4 Steps to Founding a Startup
Enthusiastic ovations, crowds of customers and millions in the bank. None of this comes overnight. The start of the journey to the entrepreneurial dream is usually much more modest. It all starts in the environment of a startup that will (hopefully) grow into a thriving company over time. We'll advise you on how to start one.
What is a startup?
A startup refers to a fledgling (often technology) company with the potential for rapid growth and big ambitions. An innovative idea that will help the company breakthrough is important.
Succeeding in the market as a startup is not easy, but if you do, a small company can gradually become a thriving giant. Among the companies that have broken through in the Czech Republic in this way are the e-shop Rohlík or the taxi company Liftago. And there are many examples abroad - for example, the financial company Revolut or the technology company Canva, which runs a popular graphic editor.
Let's take a look at how to set up and launch such a startup.
Step 1: An idea with potential
At the beginning of every successful company is an original idea that will attract potential customers and investors.
If you haven't thought of a revolutionary idea yet, don't despair. There' s plenty of inspiration around you - just pay attention to the problems people in your area are solving. A new business can relieve them of these worries. Ideally, if you can find a gap in the market, your product or service will fill it first.
However, there are a huge number of companies in the market today. So coming up with something truly original isn't easy - and it's not always necessary. Sometimes you just need to bet on what you 're better at than others and build a business on your skills.
Make sure you plan carefully before you go into business. Only the most skilled will make it among the stiff competition. According to statistics, only 1 in 10 startups will succeed in the long run. A full fifth of start-ups don't survive their first year - and you don't want to be one of them.
Step 2: Situational analysis
Do you think your idea has a chance of success? The only thing left to do is to see if others see it that way. Before starting a business, it's a good idea to conduct market research to see if there will be interest in your new product or service. The main cause of startup failure is lack of customers, so we recommend not to underestimate this step.
Map your target audience and critically evaluate the strengths and weaknesses of your offering. This will give you an idea of how to argue your case when selling.
Don't forget to also check how your competitors are doing. As a new player in the market, you need to differentiate yourself from them. Think about other obstacles that may be preventing your business from taking off - whether it's a limited budget, legal regulations or the current situation in the country.
There are a number of ways to analyse the market environment. The most popular methods can be found in the situational analysis guide.
Step 3: Business Plan
Now you know what you are facing. What remains is to give your ideas a concrete form on which to build your business. This is what a business plan is for.
This is a document in which you lay out your business model, set out your business objectives and write down the framework strategies for achieving the results (ideally with a timetable). A business plan usually includes a financial and marketing plan.
We describe the structure of the document in more detail in our guide on how to create a business plan.
Step 4: Starting a business
The preparation phase is almost over - it's time to put the plans into action. To do this, you need to formally establish the company, which requires a notary, several trips to the authorities and plenty of patience. You will draw up a memorandum of association, open a bank account, get a trade licence...
The whole administrative round in the Czech Republic takes on average over 24 days. Do you want to do it faster? We guarantee you the establishment of a new company within 3 days. You have less to worry about at the beginning - just contact us.