Creating a Startup In 2022 – Latest Guide

Welcome To Blogger Uche , In this article we’ll be going through the most detailed guide on launching a tech startup in 2022 . I have conducted a lot of research for this and from experience I will detail the problems people face , explain some terms you should know as well. Thank you for visiting bloggeruche.com 🙂

What Is A StartUp ?

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A startup company is a newly formed business with particular momentum behind it based on perceived demand for its product or service. With intentions to grow rapidly as a result of offering something that addresses a particular market gap. At its initial stages of business founders normally finance their startups and may attempt to attract outside investment before they get off the ground. Funding sources include family and friends, venture capitalists, crowdfunding, and loans I will be explaining this funding sources meaning soon. Read on 🌝

Types Of Startups ?

I’ll explain the different types of startups in the briefest way:

Small business startups – these startups are small business ideas like your mom’s shop . example of this can be a dry cleaning shop.

Buyable startups – this is a very unique type of a startup their founders tend to grow them widely and 75% of these startups are in the tech and software niche . You’ve seen or heard scenarios where a bigger player company acquires a smaller one for millions of dollars if not billions in some cases. sweet money right ? 😏 But building a product worth billions isn’t going to take feebleness lol 😂. Buyable startups build to be bought , that’s their behind the scene aim 🤌 an example for this kind of startup is Sumly app .

Scalable startups – this in most cases can refer to some product or business apps. the moment they are able to reach a particular user threshold they’ll be able to scale through mostly by taking funding from angel investors , family members or and friends. example of this type of startup would be Facebook in 2004.

Offshoot startups – this is simply startups that branch off from their parent companies . they are not built from the ground up they are offshoots of their parent company.

Social startups – 90% of startups today are money oriented and growth obsessed ! but social startups are quite different from them . social startups tend to solve problems but not for profit ! example of this kind of startup would be code.org a startup created to create a more tech educated community.

Some Startups Niches :

•Software (SaaS) and technology
•Marketing and advertising
•Healthcare
•IT
•Insurance
•Education
•Real estate
•Environmental and energy
•Retail and ecommerce
•Blockchain and cryptocurrencies

What You Should Consider Before Launching A Startup:

You don’t just randomly create any startup because you wish to ! there are hundreds of thousands of startups or millions of startups on the United States but studies show that 97% of these startups crashes before they even start. only 1.5% make it up to 10yrs as a successful business . This shows that there are some challenges most startups face which are ;

Below are some factors that affects Startups :

• No Market Need
• Running Out Of Cash
• Not The Right Team
• Get Outcompeted
• Pricing/Cost Issues
• Poor Product
• Need/Lack Business Model
• Poor Marketing
• Ignore Customers
• Products Mis-timed
• Lose Focus
• Disharmony On team/investors
• Pivot Gone Bad
• Lack Passion
• Bad Location
• No Financing/Investors Interested
• Legal Challenges
• Don’t use network/advisors
• Burn Out
• Fail to pivot

Taking a close look at the above you’d understand the challenges most startups go through , technically all startups face 30% of the above listed issues but they are able to scale if they get things right. When I started exedox the first challenge I had was building a reliable team , a team that has the vision and dream , the team is the most essential part of your startup . Having a good team structure helps you balance and gives the public an impression of professionalism. So my personal opinion for you is to build your team. You might be wondering what , why and how you can build your team 😏don’t worry blogger uche got you covered 😌 , Read on .

What You Should Have In Place To Run A Start Up

Building Your Team

One Thing A Startup must get right first is the team , the team structure matters a lot . Most startups today die because they lack basic understanding of their team structure, the good news is that if you are planning to or lead a startup then you are at the right spot. I’ll guide you through how to position your startup for productivity . A vast majority of startups doesn’t understand that a clear org chart drives a company to success. Having so many unproductive people on your team can quench your progress or dim the possibilities of soaring very high. As a startup founder you should understand that getting the right structure for your startup is extremely important for increased productivity, proper communication, and smooth workflow.

