Want To Start Your Own Business? Here are 10 Words To Think About First

Pedestrian’s teamed up with Telstra’s Imaginarium to help you solve some of your biggest problems. If you want the chance to bring a unique idea to life alongside like-minded people and access training, workshops and industry mentors (including the founders of Pedestrian.TV), simply tell Telstra about a problem you’d like to solve for the youth of today over at the Imaginarium site. Applications close in a few weeks so enter now!

A decade into the Pedestrian story, the emotions and experiences of our initial launch period are still fresh in our minds.
Tapping into hundreds of entrepreneurs’ start-up stories, including our own, we’d like to present a kind of entrepreneurial crib notes.
Here’s 10 words you need to think about before you launch your own venture, and why they need to become part of your lexicon, by Pedestrian’s co-founder Chris Wirashna
You need to have confidence if you want to succeed in anything. But, if you’re looking to start your own venture then you’re going to have to ‘sell’ something to someone. What customers are buying more than anything when they hand over their money is ‘confidence.’ They’re buying the ‘confidence’ that your product/service will fulfil its goal and help them achieve their outcomes. You need to back yourself 100% that what you’re about to jump into is something that you will have the personal confidence to deliver better than anyone else. 

When we started Pedestrian, we were in our early 20s selling youth culture expertise to people often much older than us. We backed ourselves that we knew how to connect to this audience better than anyone. As you scale up, your brand will have to start doing the selling for you and you want it to become synonymous with the confidence you’re required to deliver. 
What makes your product or service unique? It doesn’t mean that it can’t have competitors or be in an established industry; it just means that you need to have something that sets you apart.

Perhaps you’re offering better performance like Google did when it took on Yahoo in the early days of internet search, or you want to become a leader in catering to a specific niche or audience. If you can create something wholly new and innovative that’s able to be protected by a patent, then even better. 

Around 12 months ago, I read the book Zero to One by PayPal founder and billionaire investor Peter Thiel and there was a section of the book that completely blew my mind and has stayed with me ever since. It spoke about pricing and the dreaded “Dead Zone.” 
image via: Zero to One by Peter Thiel
In summary, it discussed the different marketing and sales efforts required to sell products of various sizes.
What struck me most was the “Dead Zone” of products between $1,000 to $10,000. While his analysis is skewed toward the tech services industry, Thiel highlights that at this sale level it’s too high for customers to purchase an unknown product without a face-to-face sales person, however the sales price is not high enough to justify a sales rep.
After reading this I personally thought back to products and businesses that I’d loved which ultimately failed because they were selling a service that fell in the ‘Dead Zone.’ 
Thinking realistically about how you’re going to price and sell your product can be the difference between life and death for your venture. 
I’ve been lucky enough to have a solid business partner throughout the 10 years of launching Pedestrian. It’s not always easy but when you look at most successful start-ups, more than one founder is a common theme, because MANY HANDS. 

But make sure you’re sensible with who you bring on. If there are any red-flags in the early days then these are only going to be exasperated when things start heating up. Ensure you have a shared vision, a common work ethic and similar expectations for the new enterprise.
This really should say, ‘Quarter it and Double it’. As a general rule founders tend to be overly ambitious with their initial forecasts for their business. As a rule, take your first forecast and quarter all of the revenue expectations and double the associated costs. If you can still keep things afloat with that adjustment then you’ll probably have a more realistic view of what your first 12 months will look like. Things will almost always be harder than what you imagine. 
It’s not uncommon for founders to be incredibly secretive of their ideas when they’re first launching a business. Many are too scared to mention them to anyone afraid that someone will rip them off. As a result, they often miss out on the assistance, advice and feedback that could have come to them from others if they were more generous with speaking about what they’re looking to create. It may surprise you, but very few people in the history of the world have ever quit what they were doing in life to rip off someone’s unproved idea.
In the current landscape of multi-million dollar funding and burn rates supposedly being the norm it’s easy to forget that the fundamental goal to creating a sustainable business is making a profit (or, in the case of a social enterprise, enough money to keep delivering whatever benefit you’re looking to generate) Ultimately, any business that can generate a profit early in its existence is going to be in the enviable position of choosing whether or not it requires outside investment and will have more power in setting terms to those that may be interested in investing.

Closely related to ‘Profit’; when you’re in start-up mode, everyone will forgive you for being ‘tight’ with money. Every dollar you save is another dollar you’ll have to keep your business alive.

Much like Amazon and its desks made of doors, when Pedestrian started we used to make desks out of two trestles and wood cut directly from a hardware store. There weren’t too many complaints and it created a culture of thriftiness throughout the business. We even sold the makeshift desks on eBay after we graduated to legit desks a few years later.

If you’re looking to start an internet based business, your cost per acquisition of new users should be something you dream about at night. 
Ultimately, it’s the most vital piece of the puzzle for any online business: how can I spend money to acquire customers for less money than I make from them?
Very few organisations end up looking exactly the way the founders dreamt they would. Even game-changers like YouTube, Twitter and Slack were evolutions or offshoots from the original plan.

Successful pivots happen because founders are flexible and constantly listening and reacting to what the market is telling them. The first 12 months to 3 years of any business is a glorified research and development phase. Pedestrian originally set out to create a globally distributed DVD street press before settling on the Pedestrian.TV website as the most effective way for us to deliver our goals.

If you’re inspired but aren’t sure where to start, hop on to the Telstra Imaginarium site now to sign up for the opportunity to receive funding and access to training, workshops and industry mentors. Apply now!