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Instantstartup PDF
Instantstartup PDF
3 What’s the
Big Idea?
Getting an idea for
your business: It’s not
as hard as you think.
5 Get With
the Plan
How to create a
winning business plan
7
11
7 Where’s the
Money?
Finding financing to
get your business up
and running
14
11 Spread
the Word
How to promote your
business
14 Net
Works
Setting up your
company Web site
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competition you face and how you tions of your primary managers, including an
will position yourself to beat it. overview of their backgrounds and functions in
❸ Finally, the financial section con- your organization. You should also provide perti-
tains your income and cash-flow state- nent coverage of pivotal positions, such as the vice
ment, balance sheet and other finan- president of R&D in a high-tech company, in addi-
cial ratios, such as break-even tion to more mundane functions, including CFO,
analyses. This part may require help controller and so on.
from your accountant and a good Plan readers will want to see evidence of a
spreadsheet software program. well-rounded management team that can deal with
Breaking these three major sections whatever comes up. You may want to include an or-
down further, a business plan consists ganizational chart that graphically depicts individ-
of six major components: ual responsibilities and who reports to whom.
❶ Executive summary
❷ Management PRODUCT OR SERVICE
❸ Product or service This is the place to explain all the key elements of
❹ Marketing the product or service, including its design, under-
➎ Operations lying technology and, especially, competitive advan-
❻ Financial data tages in the marketplace.
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LEARNING THE
LOAN LINGO
Hallelujah and yippee! You can almost
hear the choirs of angels singing as your
banker smiles and hands you the loan
document. You got the loan!
Not so fast. Before you sign that piece
of paper, take a good look at what you’re
getting into. Many entrepreneurs are so
excited about having their loans ap-
proved, they fail to read the fine print on
their loan agreements. That can lead to
trouble later on.
It’s a good idea to get the loan docu-
ments ahead of time so you have a
chance to review them for a couple of
days before it’s time to sign, according to
the American Banker’s Association.
Bankers won’t have a problem sending
advance copies of the documents but
will generally do so only if you specifi-
cally ask for them.
Most bankers will be happy to help
you understand the fine print, but it’s
also a good idea to have your accountant
and lawyer review the documents, too.
Although it varies slightly from bank
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U N C LE SAM WANTS YO U
Where can you go when private fi-
nancing sources turn you down? For
many start-up entrepreneurs, the answer
is the SBA. The federal government has
a vested interest in encouraging the
growth of small business. As a result,
some SBA loans have less stringent re-
quirements for owner’s equity and col-
lateral than do commercial loans, mak-
ing the SBA an excellent financing
source for start-ups. In addition, many
SBA loans are for smaller sums than
most banks are willing to lend.
Of course, that doesn’t mean the SBA
is giving money away. In fact, the SBA
does not actually make direct loans; in-
stead, it provides loan guarantees to
entrepreneurs, promising the bank that
it will pay back a certain percentage of
your loan if you are unable to.
The SBA can help you prepare your
loan package, which you then submit to
banks. If the bank approves you, it sub-
mits the package to the SBA. Applica-
tions submitted by regular lenders are
reviewed by the SBA in an average of
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long enough to cover the six basic ele- contact names and num- four to six days after
ments: who, what, when, where, why
bers. Make your own you’ve sent the informa- Bright Idea
media directory listing tion, then follow up your
Whenever possible, tie your
and how. The answers to these six names, addresses and pitch letter with a tele-
phone and fax numbers. phone call. If you leave a business to a current event or
questions should be mentioned in
Separate TV, radio and message on voice mail trend. Does your product or
order of importance to the story to save print sources. Know the and the reporter does not
beats covered by differ- call you back, call again
service somehow relate to the
the editor time and space. Olympics, the presidential
ent reporters so you can until you get him or her
Don’t embellish or hype the informa- be sure to pitch your on the phone. Do not election, the environment, the
ideas to the appropriate leave a second message
tion. Remember, you are not writing
person. within five days of the hot movie of the moment?
