4 tips for Indian entrepreneurs to start a new business on a budget
One of the biggest challenges to launching a business is lack of funding. A report by Association of Chartered Certified Accountants (ACCA) states that almost 80% of small business owners in India struggle to access credit from traditional lending channels. While loans, funding and venture capital are all great options, you don’t always need money to get started and acquire your first customers. In this article, we will explain how to find an idea, take it to market, and build a great business without the need for large amounts of money.
Step 1: Think of ideas that can be quickly validated
Before starting out, most entrepreneurs usually take the following into consideration:
- What to launch?
- Would people want what I’m offering?
- How to get my first customers?
It is critical to identify the right business idea ie, a product or service that people want. We’ll explain below some of the ways that you can come up with ideas quickly.
Find what you are good at: When coming up with a new business idea, your proposition should:
- Solve a problem
- Serve a specific audience
- Provide clear-cut benefits to the client
Good examples to consider are service and consulting businesses. These can be quick and easy to start. In the early days, they don’t require premises, coding or physical inventory. All you need is the time to fulfil what you promise to deliver.
Create a solution you want: Many small businesses are born from founders solving their own problems. Ask yourself:
- What products/services are you dissatisfied with?
- What problems do you face on a regular basis?
- What could be their solutions?
These problems could be anything – eg, unavailability of organic/healthy food options in your area. Let these needs drive your business ideas.
|⚡ Pro Tip: Conduct market research to identify valuable gaps that you can fill with your new idea.
Identify gaps in a market: It’s important that you identify trends and pain points in a market, and tailor your business to serve a unique purpose. Let’s say you’re passionate about organic farming. Reach out to your audience and ask them exactly why they like organic food? This way, you can identify gaps in a market and build a product that customers love right back.
Step 2: Use insights to build an audience
Before you start building your product/service, you need to make sure that people actually want what you are offering. Reach out and talk to your audience on social media. It will help you generate qualitative insights to build an audience and define your value proposition.
Instagram – a direct line to your audience: Instagram has become popular for conducting customer research. According to a Facebook survey, Instagram helped 81% of respondents research products and services.
Use hashtags to identify and reach out to users who are posting content relevant to your business and ask them questions about your proposed product or service. These insights could fuel your product/service design, as well as your marketing message.
|⚡ Pro Tip: Use social media to build strong relationships with your customers and to grow and scale your audience over time.
Use data to understand your market: Use market data and trends, from industry publications and reports, to validate your business ideas. Identify the trends, challenges, and customer needs. You can also use Google to search for terms like “top [keyword] challenges” or “top [keyword] statistics”.
Doing this you can uncover businesses trends and challenges related to –
- Map competition
- Update SEO tactics
- Build online brand identity
- Revise marketing strategy
- Sell the right product/service
|⚡ Pro Tip: Use tools like Google Trends to assess the demand for your business idea.
Build an audience with great content: Identify where your audience hangs out online and create content that gets in front of and attracts them. Drive them to your website’s landing page. This process is critical for nurturing your new audience and generating insights for your business idea.
For example, if you find your audience is active on Instagram, create content for them there. Ensure that you mention your website link, if you have one, in the bio.
|⚡ Pro Tip: Create quality Instagram content to turn your followers into paying customers. According to Hootsuite, an average Instagram business account grows its followers by 1.69% each month.
Another approach is to set up a blog and create valuable, conversational, in-depth content that educates and entertains. Businesses that share a wide variety of content are often ranked higher on Google search.
|⚡ Pro Tip: Ranking higher on Google will increase the organic traffic to your site. Google gives preference to websites that are updated regularly with time, have relevant backlinks and lots of content!
Step 3: Focus on pre-sales to get your first customers
People are more willing to say “yes” to an idea than they are to pay. Therefore, the best way for entrepreneurs to validate any idea is through pre-sales. According to McKinsey & Company, companies with strong pre-sales capabilities consistently achieve win rates of 40–50% in new business and 80–90% in renewal business. Pre-sales can help you generate customers before you even build your product or service.
Here’s how you do it.
First, define your offer and benefits clearly: Be transparent about what you’re offering to your audience. Clearly state:
- What’s the benefit of your products/services? Why now?
- Who exactly is it for?
- What are the specifications?
- What’s the price point?
|⚡ Pro Tip: You could consider offering a discount for early adopters. This could dramatically lower the barrier to entry to buy from you.
Second, write out your offer: Your business roadmap and the benefits of your product/service should be clear to your audiences. At this stage, focus on whether people are willing to buy what you’re offering. Save the volume for when you have a product and you’re gaining traction.
Here’s a sample message you can repurpose for your outreach emails and DMs:
I help business owners, such as yourself, with their digital marketing efforts. I am planning to undertake a monthly Digital Marketing Workshop for businesses such as yours. Through this, I will provide step-by-step strategic instructions to grow your business.
I’d be happy if you’d like to be among my first 3 paying customers. I can lock you in for a pre-launch price of ₹2000 a month (a 50% saving as I’ll be charging ₹4000 /month when I go live!)
Also, as you’re helping me start up, I’ll create a tailor-made marketing plan for you. If you’re interested, let me know and I’ll send my UPI details over.
Thank you in advance!
Here’s why this outreach message works well:
- It gets to the point about the sender’s offering and the benefits
- It offers an incentive to the recipient
- The conversation is set around commercial intent, not fact-finding
- The call-to-action will get a yes, no or a request for more information
Finally, learn from feedback: If people say no or ask questions, or aren’t willing to buy what you’re offering, it means you haven’t found a big enough problem or desire in the market. In this situation, assess what you’re missing. Have an open dialog with prospective customers and encourage them to be candid in their feedback.
Step 4: Build your own MVP
A minimum viable product (MVP) is a product or service with a basic set of features designed for early adopters. The primary objective of an MVP is to test a business idea. Small businesses and startups can create an MVP, at minimal cost, to find a response from their target audience. It helps them develop or create improved iterations to enhance the value development.
While the term was originally coined for tech companies, it can apply to any business model when starting out. Here are a few things to keep in mind when building your MVP:
- Gather feedback early: Use your initial customers as a method of getting feedback. Treat them as beta testers, and ask them what they find valuable, what they like and what you could do better.
- Keep convenience in mind: When building your app or software, make the design flow super simple for customers to navigate. This will set some creative restrictions, forcing you to add only the necessary steps and features.
- Measure success: Are your customers referring new users after launch? Is there a high level of engagement? Look at your analytics to see how your users are interacting with your app, how long they’re sticking around for and which features they’re using the most.
|⚡ Pro Tip: Focus on the one thing you do to solve a specific pain-point and make your service offering all about that.
As long as you’re building and setting up something people want, you’re on track to succeed in your new business endeavour.
Make sure to follow these tried-and-true best practices below:
- Find ideas to validate by tapping into skills and finding gaps in the market
- Get insights from your audience and start building relationships
- Generate pre-sales to fund your product or service and build confidence
- Build an MVP before you scale further