How to open a start-up during the pandemic makes no difference because there isn’t anything called the” right time” to start a venture. With an unstable world economy, it doesn’t matter for a business whether the start is better or worse.
What should matter is whether your business model will provide a solution or bring relief to the pains of the consumers suffering today. It will help if you judge the viability of the product/service you want to offer to society. How good they are in benefiting the people when pandemic and post-pandemic when the situation normalizes.
Apart from this, you should have the confidence to say why you are the best over your competitors and should also have the right team to support you in every step. Instead of looking for the right time, you must focus on finding the exact pain point and provide a solid solution for it. This will help you open your dream start-up business whenever you want to.
Before starting a real estate trust, everyone thinks “is real estate investment trusts a good career path” because they don’t have the confidence to pull off the business. If you have thoroughly done your research and groundwork, no one will be able to stop you from starting your start-up venture.
So, to assist you in moving on the right path, we have developed a detailed process for opening your start-up at this time of the pandemic. Follow the route and see your start-up up and running.
Process To Open A Start-up During The Ongoing Pandemic
- Build a rapport with Angel & VC Investors and search for the metrics they are looking for: Whether it’s your personal life or a professional one, this pandemic has taught us how vital our relationships are and that these relations are what matters the most.
So, building a solid relationship (both on and off the business) with your potential investors is a must if you’re a startup founder. You must be wondering what investors see in you (your startup) to make them feel confident investing in your startup.
Some may look for the type of customer your business attracts or the growth rate in your customers. At the same time, others may consider factors, like your startup’s rate of recurring revenue or how low is your acquisition cost.
The direct answer to this question is that different investors look for various factors. Therefore, understanding the requirements of the investors you want to onboard is of utmost importance to make sure that investors end up investing in your startup. And, this understanding is only possible if you build an everlasting relationship with your investors.
- Plan a long-term strategy that would make your startup survive the next 24 months: Even in this time when renowned companies are struggling to cope with the scarcity of resources and the resultant losses, the investment world is seeing investments into those startups who have shown the investors a clear plan to navigate the current situation successfully.
Before investing in the startups during the ongoing pandemic, investors are seeking answers to a few of their questions from startup entrepreneurs, which are:
- What will be your execution plan amidst the pandemic?
- During these challenging times, what type of buyers will buy your product/service and why?
- During the pandemic, how much time will it take for your startup to generate revenue? If you are required to raise more money while running the startup, what will be the amount you need to raise, and at what point in time?
- What are the key metrics that you are measuring? And, do those metrics indicate strong business growth?
Besides, investors are exploring other investment opportunities to invest their money. The stock market is on the rise, but that rise cannot be believed to provide reasonable returns in the long run. With low-interest rates, investing in bonds is also not an excellent option for investors.
Hence, the only option from which they can expect a good return, in the long run, is by cracking deals with startup entrepreneurs. Not just any random startup. They’re going to invest in those that show them a promising return.
- With growth over time, consider mixing equity investments with debt financing: Using multiple forms of financing is much better than using a single one because each of them is more effective at different stages of growth.
Like, a mixture of convertible debts (which are convertible into equity after a certain period), non-convertible debts (which cannot be converted into equity, i.e., you pay it off over time and you are done with the burden of the loan), and equity is considered to be the most practical combination of financing.
In the early stages of your startup, when your business is in the pre-revenue phase, it is recommended not to take debt financing because you may not have any idea or resources to pay off the debt.
However, when your business has formed a solid ground a is running in the post-revenue phase, taking up debt financing is a good option if you do not want to give more of your startups’ shares, the ownership in the hands of the shareholders, especially if you plan to exit the venture after a few years.
All that matters to raise funds is your startup’s balance sheet. A strong balance sheet is key to unlocking the fundraising and financing doors for your startup. A better balance sheet at the time of pandemic will give you leverage over your competitors and attract investors towards you, but remember that this task is not as easy as it sounds.
Starting a startup during this pandemic is challenging but not impossible if you have the right plan, approach, and execution ready with you. The above process will help you start your startup as it focuses on the intricate layers of the initiation process. If you can accomplish these, the later-on stages will be easily achievable. And, if by chance you are not able to start your startup, there are plenty of best paying jobs in real estate investment trusts that will help you accumulate money, which you can save to open your startup after a certain period.
Author Bio: Sofia Kelly is a passionate blogger. She loves to share her thoughts, ideas and experiences with the world through blogging. Sofia Kelly is associated with The Daily Notes, Content Rally, Real Wealth Business, Online News Buzz, Top Preference & Big Jar News.