There are a lot of reasons to start your own company. These can range from being burned out at your former job, company lay-offs, or even an idea or opportunity which you could not forego. Whatever reason you may have to start your company, you still need to have your ideas checked and validated before you start finding financing.
A business is a continuing concern, where there is a capital that you have to maintain a steady stream of cash flowing in and out. To be successful you have to make sure that more money is coming in than going out.
To ensure that happens, you must have a service or a product which people want. The problem is in knowing how much this service or product is needed. You have to ask yourself several questions, including:
- Does The Need exist?
- How big is the demand for the product or service?
- Does it already exist?
- Will you have competition?
- How much do you think people are willing to pay for the product or service?
Typically, these questions are all answered before you even begin to raise capital for the company. This forms part of the business idea validation process. Most businesses conduct studies or have these studies contracted out. They pay to find out if the product or service can be sold, for how much, and how many.
Below is an interesting infographic about startups, and the various ways to validate your startup ideas. There are basic questions that you must find out before you start organizing your business. If you did not take the time to study it, then you will have to find out the answers to these questions the hard way.