Roles In A Startup

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Basically, The founder or CEO role is inevitable and oversees the effective flow of marketing and sales, legal issues, human resources, management, and supervising the CTO. The CTO is the Chief Technology Officer , whose role covers certain areas of responsibility, they include managing the UX team, Backend team, DevOps team, and QA team. So In a startup there should be interoperability, the different teams should do only what’s concerns their sector so that progress goes smoothly.

UI/UX Team

This arm is something a tech startup can’t do without! without professional hands on this sector you likely would not be able to make a product that sells. The User experience is something that contributes to the product’s success . A nice design and experience says a lot about your first time experience, having professional hands are people who carry out real research on product design to bring out something that works for the product type . This sector is very vital and you should be ready to spend more resources building this sector in your startup team. Although in most cases you might only need one to two very committed UI/UX designers but when you have the financial or social prowess to recruit plenty hands then this are the roles that can be made available on the UI/UX team on your startup.

Leader – should someone who has shown 100% interest for your project and runs with your vision . He/she oversees the UI/UX team and places activities ongoing for productivity.

UX researcher – like I stated you can’t just start designing something, you need to carry out a market research , what does your target audience want ? how easy should the app be and tons more , the UX researcher handles this by conducting research to communicate with the UI/UX design team .

UX designer – User Experience sells your app! you need someone who has strong hands into this . someone who would carefully create a workflow that sells your product . although most designers this days are fond of creating very hard to build designs lmaoo 😂.

note : the frontend developers should be able to work with the released UI/UX designs.

Requirements: The designers should have a working laptop , should understand how to use figma , should understand colors and modern design concepts. They must be literates and patient as well 😂 .

Tip: please when giving design ideas to your design team make sure to have thoroughly thought through it before they start , it’s quite frustrating telling them to add or remove so and so or start all over. I’ve had such experience with my own design team and it wasn’t very cool 😂.

So In brief each member of the UI / UX design team has their own responsibilities. The UX researcher analyzes user behavior, draws up a detailed report, then submits it to the UX designer who creates layouts taking into account all the user desires. The role of a researcher should not be neglected because he help in creating the design that will win the hearts of users and will contribute to the success of the product . Designers collaborate with developers who create the required interface, and the team leader organizes and coordinates their work.

Frontend Team

In modern technology today we have frameworks , languages that can enable a front end developer be a full stack developer but regardless of the most 🌝 The Front End team should be there , these people implement the design concept from the UI/UX designers . They actually create the real experience! or rather , they bring into life what the UI designers conceived !

The Frontend Team is a smooth table and doesn’t have much hurdles but regardless their are things you should ensure they know :

Requirements: They should be able to work with HTML, CSS , Vanilla JavaScript , this is only but a pass mark but for a startup your frontend developers should be equipped with knowledge of modern frameworks and Technologies like React.js , Typescript , Chakra UI , Next.js , Vue.js , Bootstrap and so much more…

Tip: I’d advise you to understand software development yourself 😏 it’s a great addition to know what stacks are and can work on your own projects. Regardless of the most 🤌 guide yourself with this article .

Backend Team

This team is the core of the entire organization as it is responsible for the application logic, efficient code, and data structure. Engineers are engaged in coding, improving algorithms and application logic, but for the interaction between the back-end and the front-end sides, it is necessary to involve middle-stack developers. They handle cleaning user input, rest API endpoints, etc. Thus, developers will be able to focus on performing their job efficiently, without being distracted by third-party issues. All these issues will be handled by middle-stack developers. As in any other team, there is also a leader who organizes the workflow, assigns the tasks, and coordinates the work of all team members.

Requirements: Understanding of databases, node.js , express.js , Nosql 🌝 , SQL , firebase , docker , postman , APIs e.t.c

Tips : don’t just rush into launching your product , conduct a deeper research on what technologies your product will use . what backend technology are you going to use ? firebase or mongodb ? The costs ? Your Milestones ? and so much more…

DevOps Team

DevOps team provides a flawless user experience, ensures the product goes to market, tests new versions of the product, and also manages the cloud infrastructure. Often, this team consists of a cloud architect, system administrator, site reliability engineer, and team lead.