the article; you are merely presenting ➎ Develop story angles first. If the reporter re- Whether you’re planning a
you’d want to read in the quests additional infor- special event or just sending a
the information and showing why it
newspaper or see on tel- mation, send it immedi-
is relevant to that publication. Pay evision. Keeping in mind ately and follow up to press release, you can gain
the media you are ap- confirm receipt. publicity by association.
attention to grammar and spelling.
proaching, make a list of
Competition for publicity is intense, ideas you can pitch to SPECIAL EVENTS
them. While the number of
and a press release full of typos or
If you own a clothing special event ideas is infinite, some general categories exist, such as:
errors is more likely to get tossed aside. store, for example, you ❶ Grand openings: You’re excited about opening your new
could alert the local me- business. Everyone else will be, too . . . right? Wrong. You have to
Some business owners use gimmicks
dia to a fashion trend in create the excitement, and a knockout grand opening celebration is
to get their press releases noticed. In your area. What’s flying the way to do it. Your event has to scream “We’re better than, differ-
out of your store so fast ent from and more eager to serve you than our competitors. We
most cases, this is a waste of money. If
you can’t keep it in want to get to know you and have you do business with us.”
your release is well-written and rele- stock? If it’s shirts featur- Be original. If you own an electronics store, open your doors
ing the American flag, with a remote control. If you’re opening a yarn store, unravel a
vant, you don’t need singing telegrams
you could talk to the huge knitted ribbon. If you sell sporting goods, reel in both ends of
or a bouquet of flowers to get your media about the return an enormous bow until it is untied. Whatever your specialty, do
of patriotism. Then something unusual, entertaining and memorable.
message across.
arrange for a reporter to Also, think about other activities that go along with your grand
If you have the money to invest, you speak with some of your opening. Design a terrific invitation, do plenty of publicizing, pro-
customers about why vide refreshments and entertainment, select a giveaway that pro-
may want to try sending out a press kit.
they purchased that par- motes your business (and draws people into the store to get it), and
This consists of a folder containing a ticular shirt. Suggest the incorporate ways of tracking who attended your event (contest en-
newspaper send a pho-
cover letter, press release, your busi-
tographer to take picture
ness card, and photos of your product of your customers wear-
ing the shirts.
or location. You can also include other
❻ Make the pitch. Put
information that will convince reporters your thoughts on paper
and send a “pitch letter”
your business is newsworthy: reprints
to the reporter. Start
of articles other publications have with a question or an in-
teresting fact relating
written about your business, product
your business to the tar-
reviews, or background information get medium’s audience.
For instance, if you were
on the company and its principals. If
writing for a magazine
you do choose to send out a press kit, aimed at older people,
you could start off with:
make sure it is sharp and professional-
“Did you know over half
looking, and that all its graphic ele- of women age 50 and
older have not begun
ments tie in with your company’s logo
saving for retirement?”
and image. Then lead into your
pitch: “As a certified fi-
nancial planner, I can offer your readers 20 tips to start them on the
road to a financially comfortable retirement.” Make your letter no
longer than one page, and include your telephone number so the
reporter can contact you.
If appropriate, include a press release with your letter (see “Meet
the Press” on page 11). Be sure to include your positioning state-
ment in any correspondence or press releases you send.
❼ Follow up. Following up is the key to securing coverage. Wait
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SMART TIP try forms, free newsletter can attend almost any
subscriptions and so on). organization’s meetings a YOU’RE THE
After you’ve finished talking to new
❷ Holidays and seasons: few times before you EXPERT
people at a networking event, take a Some of the most com- must join. This is
As an entrepreneur, it’s your respon-
mon and easily devel- another way to stretch
few seconds to jot down some pertinent
oped special events are yourself and make a new sibility to get your business noticed—
information on the back of each con- based on holidays. For set of contacts.
