Danielle Tate, CEO of MissNowMrs.com, a multimillion dollar online name change service for brides, has added author to her resume with her first book, Elegant Entrepreneur: The Female Founder’s Guide to Starting and Growing Your First Company. She shares her insights for HBM’s savvy women entrepreneurs on how to start and grow a business.
- How do I know if my idea is worth building a business around?
The success of an idea is typically connected to how innovative it is as well as the size of the market it would impact. Consider the following questions as you evaluate the how innovative your business idea:
Is my idea easily copied by an existing company or added to an existing product?
Is my idea compelling enough for consumers to switch to using it?
Is my idea innovative enough to provide increase levels of satisfaction and increase market demand?
If you answered “yes” to each of those questions, you have a truly innovative idea and should do market research to understand how many people experience the problem you are solving and how much they are willing to pay for a solution. Determining the size of your market is important when evaluating your idea. Small markets may seem easier to enter, but the smaller the number of customers you can sell to, the harder you will have to work to make a profit.
- How do I do market research effectively and inexpensively?
Market research can seem overwhelming, but it is essential to know whether your idea is worth your valuable time and money. The first step is to formulate specific questions about your idea. Is your idea or product the result of a problem or pain that you faced? How painful and frequent is that frustrating problem? Is it something that someone would pay any amount of money to never repeat, or is something that is annoying but livable? The answers to these questions play into how much you will be able to charge for your solution. How much you can charge, and in turn profit from supplying your solution are key variables in whether you should consider building your idea into a business
The next step in market research is determining exactly who your potential customers are. Once you have identified the demographic most likely to use your idea or product, ask your questions of strangers in that demographic. You can go to a place where your potential customers frequent and ask them to evaluate your product or take a quick oral survey. Consider offering a $5 gift card for participation. Ask specific questions about the problem you are solving and request feedback about the pros and cons. Ask each person how your idea relates to their problem and how much they would pay for it and record their responses. After you gather initial in-person feedback, you can create a survey in Google Forms or with a service like SurveyMonkey to gather more data around your idea. What do you do if you do not have access to people who experience your problem? You can use a company like AskYourTargetMarket to survey their 25 million respondents. It is a quick and inexpensive way to begin learning about your target users and what they want.
- Do I need to write a business plan to launch a successful company?
Would you take off on a trip to a country you had never visited without a map and itinerary? Hopefully not. Starting a business is very much a journey, and advanced planning is necessary. There are three main models for planning the success of your business: a pitch deck, a business canvas, and the traditional business plan. As every idea and business is different, it is important to select the option or options that best suit your situation. The vital thing is to create a plan.
Planning is invaluable, even in the constantly-changing world of business. As your idea changes and evolves, the exercise of mapping and recording your steps to launch is important. You will reap the benefits of understanding your market, your mission, your competitors, and how to reach your end goal. You will also identify problems and will create solutions well before you encounter them in the market.
- When is the right time to leave my job and focus on my business full-time?
It is tempting in the excitement of early entrepreneurship, to immediately quit your day job and dedicate yourself to making your dreams a reality. Don’t do it!
A reality check is critical when timing your leap into a new business. It is crucial to assess your current situation and take an honest look at yourself and your circumstances. How much money do you have in the bank? How much is your current lease or mortgage? Are you in the midst of a marriage, divorce, or starting a family? Are you locked in an employment agreement? While conditions will never be “perfect” for starting a business, all of these factors should be weighed in the timing of your launch.
The opportunity for your idea has the most impact on the timing of starting your company. If your opportunity emanates from a personal passion or a gap that you see in a market, you have more flexibility regarding when you start your company and commit to it full time. If the opportunity for your idea is skyrocketing, you will need to jump into the launch of your company as quickly as possible to beat competitors to the top of the market. A word of caution: ideas are very exciting and it typically feels like they are all tied to exploding opportunities, so take the time to discuss your idea logically with individuals familiar with the market you would be entering.
Knowing your ideal personal, professional and market scenarios before you make your decision to leap into your business will help you make the best possible choice for yourself and your company’s future. Be brutally honest as you evaluate what you want, what you need to successfully launch, and how you feel about the upsides and downsides of your business idea. You will need to be fully committed to your vision and goals as you take the leap into entrepreneurship.
- What would you have done differently if you could go back to when you started MissNowMrs.com?
I would have “owned” my role and an entrepreneur much earlier, and used that confidence to secure industry partnerships and press coverage faster. My background in sales gave me the skills to sell a great product, but I felt MissNowMrs had to have large customer numbers and conversion statistics to be qualified to approach large partners. In reality, the idea for an online name-change service was a great one, and my service was a revenue-generating add-on for partners both small and large.