The main task of a cloud architect is the creation and management of the cloud infrastructure; the site reliability engineer ensures the smooth operation of all necessary systems, the system administrator is responsible for maintaining the cloud, and the team lead distributes tasks and responsibilities within the team and controls the workflow.

Graphics Designers

This Team shouldn’t be underrated ! Yes you need graphic designers , they’d manage the creating of social media banners & fliers , logos , brand designs , animated videos and lots more . This team creates what people’s see in your brand! without a smooth graphic designs you may likely grow very slowly…

Requirements: 😏 find cool graphic designers 🌝 .

Tips: your terms with your designers matters.

Marketing team

Marketing experts promote your product and create an overarching image to portray your organization in a positive light they will work with the graphic designs team. Typical responsibilities of a marketing team involve the following:

-It is engaged in brand management.
-Runs a marketing initiative campaign, identifies the core services or products for which sales cycles are launched.
-Creates content that promotes your service or product.
-Optimizes your organization’s website, creates content, and updates it regularly.
-Monitors and manages your brand’s social handles
-Organizes and manages internal communication.
-Collaborates with the graphic designs team.
-Coordinates the work of third parties providing marketing support. For example, advertising and PR agencies, web providers.

Human Resources Team

This Part Should Be Very Precious to your startup , they handle the task of hiring new team mates and relating the vision to them. the following are some tasks they carry out:

Hiring employees

HR managers create accurate job titles and descriptions, conduct structures interviews, deal with legal issues, for example, various labor laws.

Developing and retaining employees

Professional employees are crucial for business growth, that is why HR managers utilize various techniques to make sure your workers develop and work together to drive your startup to success. So, managers provide various benefits and fair compensations to workers, contribute to management training, create a favorable and strong workplace culture, and cultivate career paths once your startup grows.

Legal Team

This team makes sure your startup operates within the law. Thus, experts handle various business issues: tax planning, intellectual property issues, various arrangements, employment contracts, litigation.

How to Build a Startup Team?

There are various ways to form your team, and each of them depends on your priorities and goals. You can build your own in-house team, go for partial outsourcing, or choose complete outsourcing (a great option for lean startups). We will give an overview of these ways to help you make your choice.

Full in-house team

This option allows you to easily manage a team, but keep in mind that in this case, additional costs await you: taxes, salary payments, operating costs.

Partial outsourcing/staff augmentation

This model allows you to save money on the development, as it offers the ability to outsource work on certain tasks to third parties or expand an existing team.

Complete outsourcing/dedicated development team
When using this model, you can significantly save money, since it allows you to hire a special team to perform all tasks.

What’s In for your team members?

From my experience this is one of the most challenging part of building a startup ! when you know you can’t do it alone and try reaching out to specialized hands to join and they ask you ‘ what’s in for me?’ . jeez 🥶 to be honest in most cases If your product is a genius idea and they love it they’d contribute to it but when it’s just ‘like most startups’ then they tend to ask what’s their profit. Now let me tell you , its not a great idea to talk about shares when you don’t even have an MVP 😏 yeah , Ahmed Bankole taught me that 😌 , you shouldn’t indulge in any thing that can cost you resources in the future ! So in this case what do you do ? it depends and it’s not entirely predictable , you absolutely can’t tell how people react , but from my experience , when sourcing for my exedox team , I’d reach out to them and when such questions come up , I’d let them know that we don’t have an MVP yet and no one’s getting laid off . That hence the project is released and in production we can revise the ‘pay’ . It might not work for you though.. But it works for me , sometimes 😏.

How Do You Fund A Startup ?

Crowd Funding – If you have a sexy idea and you’re great at social media, crowdfunding might be an option.

Crowdfunding is a way of raising money to finance projects and businesses. It enables fundraisers to collect money from a large number of people via online platforms. Crowdfunding is most often used by startup companies or growing businesses as a way of accessing alternative funds.

So let’s say you create a crowdfunding campaign to purchase new equipment for your company. The individuals who give you money do it out of support for the growth of your business and nothing else.

