The Entrepreneurial Life Cycle

Stage 1: Test Ideas

This is the stage where you have one or more ideas and wish to get a quick sense of which ideas are worth exploring further.

What to do and not do:

  1. Design your idea into a business. Who are your customers? What are they buying?
  2. Write down the assumptions you are basing your idea on. They might be right, they might be wrong. You’ll need to test them
  3. Talk to some people who could be customers, to find out what they think. There are ways of doing this – everyone will tell you the idea is great, but would they buy it?


Don’t

Write a big complicated business plan. It is a waste of time until you need to get investment or a loan.

Stage 2: Focus on an Opportunity

This is the stage where you have narrowed down to one idea that appears to be promising opportunity and now is the time to go for deep dive to flesh out all the business model assumptions.

What to do and not do:

  1. Work out what is the least you can do and the least you can risk getting the business going (called a minimum viable product).
  2. Try a few experiments to see what people will really buy.
  3. Beg, borrow or steal (!) resources before you buy them.


Don’t

Buy loads of kit to make yourself feel you are getting somewhere! Think sales, sales and sales.

Stage 3: Commit Resources

This is the stage where you checked your business assumptions and are ready to take the plunge by committing your time, money and energy. You would look to build a team and

What to do and not do:

  1. Plan to fully start the business, based on what you found people will buy
  2. Find the resources you need to get going, either for free or so you don’t have to pay for them until you have some money coming in
  3. Build the team you need


Don’t

Take on loads of fixed cost

Stage 4: Product Development, Market Entry and Fundraising

This is the stage where you enter the market. You have at least the first version of the product developed, your core team in place and have established your market. You may also look to raise funds from external investors.

What to do and not do:

  1. Sell sell sell
  2. Build your credibility – get customer references, use everyone as a marketing channel.
  3. Only if you need investment, build a business plan.


Don’t

Worry too much about profit. This is all about cashflow.

 

Stage 5: Grow

This is the stage where you are established in the market and ready to go to scale. Your customer base is rapidly growing, the operations are scaling up, the headcount is expanding. You must keep pace with rapid growth.

What to do and not do:

  1. This is where you develop professional management practices & processes
  2. You might need investment to grow. Either debt or venture capitalists.
  3. You will need more specialists in the team


Don’t

Expect your company to be the same. You will have to let go to let it thrive. It is now bigger than you are.

 

You could stop here. The next stage is certainly optional, and not for everybody…

Stage 6: Sell the business

You have at least the first version of the product developed, your core team in place and have established your market. Typical exits are an initial public offering (IPO), being acquired by a larger, publicly traded corporation, or a merger.

What to do and not do:

  1. Get professional advice
  2. Make sure it is the right move for you
  3. Be honest with yourself if you are still the right person to be at the company


Don’t

Hang on and try to manage a business that has outgrown you. Maybe start another business instead? After all, you are a professional entrepreneur now!

If you are considering starting your business as an alternative to your current work, come and learn from best instructors in this business. Taught by executive education and entrepreneurial faculty from London Business School you can either

  • Join our 1-day bootcamp “Crafting your entrepreneurial opportunity”, to Create, refine and take the risk out of your new business idea. Click here for details or if you already have an idea
  • Join our 8-week evening workshop series, “Developing your entrepreneurial business”, which will take you through a staged journey to convert your idea to a real business. Click here for details

Held in London, the 1-day bootcamp and 8-week workshop have been designed for working professionals, and delivered by faculty who have not only helped grow businesses at King’s College London, London Business School, UCL, LSBU (Entrepreneurial University of the year, 2016) in the UK but also a number of universities, institutions, and governments abroad.

- Viren Lall