This article is written by Clinton James, a Contributor Author at Startup Turkey.
Anil Advani is the Managing Partner of Palo Alto and San Francisco based law firm, Inventus Law.
Starting a successful startup requires following some a process, and a good one at that and the article explores the steps of the process.
Find your North Star. This is what you are working towards as well as the point of return when one gets lost. Do your research and this is research that applies to your business. There is no reason to exclude this step as we have tools such as Google. It is highly unlikely that you are doing something that has not been done before thus there is information that would be very relevant to you. Find out who else has solved the same problem you aim to solve and how they did it even if it was for a different market. Usually, solutions are adopted from existing ones but then customized for a specific market. This helps validate one’s ideas and know what will work and what will not. Validate the current technology to assess if it would help you build your product.
Building the team. It is important to build an all-round team that will sell the product both for money and feedback. There is no point of building a product if no one is going to buy it. The team has to comprise of more than just those building the product for example sales and marketing people. Pick people who are solely dedicated to one task and have them communicate constantly for success of the product. From the start, it is important to get everything in writing. This involves equity and leadership of all the people involved. Do not be embarrassed to do this especially when working with friends.
Find a good lawyer from the word go to get the basics done as it is crucial. This is simple for startups as they do not require much. This ensures you understand your control on the board of the company and ownership of shares especially if you plan on selling the company later. It is difficult to sell a company, no matter how established it is, without the correct legal works.
Raising money for growth, startups fail not because of lack of money but because of focusing on funding before they need it. They need to look for it only when they need it. When raising these funds, always raise at least 25% more than what was needed as expectations are higher as the business grows. Then, how are you to raise the funds? Research and ask those who have done it. Venture capital investors are also good. However, make them your friends. Their work is to see to your growth as they have to report back their investors.
How to exit. From day one, you should think of growing the company to sell it for a lot of money and move to something else. Thus setting a goal on when the company should be sold and working towards it and not to exceed it, as it is important.