Entrepreneurs should always be aware of the power of their brand but in the early days of a business there may be more critical issues to focus on, from building your team to product development. Mo Luthra, brand strategist at agency Bland to Brand says that a strong brand can set a company apart by creating an idea and a feeling that makes customers like its name, logo, website, communications and values.
Luthra says: “Evian sells bottled water but it also sells purity. A Norwegian underwear business I know called Comfyballs sells fun. It makes you think ‘I like these guys, I want to buy into it’. To play on that level comes from understanding your brand values and defining them well. Later these values can be used to drive your marketing and be used to train staff with customer interaction or even how you bring your offices to life.
“Building a brand is one of the best long term business strategies available to companies. Brand is the reason why someone’ likes you,’ there is no logic to it. As a business grows it needs to invest in its brand to defend itself from competitors.”
Building your team
That investment can’t be made straight away because start-ups have so many other issues to consider. They need to get the basics of their business right first. Ian Richards, Director at early stage venture capital firm Northstar Ventures says team building is one of the areas entrepreneurs should be putting their nascent energies into. “Decide who is going to be part of the team going forward and work out their equity share,” he says. “You should be looking at an even spread rather than one dominant shareholder.”
As part of this start-ups need to draw up a shareholders agreement regulating directors’ and other shareholders relationships and actions with each other and Articles of Association when registering the company. This sets out basic legal and administrative arrangements. Start-ups should also make themselves aware of all the legal regulations both within their specific sector such as road transport laws if they are a haulage business and general legislation such as health and safety and consumer law.
Perfecting your product
Richards also urges entrepreneurs to concentrate on their product or service in the early days. “Have you got a prototype? Do you know if it is of interest to potential customers? Do you know how to go about testing the concept and analysing feedback?” he asks. Sue Cadd, head of business incubation and growth at the University of Lincoln, adds: “Do your customer and product research. Identify and understand your niche and how it will work in the competitive landscape.”
Start-ups should be looking at how to market their presence both in print and through social media channels. “What’s your name and trademark? What exactly are you offering which is going to be better than your rivals?” asks Cadd. Richards adds: “You need to define your product price, the geography and consumer or business sectors you are targeting. Develop a sales plan and wider business plan, and keep reviewing it.”
Understand the finances
Finance is crucial, both the understanding of cashflow and income, forecasting and monitoring overdraft facilities. Start-ups should constantly be looking at funding options, talking to business angels about early-stage investment and looking at grants from government or regional development authorities. Friends and family could also be a valuable source of funds. Location is also important. Where are you going to be based? Can you find accommodation in business parks or start-up hubs where you can collaborate with like-minded people? Is there a university close by where you can source assistance and guidance in product design or strategy?
Cadd also urges entrepreneurs to give a clear focus to their work-life balance. “Bill Gates famously worked 16-hour days every day for five years,” she says. “Entrepreneurs need to understand that they will be giving up large amounts of their own time on building the business from day one. They need to manage this or be faced with problems such as stress.” So many right and wrong roads to go down. But once established and secure start-ups can then begin to put their name and brand in lights.
Your St. James’s Place Partner will be able to advise you on which of our panel providers you would need to be referred to, given your particular circumstances for further advice in this area. Where the opinions of third parties are offered, these may not necessarily reflect those of St. James’s Place.