which means you’ve got to toot your
example, during the ❸ Carry business cards
tact’s business card.This can be anything
Christmas season, Santa’s everywhere. You never own horn. You need to let others know
from their business’s biggest problem Workshop can be found know when you might
that you exist and that you are an
in thousands of commu- meet a key contact, and
to the college their son or daughter
nities, not just the North if you don’t have your expert source of information about
attends—whatever will give you a per- Pole. Or kick off the cards, you lose. Take
your industry.
summer with a Beach your cards to the gym,
sonalized “hook” to follow up with when
Boys music marathon. parties, the grocery store, •Start by making sure you know every-
you call later on. When planning an even when you’re walk-
thing you can about your business,
event tied to a holiday, ing the dog.
make originality your motto. If the average December temperature ❹ Don’t make a beeline product and industry.
in your city is a balmy 76 degrees, take a cue from your locale: Put for your seat. Take ad-
•Contact experts in the field and ask
antlers on pink flamingos and dress Santa in shorts and sunglasses. vantage of networking
❸ Co-sponsoring: Partner with complementary businesses to host time before you have to them how they became experts.
an event, or you can take part as a sponsor of an established charity sit down. Once the
or public cause. Keep in meeting starts, you won’t •Talk to as many groups as possible.
mind, however, that not be able to mingle. Volunteer to talk to key organizations,
Bright Idea every event is right for ➎ Don’t sit by people
service clubs and business groups free
every business. you know. Mealtime is a
Sending out publicity pho- Think about how your prime time for meeting of charge.
tos with your press release company can benefit an people. You may be in
•Contact industry publications and vol-
or kit? Make them fun, dif- event. If you’re a florist, that seat for hours, so
you could provide flow- don’t limit your opportu- unteer to write articles, opinion pieces
ferent and exciting. Editors ers for charity luncheons nities by sitting with
and reporters see thousands or columns. (If you can’t do that, write
or galas. Whatever you friends. Remember,
of dull, sitting-at-the-desk do, be sure to promote it you’re spending precious a letter to the editor.)
photos every year. Think of a with press releases or a time and money to
•Offer seminars or demonstrations
mention in the event’s attend this event.
creative way to showcase program. ❻ Get active. People re- related to your business.
something photogenic ❹ Games and contests: member and do business
•Host (or be a guest on) a local radio
about your business . . . and From naming a mascot with leaders. Don’t just
make it stand out from the to guessing the number warm a chair; join a or TV talk show.
of jelly beans in a jar, committee or become a
pack. contests attract attention. board member. If you Do all this and, by the time you con-
But they pay off only don’t have time for tact media people and present your-
when properly promoted that, volunteer to
self as an expert, you’ll have plenty
and ethically managed. So be sure your prizes are first-rate and that help with hospitality
you get the word out in a timely and professional manner. at the door or with of credentials.
checking people in. This
NETWORKING gives you a great reason to talk to others, gets you involved in the
The ability to network is a crucial skill any start-up entrepreneur inner workings of the group, and provides you with more visibility.
must have. How else will you meet the clients and contacts neces- ❼ Be friendly and approachable. Make people feel welcome. Find
sary to grow your business? out what brought them there and see if there is any way you can
The trick with networking is to be proactive. This means taking help them. Introduce them to others, make business suggestions or
control of the situation instead of just reacting to it. Networking re- give them a referral. What goes around comes around. If you make
quires going beyond your comfort zone and challenging yourself. the effort to help others, you’ll find people helping you.
Try these tips: ➑ Set a goal for what you expect from each meeting. Your goals
❶ Set a goal to meet five (or more) new people at each event. can vary from meeting to meeting. Examples include learning about
Whenever you attend a group, whether a party, mixer or industry the speaker’s topic, looking for new prospects, discovering industry
luncheon, make a point trends or connecting with peers. If you
of heading straight for work from home, you may find your
people you don’t know. Bright Idea purpose is simply to get out and talk
Greet newcomers (they’ll to people face to face.
love you for it!). If you
Capitalize on old-fashioned publicity stunts. No, you ➒ Be willing to give to receive.
don’t make this goal a don’t have to swallow goldfish or sit atop a telephone Networking is a two-way street. Don’t
habit, you’ll naturally pole, but consider the landscaping company whose pre- expect new contacts to shower you with
gravitate toward the cision lawn-mowing team shows off its fancy footwork referrals and business unless you’re
same old acquaintances. equally generous. Follow up on contacts;
❷ Try one or two new
in local parades. keep in touch with them; and share in-
groups per month. You formation that might benefit them.
