Start-up Lessons Learned
The chance to design and start our own business as part of Designing a Business module provided me with great opportunity to acquire new knowledge, gain experience and learn by working in a great team. Now, almost a year later since the start-up of our company—Calamari–this blog will reflect on the experiences and lessons learned along the way, thus far. Below I will reflect on the process we went through to launch our business and the important lessons/knowledge learned during the course of designing the business.
As the Calamari team and in planning, building and launching our business we went through five fundamental entrepreneurial processes that I believe are necessary for launching any successful venture. These five phases of entrepreneurial processes were: idea generation, opportunity evaluation, planning, company formation/launch and growth.
- Idea Generation: All new successful ventures start with an idea. The idea could be solving a particular problem (new product/service) or offering solution to improve a current product/service. In our context, the idea at the initial stage was to solve the problem of getting burned when drinking hot beverages.
- Opportunity Evaluation: This is the phase when the idea/opportunity is assessed on whether it’s worth investing in. Here five criteria’s must be fulfilled when evaluating an opportunity:
- Is there a market opportunity? Is it an attractive market to invest in? What is the size of the market? Doing market research.
- Is the solution offered feasible? Is the product/solution viable from the market and technical perspective
- What is our USP/comparative advantage over established businesses
- Do we have the capability/resources or the team and the technical know how to succeed
- What are the risks of involvement in this business opportunity
The answer to the above five questions determine whether the opportunity is viable or not. Going through the above process in our initial idea generation and opportunity evaluation we eliminated our first idea as not being viable. It was for building burglar deterrent devices for students.
- Strategy: In this phase of the business specific and relevant strategies are needed to capitalize on the opportunities identified. Mainly three strategic decision making needs to be made at this stage of the business:
- Target Customers: A set of potential customers/buyers needs to be identified at this stage of the business and the products/service needs to be designed specifically to solving their particular problems. A qualitative and quantitative research can help to make this decision.
- Business Model: Choosing the right business model is important. As it will determines the profitability, revenue streams and cost and the ability of the business to effectively address the needs of the customers.
- Positioning: It’s important to make a strategic decision on what tasks the business will perform and what task it will not do as to differentiate it from its competitors. Also, here the company’s vision/story should be developed on how the brand/business wants to be known to its potential customers and shareholders.
We at Calamari when starting our business did not follow the above process, as none of us knew about the different stages and processes. We learned this through, reading, trail and error, own experience and experimenting.
- Company Formation: After establishing that the business opportunity is viable and solid, the right form of legal and corporate entity can be created.
- Growth: At this stage the focus changes towards building the product/service, generating revenue and sustaining and growing the business over time. Marketing, raising brand awareness and building relationship with customer are critical to the survival of the business.
The above processes were followed when creating SpeaCup stickers and the reason why the above were reflected upon here. As its crucial to learn from this entrepreneurial process as starting and building any future business venture requires the same process to be followed in order to successfully established it.
The first and immediate lesson I learned from working with my team, who were studying the creative economy pathway unlike myself, and from starting our business, gave me the opportunity to learn and be expose to new creative and unorthodox way of thinking about problems/solutions. For Entrepreneurs, creativity is very important for coming up with completely new ways of doing things, to spot new opportunities, to change and to innovate. As change creates opportunities and entrepreneurs create value by creating changes in different aspects of businesses primary and support activities. Leading to new ideas, products and services. Furthermore, creativity and innovation is at the heart of true entrepreneurship, as, Porter (2008, 2004 & 1996) mentions, companies achieve competitive advantage and stay ahead of their competitors’ in their industries through acts of innovation and creativity (Burns, 2011, Drucker, 2002, and Christenson, 1997).
Having been exposed to such creative people and environment and having my ideas constantly challenged in new, different and exciting ways, was very stimulating and great learning curve form me. Which, I believe I have developed new sets of skills, knowledge and way of thinking that I can use both in my professional and daily life, as a result.
I will be honest and admit here that I had no idea about design thinking before starting my course. Since, I have been both fascinated and wanting to find out more about design thinking and learning to apply it to our business venture.
Design Thinking as Tim Brown (2008) defines it is a process/tool of thinking in terms of applying “innovation activities with a human-centered design ethos” (Brown, 2008, P.1) to solving and adequately and directly addressing people’s needs and preferences (Brown, 2008).
I believe when designing our own product, SpeaCup stickers, we were influenced heavily by this concept and were constantly thinking and trying to see our product and solution through the eye and needs of the end user for our product.
Furthermore, the other reasons why I like the discipline of design thinking and reflecting and thinking about is that it can be a powerful tool when designing a new business or a new product or service. Specifically, that can concentrate the energy and finite resources of the entrepreneur into solving and creating solutions that directly impact the lives and create indispensible value.
As I have been writing about in my blog, design thinking concept can give the entrepreneur tools that can be used to create unique and differentiated products or services for s specific problem or customer segment. Providing the entrepreneur with a unique competitive advantage over its competitors (Porter, 1997, 2004 and 2008).
In addition, as it has been argued in my blog about disruptive innovation, through design thinking and concentrating on solving problems for specific customers. Entrepreneurs can bring new creative solutions and technologies, material, processes, designs and business models that change and even reshape the whole industries by making the old way of doing things obsolete.
Through concentrating and spending time, energy and resources on finding out specifically what customers likes, wants, needs, company’s can create niche markets and competitive advantage through using the discipline of design thinking (Tidd and Bessant, 2013, Kelley and Kelley, 2013 & Christenson, 1997).
This is true for instance in industries such as: movie rentals (Netflix), PC (phones and tablets), Kodak-Photography (digital camera), classified ads (Craigslist), long distance calls (Skype), record stores (iTunes), research libraries (Google), local stores (eBay), taxis (Uber) and newspapers (Twitter) these examples show that industries have been reshaped by disruptive innovations and thinking about the end users.
I believe design thinking has already had a huge impact in how I think about approaching new ideas about designing a business and product development and will be critical in my future endeavours.
Storytelling & Building Brand Persona
As part of the course to have an outside consultant to come in and talk about how to create a story and brand image was very useful for our product and business development. We understood as a result of this class and from subsequent reading about it that it was important to build and image about our product and how it can be used in different scenarios to enhance the lives/experience of our end users when engaging with our product.
Furthermore, it was interesting and useful to find out how through storytelling one can engage and reach target customer in a very unique and deeper level. As through ones products story, brand image and persona can distinguish oneself from other competitors products and services.
Pitching & Blogging
Given that, as part of the course we were required to blog about our experiences and to do elevator pitches often, I believe these experiences immensely improved my confidence and skills to better express my ideas and thoughts to general audiences and gain new skills and knowledge.
For all these reasons I am happy and grateful that I took the Design a Business module and in the process meet amazing sets of friends, learned from shared experiences and designed a business.
In future I hope to use and apply these skills and knowledge learned in my future endeavors and hopefully start a services based company in near future.
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