Every aspiring tech entrepreneur has a point in their lives where they introspect and ask themselves a question relevant to their startup, how they can start a tech company with little or no money. This is the question we must attempt to answer in this article. A revenue model is the centrepiece of a successful model, but starting off with very little money is not unheard of, especially for massive corporations. We shall be looking at ways by which you can start off with nothing and work your way into being a successful business.
Major challenge for startups.
The major challenge for any startup is identifying their significant objectives and potential market niches that they should cover. Without proper financial backup in the initial stages, the entrepreneur must precisely identify and locate market areas where they should target. They should also have all the answers to the company’s scope, expansion, and early and late aspirations. But the best way to start is looking for a revenue stream you can use.
– Always stick to your strengths in the market without over-complication.
It is imperative that a business should be built around a working and tested plan. Your company should not start top-heavy with heavy investment at the base level. At the outset, a tech company must resolve several conflicts of interest; decide prices and the type of market they want to try to capture.
All these methods involve intensive research and, by extension, a huge amount of funding. Testing and getting the product off the ground level first before looking for massive investment is something that several big corporations have resorted to. So, the prudent thing to do here is always to start slow and grow your business iteratively, making use of user feedback to improve the features of the product constantly. Starting by being fashionable as a Limited Liability Company (LLC) will only aggravate your growth because of expenses.
– Getting funds to scale.
The source of funding should be a priority if the financial aspect is on the low. But you should always make judicial decisions on the type of fund you are getting, and you should use it to grow. You must only use the funding to scale. First, you must establish your product and your market.
There are different types of methods you can use to obtain what can be classed as real revenue, such as –
- Crowdfunding services like Kickstarter and Fundable are a great way to source from the general public. Some techniques of crowdfunding also offer investors stock options.
- Angel investors are ex- founders who have just sold their companies and have had a cash influx. They often invest in small scale and growing companies.
- Accelerators. The best thing about these investors is that they do not just offer money but connections and other services to help kick start your business.
– Research before you make.
The one thing you should not do is to start off with building your product, even without any investment. You would think this product should carry you through several investor meetings and leave an impression on the venture capitalists, but it is but a later step in the development of your company. So before you contact the expensive developers to construct your genius idea of a project, you must ensure to study the market correctly. At first, any company should extensively study the market before embarking on a grandiose product launch and spend millions on marketing.
It may seem contradictory to not start off your tech company by building your innovative tech straight away, but this is counterintuitive in the long run. You should always ensure that there is an audience in a place that is planning on using your product. Most of the tech companies has started off with product launches, which kept them in a catatonic state regarding development. They had to spend millions on marketing and distribution alone, with no one to buy their product. The way to succeed in this sector is to sell the experiences you will be offering.