a legacy. But too many entrepreneurs end up failing because they were inadequately prepared.

Before you even consider launching a startup, there are many preparatory steps you’ll need to take.

Set the Right Expectations

Before you do anything, you need to set the right expectations. A combination of media attention and survivorship bias has led people to believe that launching a startup is a surefire path to success – and maybe even a path to becoming a billionaire.

Being overoptimistic can cause you to overlook important weaknesses and threats and be disappointed and frustrated when things don’t go your way.

Consider:

  • While it’s easier to start a business today than it was, say, 30 years ago, there are still prohibitive costs to keep in mind. Depending on the nature of your startup, you may be responsible for paying for licensing, an office, employees, technological infrastructure, marketing, and more. If you’re not prepared, these costs could completely overwhelm your budget and make it nearly impossible to recover.
  • Failure rates. Some businesses explode in growth, becoming tech unicorns worth more than a billion dollars. Others make a fair amount on an ongoing basis, becoming a reliable source of income for their founders and employees. But half of all businesses fail within five years of launching. You need to be prepared for that reality.
  • Media stories often make it seem like tech startups skyrocket to success overnight. But the reality is, most successful businesses are the result of many years of hard work – including an entrepreneur’s previous failed attempts that serve as lessons for future development. You’ll need to prepare for a long, complex journey to be successful.
  • Hard work. Being an entrepreneur may seem like a lot of fun – especially when you get to choose your own employees and set your own work schedule. However, no matter what, you’re going to face significant hard work. You’ll be working long hours, often into the evenings and weekends, and facing stress from a combination of many factors.
  • Just because market conditions look a certain way at the beginning of your journey doesn’t mean they’re going to stay that way forever. Many tech startups fold because they can’t keep up with a changing market, new competitors, or other unpredicted factors.

Do Your Research

You should already know the importance of doing your research before starting a business, but many entrepreneurs skip or gloss over this vital step. You’ll need to dig deep into many areas of business development; for example, you should learn about your target demographics, the current competition, future prospects, financial models, and other factors critical to your success.

Objective data isn’t going to instantly make your business more viable, but it will give you something good to start with.

Write a Business Plan

You can’t launch an effective business without having a business plan in place first. Your idea may be brilliant, and it may solve a problem effectively, but does it have a reliable way to make money? Your business plan will force you to think through your entire business concept, modeling financials for years in the future and outlining the biggest strengths, weaknesses, opportunities, and threats before you.

This document will serve as a blueprint you can reference as you invest time and money in your business and begin to grow. It’s also going to serve as a persuasion tool, potentially attracting new investors or partners to your startup.

Build Your Network

Not even the most seasoned, inventive entrepreneurs can build a successful business by themselves. Most businesses strongly benefit from the help of a robust professional network. Through networking, you’ll meet potential investors, partners, employees, vendors, and even peers who can give you advice. Throughout the course of your startup’s development, these people will be indispensable in helping your business grow.

It pays to get an early start here. It’s much more beneficial to have a strong network and start a business than start a business and then build a network.

Find What Makes You Unique

Your business is going to face competition, no matter how original your idea is. There may be competitors already on the market, or they may begin to arise only after establishing yourself as a major player. Either way, you’ll need to find something that differentiates you from the competition. What’s something you can offer that other businesses like yours can’t? What’s your unique value proposition?

Don’t start a business without an answer in mind, or else you’ll face significant competitive issues.

Get Support

Hopefully, you’ll have a network in place by the time you’re ready to launch your startup. Otherwise, you’ll need to start reaching out as your startup begins to develop.

Pay critical attention to:

  • You may like the idea of starting a business by yourself, but even a single partner can reduce your fiscal obligations and make your life easier.
  • Investors can make sure your startup has the capital it needs to grow and become successful; they’re also great sources of advice and direction.
  • Your employees are the people responsible for turning your vision into a reality. Don’t skimp on the hiring process.
  • When your startup begins to mature, you’ll want a few eager clients in the wings to step up and provide you with income.

Foster New Skills

Being an entrepreneur means wearing many hats. In the span of a day, you’ll take on responsibilities like accounting, hiring people, making critical business decisions, marketing, making sales, negotiating, making purchases, and more. You’ll also need soft skills like communication and emotional intelligence.

In the months and years leading up to your foray into entrepreneurship, it’s a good idea to develop some of these skills. See if you can land yourself in a leadership position, whether it’s in your job or a volunteering opportunity. Take courses to develop yourself in areas of weakness, and talk to people who may know more than you on these subjects.

