Everything you need to know about starting a startup
- Henk Herkink
- 16 Jan 2020
- Edited 16 Dec 2022
- 3 min
Have you made an invention or have an idea for a new product and are using new technology? Then you are a startup. With proper preparation, guidance and by taking the right steps, you can achieve tremendous growth as a startup and even take over the global market.
Several startups and startup hubs share their experiences and talk about turning ideas into reality, with Cathy Oh, KVK’s Startup Officer, weighing in about how to avoid various pitfalls.
Work out your idea properly
Work out your idea by asking yourself the following questions:
- What problem does your idea solve?
- What solutions already exist for that problem?
- How does my product or service (in Dutch) differ from existing alternatives? Is it really innovative and interesting for customers?
- Who are your customers and users? The difference is a question of nuance: customers pay, while users do not.
- What is your business model?
- Do you have a broad customer base? Break it down into several smaller, more specific parts. Focus your attention on the group where the need is greatest first.
- You need money to turn your idea into reality. How do you plan to finance your innovation?
KVK’s Startup Officer Cathy Oh opens says: “One good idea does not make a successful business. Your ideas and enthusiasm are key ingredients that will help foster growth. But it is essential that you write a business plan and come up with a sensible revenue model.” This is the only way to make money with your company and come across as a credible company for investors and your (potential) market.
Approaching potential customers
Once your idea starts to solidify, you will want to put it on the market. Cathy Oh: “Is the market ready for your product or service? And is your product fully developed and ready to be sold? A common obstacle for many startups is that although there is interest in their product, not everyone is willing to be a customer. This can happen for any number of reasons: you may be ahead of your time or your product may not meet the customer’s needs and wishes (too small, not scalable).”
To avoid this obstacle, you can present your idea to potential customers prior to launch or involve them in the development process. One way to make sure that your product ticks all the boxes is by co-creating (in Dutch) it with customers and partners. Looking back, Onno van der Poel of startup TicTag can clearly see the merits of this approach: “At TicTag, we waited until our first real potential customer showed up. While you can put your product through lots of test and research even before you land your customer. In retrospect, setting up our own test panel would have been smarter for TicTag and, more importantly, it would have helped us save a lot of time."
Register your idea
Once you have fleshed out your idea, you can register it in the i-DEPOT. By legally registering your idea, you get proof that you came up with, created, or designed your idea on a certain date. This can be invaluable if you end up in legal proceedings. You can register all sorts of ideas in the i-DEPOT, from fashion designs, lyrics, books, movies, scenarios, inventions, or prototypes.
Only after your idea has become a product or service can you protect it with intellectual property rights. Ideas cannot be considered IP.
Turning your idea into a business
After you register your idea, you can start thinking about forming a company to sell your product or service. See this checklist to find out exactly what you have to do when you start working for yourself.
Financing a startup
“You need money to develop your product and run your business. Apart from seed capital, you may need more financing during the subsequent growth phases that your startup can go through. Not every startup manages to secure multiple sources of financing throughout their lifespan," Cathy Oh says.
To have insight into your finances, it is best to create a financing plan. Heerd Jan Hoogeveen of the Utrecht Region startup hub has the following advice: “Think carefully about financing and draw up a plan, making sure to think of the future, too. Investors will know perfectly well that you may also need financing in your next growth phase, and the last thing you want is to burn through all your money and be left stranded.”
Have you ever considered business angels? Business angels invest in businesses in order to make money, and startups are often an interesting proposition. They can help you with capital, but can also provide good advice and assistance.
Coaching for startups
There are many organisations and associations that can help you get your startup off to a promising start. Explore which organisations can help you.
More and more ambitious students are starting startups. Do you have big plans and want to grow quickly? Learn how to tackle product development, what options are available for start-ups, and how to use your innovation to earn some extra income on the side (in Dutch).
Growing your startup
Once you get your business up and running, money will start coming in and you will be able to grow into a scaleup. As a scaleup, your business plan will target a broader audience and propel you towards the international market. During this growth phase, you will have to make lots of new decisions.
- Hiring staff for the first time: There comes a time when you can no longer handle the work alone. At that point, hiring staff will become an interesting option.
- Leadership: As your company starts to grow, your job description will grow too. You will have to be a manager. Leadership is a very particular skill. If you realise that being a leader is not exactly a strength of yours, hire a manager.
- Finance your growth: When your company starts making waves, you will need money to invest. But how do you go about finding financing? There are lots of ways to get your hands on financing, from subsidies and government schemes to investors.
- Selling your business: Do you want to keep growing? Or do you want to make money fast and prefer selling your business?