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Steps for start-ups - Coggle Diagram
Steps for start-ups
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5. Raising the finance
Money must be raise to get started and to support until it can sustain operations from profits, which can take years (as cash requirement may be bigger than profits).
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When someone provides equity capital, it means that person is partial owner.
Most entrepreneurs (who start the business) might not want to loss control, so some capital will be in form of investment (selling shares), other might be loans.
6. Testing the market
Launch the business, carry this questions...
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Some types of business, mostly capital-intensive manufacturing, initial launch is extremely expensive and the firm can respond to market reaction in limite and slow way.
Other types (like restaurants), often respond quickly and easily.
The purpose of testing is to verify that the business idea will be received well by consumers to suggest if it has a reasonable chance of success.
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3. Planning the business
Once the concept is narrowed, it should be write a business plan.
Business plan: document that address all the issues that need to be planned before operations begin.
It would be use to multiple stakeholders, also potential owners and financial institutions that may provide capital.
Its composition requires the entrepreneur to think through specific elements of how the business will operate.
For investors the plan provide confidence as it indicates the foreseen of potential issues and how are trying to be addressed.