Get a Marketing Strategy Together

There are tons of marketing options these days, even if you have a small budget as an emerging startup. But one thing is certain; it’s almost impossible to build an effective brand presence without marketing. Even if you’re relying on positive word of mouth and referrals, you’ll need some initial marketing to attract your first customers.

Some of the best options here include search engine optimization (SEO) and social media marketing, since they’re both relatively inexpensive, accessible to all businesses, and ideal for long-term growth. However, there are plenty of other options to choose from.

Come Up With Contingency Plans

Don’t forget the failure rate of startups. Even with the best-laid plans, there’s a chance your business will fail. You’ll need to be prepared for that reality with contingency plans – long before you start the business properly.

Consider:

  • Personal financing. Your income may be unstable as your business begins to develop. Can your personal finances take the hit? Do you have another source of income you can rely on?
  • If your business isn’t growing the way you expected or wanted, is there a different business model you could pivot to? What outlets for growth and development are there for your business?
  • Alternate career paths. Finally, are there alternative career paths that could sustain you? For example, is there a different type of business you could start, or could you join an established company in this industry to gain more experience?

No matter how good your startup idea is or how original it is, these steps will be vital to maximize your chances of success. Entrepreneurship is often fun, and always stimulating, but it’s not going to end in success unless you’re adequately prepared.

Image Credit: Minervastudio; pexels

Timothy Carter

Chief Revenue Officer

Timothy Carter is the Chief Revenue Officer of the Seattle digital marketing agency SEO.co. He has spent more than 20 years in the world of SEO and digital marketing leading, building and scaling sales operations, helping companies increase revenue efficiency and drive growth from websites and sales teams. When he’s not working, Tim enjoys playing a few rounds of disc golf, running, and spending time with his wife and family on the beach…preferably in Hawaii with a cup of Kona coffee.

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Fintech Kennek raises $12.5M seed round to digitize lending

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Google eyed for $2 billion Anthropic deal after major Amazon play


London-based fintech startup Kennek has raised $12.5 million in seed funding to expand its lending operating system.

According to an Oct. 10 tech.eu report, the round was led by HV Capital and included participation from Dutch Founders Fund, AlbionVC, FFVC, Plug & Play Ventures, and Syndicate One. Kennek offers software-as-a-service tools to help non-bank lenders streamline their operations using open banking, open finance, and payments.

The platform aims to automate time-consuming manual tasks and consolidate fragmented data to simplify lending. Xavier De Pauw, founder of Kennek said:

“Until kennek, lenders had to devote countless hours to menial operational tasks and deal with jumbled and hard-coded data – which makes every other part of lending a headache. As former lenders ourselves, we lived and breathed these frustrations, and built kennek to make them a thing of the past.”

The company said the latest funding round was oversubscribed and closed quickly despite the challenging fundraising environment. The new capital will be used to expand Kennek’s engineering team and strengthen its market position in the UK while exploring expansion into other European markets. Barbod Namini, Partner at lead investor HV Capital, commented on the investment:

“Kennek has developed an ambitious and genuinely unique proposition which we think can be the foundation of the entire alternative lending space. […] It is a complicated market and a solution that brings together all information and stakeholders onto a single platform is highly compelling for both lenders & the ecosystem as a whole.”

The fintech lending space has grown rapidly in recent years, but many lenders still rely on legacy systems and manual processes that limit efficiency and scalability. Kennek aims to leverage open banking and data integration to provide lenders with a more streamlined, automated lending experience.

The seed funding will allow the London-based startup to continue developing its platform and expanding its team to meet demand from non-bank lenders looking to digitize operations. Kennek’s focus on the UK and Europe also comes amid rising adoption of open banking and open finance in the regions.

Featured Image Credit: Photo from Kennek.io; Thank you!

Radek Zielinski

Radek Zielinski is an experienced technology and financial journalist with a passion for cybersecurity and futurology.

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Fortune 500’s race for generative AI breakthroughs

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Deanna Ritchie


As excitement around generative AI grows, Fortune 500 companies, including Goldman Sachs, are carefully examining the possible applications of this technology. A recent survey of U.S. executives indicated that 60% believe generative AI will substantially impact their businesses in the long term. However, they anticipate a one to two-year timeframe before implementing their initial solutions. This optimism stems from the potential of generative AI to revolutionize various aspects of businesses, from enhancing customer experiences to optimizing internal processes. In the short term, companies will likely focus on pilot projects and experimentation, gradually integrating generative AI into their operations as they witness its positive influence on efficiency and profitability.

