Startups are young companies that are born to bring a change in the market.
This change can be a new product or service, or an innovation in the existing industry.
If you are planning to start a startup one major thing that needs to be understood is the terms and concepts that are the ingredients of a startup.
1. Team
A business organization is nothing without its people.
Founder
Founders are the foundation of any business organization.
For instance, the co-founders Deepinder and Pankaj saw queues of people outside restaurants during lunchtime, and Zomato came into existence.
Co-founder
If a founder sets up a company with other people, they are both a founder and a co-founder. Let’s use Google to illustrate. So, Larry Page is not only Google’s founder, but also a co-founder with Sergey Brin. Cofounder is a term that exists to give equal credit to multiple people who start a business together generally from the beginning.
A cofounder may be part of the vision of a startup from the get-go, or they may be brought on very early by the original founder because they have skills the founder is lacking. For example, the founder may have design skills, but no engineering skills. In that case, it greatly benefits them to bring on a technical cofounder early in the process of launching their startup. But it’s not always easy to find cofounders that are right for the business model or that will truly aid in the company’s success.
Creators
Within a startup, creators are the essential parts that give a voice, personality, and humanity to the brand.
They perform the roles like writing scripts for an advertisement to designing logos for the company, and creators take up a vast plethora of roles.
Operation Specialists
Operation specialists keep the wheels of the company running day in and day out.
This includes roles that are specialized in operations like sales, customer service, human resource management, marketing, business development, and more.
2. Business and Financing
In any business organization, execution is necessary.
Validation
Business ideas aren’t worth it if they don’t solve a problem for a specific set of people.
The idea behind the validation is to simplify the process of food ordering.
There is a requirement for validation when a solution for a particular pain point is verified to be useful by the market.
MVP
The role of the founders is to execute the idea by using their company’s private online portal and adding values to the repository.
They have the desire to watch if people would be interested in using the portal to browse. As a result, the traffic over the browse increased.
MVP or Minimal Viable Product is the usable prototype for the first target customers to fulfil a requirement.
Pitch Deck
The entrepreneur stands in front of 5 seasoned investors and gives a brief about their startup.
The process is termed pitching. Pitching is performed to appeal to investors with the goal of receiving financing from them.
A Pitch Deck is a presentation consisting of a brief summary, scalability, team, and market of the startup.
Valuation
Certain startup ideas seem profitable, and some ideas may not have a lot of growth potential over life.
Valuation is the process of quantifying the worth of the startup operations.
The determination of this figure is crucial as it determines the amount of capital the investor will give and their ownership stake in the company.
3. Marketing
It is the art of creating value.
Target Market
If there is a startup that belongs to mental health and has an objective to make therapy accessible, it cannot possibly include everyone as its market.
This simply states that it cannot cater to middle-aged people, school-going kids, or young corporate customers.
Inbound Marketing
The followers of certain brand pages on social media find the content, advertisement design, and other valuable products.
From Instagram’s aesthetics to LinkedIn posts, inbound marketing follows the objective to create a lasting relationship with potential consumers.
Everything is done through strategies for attraction, engagement, and providing solutions.
Outbound Marketing
While inbound marketing tends to build organic relationships with consumers, outbound marketing pushes the message in the general direction of the public.
Outbound marketing is done through email spam, cold calling, billboard ads, pop-up ads, and more.
Growth Hacking
From determining the facts about when to use buzzwords in the ad copy, growth hacking is required.
Market Sizing
Market sizing is crucial for all making the decisions of the entire business organization.
The size of the market determines the company’s profit and investment amount in the long run. It includes questions like – who is going to use the product, for how much duration, and how many times?
The buyers of a particular product or users of a service are estimated by the utilization of certain methods and procedures.
4. Legal
Legal forms make things formal.
Co-Founder Agreements
In any business, there is more than one founder.
The co-founder agreement establishes working coordination among the founders so that they can prevent future disputes and safeguard conflict resolution.
It contains comprehensive clauses to describe the working relationship between the founders and outlines the basic communication.
Trademark
The registration of a trademark is essential on its own.
It guarantees exclusive ownership to the brand to use the logo, brand name, slogan, packaging, and more things that make the brand unique.
Non – Disclosure Agreement
Any party that has access to the startup’s private information is given an NDA to protect that information.
This can be handed over to clients, investors, and employees. It specifies what constitutes confidential information, who owns that information, the time range of confidentiality, and more.
Intellectual Property Rights Agreement
Intellectual property is inclusive of confidential material like business development plans, new products, invention ideas, authorships, branding information, and more.
Having complete ownership of all the IPs is crucial for any startup.
Term Sheet
A term sheet, which outlines the fundamental terms of an investment, is a non-binding agreement between parties. The term sheet serves as the model and foundation for intricate, legally significant papers. A binding agreement or contract to the terms of the term sheet is drawn out if the parties concerned reach an understanding of the details.
A term sheet should, in essence, summarize the key points of an agreement without getting into the nitty-gritty details and contingencies covered by a legally enforceable contract. It also ensures no unnecessary, high-cost legal fees are associated with drafting a legally enforceable agreement or contract.
5. Technical
A/B Testing
At the time of landing on a website, you might see a template pop up seeking permission for your email-id.
The majority of websites follow this protocol of popping a massage after you open the page.
A/B testing has proved to be effective in seeking emails from potential clients.
Stack
To launch a functional application- app/website programmers create a tech stack.
It includes everything that is required to kickstart the operation, from the programming language, frameworks, and tools, to databases.
QA and QC
Quality Assurance or QA is a roadmap that is created by a team of experts and consultants for high-quality products.
If the QA protocol is followed by the designated teams, then the overall quality of the products or services is ensured by the team of experts.
Quality Control, on QC, involves testing the product or service post its release to ensure that the efficacy is consistently maintained.
Conclusion
The creation of building the startup is not as complex as they look from afar. In fact, an understanding of the basics instils a sense of confidence in individuals with an idea.
A masterful execution occurs only when theory is tested.
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