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THE WORLD
WIDE WAIT
Have you tried to visit a Web site and
waited . . . and waited until something
appeared on your screen? Industry
gurus say that people won’t wait more
than 8 or 10 seconds for a site to load,
but blame loading delays only par-
tially on poor Web site design. Your
customers’ modem speed (or lack of it)
can create the log jam as well.
The vast majority of computer users
connect via dial-up access using a
traditional analog modem. The mo-
dem converts digital signals from your
computer into analog frequencies for
outgoing data, and vice versa, at 56Kbps
or lower, though 56Kbps is currently the
standard.
When your customers dial to con-
Net Works
Setting up your company Web site
nect to the ISP, the modem contacts
WHY PUT your business Register.com because, like similar services, it tells you if the name
the phone line, which, in turn, contacts
online? Because the Net you have chosen is taken, but it goes a step further by offering a list
the ISP and, voila, they’re connected. enlarges your business’s of alternative names that are still available. From the available
realm of possibilities. It names, choose one that is the easiest to spell and remember.
Make sure your Web site can be loaded
allows you to communi- With your name established, you must make sure you’ve done
in seconds with a 56Kbps modem. cate with anyone any- everything offline to tell people about it. Every piece of paper
where (or thousands of should have your Web address on it, including business cards,
Slow modems and graphics overload
people at once) with brochures, letterhead, invoices, press releases and advertisements.
Continued on page 15 e-mail. You can search
for information from millions of sources covering every subject un- WEB SITE BASICS SMART TIP
der the sun. Advertising your product or service, showing potential Now you’re ready for designing and
Banks, credit card issuers,
customers your wares and allowing them to purchase immediately, building your Web site. What makes a
doing test marketing, joining discussion groups with like-minded good Web site? Before getting en- airlines and office sup-
individuals, sending a monthly newsletter to customers, and linking meshed in design details, get the big
ply stores cut deals with
with affiliated vendors are all part of what you can do with the picture by writing a site outline. It’s a
Web. So the question isn’t “if” you should embrace it but “how?” misconception that you have to throw Internet-based partners,
big dollars at an e-commerce solution.
including Web designers
THE NAME GAME You just have to be a careful shopper
Your first to-do item is to make a list of possible Web site names. for vendors. Having a detailed outline who offer value-added
Then run, do not walk, to the nearest computer, log on to the Inter- makes the process more efficient. A site
services to their small-
net, go to your favorite search engine and type in “domain registra- outline should include five key areas.
tion.” For a modest fee (about $35), you will find a list of compa- ❶ Content: The key to a successful business customers. Be on
nies such as www.networksolutions.com that will guide you Web site is content. Give your site visi-
the lookout for valuable
through domain registration. One site that’s particularly helpful is tors lots of interesting information,
incentives to visit and buy, and ways to freebies.
contact you. Once your company’s site
Bright Idea is up and running, continually update and add fresh content to
keep potential and existing customers coming back for more.
Although people have gotten increasingly comfort- ❷ Structure: Next, structure your site. Decide how many pages to
able with the Net as a secure place for credit card have and how they will be linked to each other. Choose graphics
information, a little reassurance doesn’t hurt. Have and icons that enhance the content.
whoever sets up your shopping cart program pro- Now organize the content into a script. Your script is the num-
bered pages that outline the site’s content and how pages flow from
vide a message to customers detailing your firm’s one to the next. Page one is your home page, the first page that site
policy on protecting their credit card information. visitors will see when they type in your URL. Arrange the icons de-
picting major content areas in the order you want them. Pages two
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2 4 4 5 M c C A B E W AY
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