Goldman Sachs’ Cautious Approach to Implementing Generative AI

In a recent interview, Goldman Sachs CIO Marco Argenti revealed that the firm has not yet implemented any generative AI use cases. Instead, the company focuses on experimentation and setting high standards before adopting the technology. Argenti recognized the desire for outcomes in areas like developer and operational efficiency but emphasized ensuring precision before putting experimental AI use cases into production.

According to Argenti, striking the right balance between driving innovation and maintaining accuracy is crucial for successfully integrating generative AI within the firm. Goldman Sachs intends to continue exploring this emerging technology’s potential benefits and applications while diligently assessing risks to ensure it meets the company’s stringent quality standards.

One possible application for Goldman Sachs is in software development, where the company has observed a 20-40% productivity increase during its trials. The goal is for 1,000 developers to utilize generative AI tools by year’s end. However, Argenti emphasized that a well-defined expectation of return on investment is necessary before fully integrating generative AI into production.

To achieve this, the company plans to implement a systematic and strategic approach to adopting generative AI, ensuring that it complements and enhances the skills of its developers. Additionally, Goldman Sachs intends to evaluate the long-term impact of generative AI on their software development processes and the overall quality of the applications being developed.

Goldman Sachs’ approach to AI implementation goes beyond merely executing models. The firm has created a platform encompassing technical, legal, and compliance assessments to filter out improper content and keep track of all interactions. This comprehensive system ensures seamless integration of artificial intelligence in operations while adhering to regulatory standards and maintaining client confidentiality. Moreover, the platform continuously improves and adapts its algorithms, allowing Goldman Sachs to stay at the forefront of technology and offer its clients the most efficient and secure services.

Featured Image Credit: Photo by Google DeepMind; Pexels; Thank you!

Deanna Ritchie

Managing Editor at ReadWrite

Deanna is the Managing Editor at ReadWrite. Previously she worked as the Editor in Chief for Startup Grind and has over 20+ years of experience in content management and content development.

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UK seizes web3 opportunity simplifying crypto regulations

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Deanna Ritchie


As Web3 companies increasingly consider leaving the United States due to regulatory ambiguity, the United Kingdom must simplify its cryptocurrency regulations to attract these businesses. The conservative think tank Policy Exchange recently released a report detailing ten suggestions for improving Web3 regulation in the country. Among the recommendations are reducing liability for token holders in decentralized autonomous organizations (DAOs) and encouraging the Financial Conduct Authority (FCA) to adopt alternative Know Your Customer (KYC) methodologies, such as digital identities and blockchain analytics tools. These suggestions aim to position the UK as a hub for Web3 innovation and attract blockchain-based businesses looking for a more conducive regulatory environment.

Streamlining Cryptocurrency Regulations for Innovation

To make it easier for emerging Web3 companies to navigate existing legal frameworks and contribute to the UK’s digital economy growth, the government must streamline cryptocurrency regulations and adopt forward-looking approaches. By making the regulatory landscape clear and straightforward, the UK can create an environment that fosters innovation, growth, and competitiveness in the global fintech industry.

The Policy Exchange report also recommends not weakening self-hosted wallets or treating proof-of-stake (PoS) services as financial services. This approach aims to protect the fundamental principles of decentralization and user autonomy while strongly emphasizing security and regulatory compliance. By doing so, the UK can nurture an environment that encourages innovation and the continued growth of blockchain technology.

Despite recent strict measures by UK authorities, such as His Majesty’s Treasury and the FCA, toward the digital assets sector, the proposed changes in the Policy Exchange report strive to make the UK a more attractive location for Web3 enterprises. By adopting these suggestions, the UK can demonstrate its commitment to fostering innovation in the rapidly evolving blockchain and cryptocurrency industries while ensuring a robust and transparent regulatory environment.

The ongoing uncertainty surrounding cryptocurrency regulations in various countries has prompted Web3 companies to explore alternative jurisdictions with more precise legal frameworks. As the United States grapples with regulatory ambiguity, the United Kingdom can position itself as a hub for Web3 innovation by simplifying and streamlining its cryptocurrency regulations.

Featured Image Credit: Photo by Jonathan Borba; Pexels; Thank you!

Deanna Ritchie

Managing Editor at ReadWrite

Deanna is the Managing Editor at ReadWrite. Previously she worked as the Editor in Chief for Startup Grind and has over 20+ years of experience in content management and content development.

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