The downside? Lots of companies aim for crowdfunding, so you have to generate a lot of buzz to make it through the overall signal noise. It’s also very possible to overextend yourself and frustrate backers, which can lead to a great deal of animosity before your company is even really off the ground.

Loans – A small business loan gives you access to capital so you can invest it into your business. The funds can be used for many different purposes including working capital or improvements including renovations, technology and staffing, business acquisitions, real estate purchases and more. It is a lump sum of money you borrow from a lender, then pay back at fixed intervals — with interest — over a set period of time. Depending on your lender, you’ll pay off the loan on a weekly, bi-weekly, or monthly basis. Repayment periods can last from a few months up to 10 years or more.

Some banks specifically offer loans to small businesses, but banks historically are careful about giving money to small companies. It can be difficult to qualify. There are alternative lending companies, however, who may be better equipped to help you get your business off the ground.

Small Business loans typically have lower rates and longer terms than you could qualify for with a conventional loan.

The downside? Some of those alternative lending companies are predatory. Make sure you know who you’re borrowing from before you sign on the dotted line.

Mutual Funding – Borrowing money from friends and family is a classic way to start a business. While it may be harder to convince investors or banks of the quality of your idea, your family and friends often believe in your dream.

They may be more willing to help fund your company. If you do go to friends and family for loans, it’s a good idea to make sure that each of you gets sound legal advice, especially if you are taking the money as a loan.

The downside? Borrowing money is a quick way to lose friends and sour family relationships. Be careful if you decide to proceed this way.

Angel Investors – An angel investor or Seed investor is a high-net-worth individual who provides financial backing for small startups or entrepreneurs, typically in exchange for ownership equity in the company.

During an angel investment round, investors can purchase equity in the company, giving them a certain percentage of the ownership. This equity stake can then be cashed out at a later date when the company has increased in valuation, earning a profit for the investors.

You probably know about Dragons 🐉 Den ? Unless you have a great idea and a strong business history you won’t be able get in . But if you do get in , and your idea is amazingly beautiful & awes the investors then be sure you can make a very great turnouts of funding from them .

Venture Capitalists – A venture capitalist is a private equity investor that provides capital to companies with high growth potential in exchange for an equity stake. This could be funding startup ventures or supporting small companies that wish to expand but do not have access to equities markets. The term does not only refer to people but also companies. Google Inc, for example, is a major venture capitalist. Its division, Google Ventures, focuses on venture capital. Google Ventures also has a large European arm, which the company set up with an initial investment of $100 million. There isn’t so much difference between Venture Capitalists & Angel Investors But Yeah The Pressure Rate is a factor 😌.

What Is Equity?

Startup equity is the amount of ownership shareholders have in a startup. It is the percentage of the startup’s stock sold to stakeholders (such as investors, advisors, and employees). This gives them the right to share in the profit or loss of the startup.

As A Startup Founder , Distributing your startup equity is not something to be done without thorough research and expert guide. You should speak with your lawyers & finance officers for help in the valuation and equity sharing in your company. Most startups gives equity to the people who believe in & work with them in their formative years , but like I said earlier , and now except you have a proper valuation don’t talk about equities ‘ for now’ 😌 ✍️!

Types Of Equity

Common Stocks – common stockholders participate in the earnings stream of the corporation through dividends paid and capital gains made on a per share basis. Owners of common stock are responsible for the election of the Board of Directors, appointment of Senior Officers, the selection of an auditor for the corporate financial statements, dividend policy, and other matters of corporate governance. This type of equity is usually for the founders , board of directors et cetera.

Preferred Stocks – the startup equity confers some benefits on its holders. Some of them are: a right to vote during annual general meetings and contribute to the decision making process, dividends, special discounts on the product/service, etc.

Startup Stocks Distribution

For the founders sharing the ownership stakes in case of two or more founders, the sharing ratio has to be handled decisively. Some factors need to be considered in the sharing process. The factors commitment to the business, level of risk taken by each founder, idea contributions. There are different equity sharing models which can be used. It depends on the nature of the co-founders relationship. Common equity splits include: 50:50, 33:33:33, 60:40.

The role of each founder can also play a big part on the degree of the ownership they get. For investors (this includes venture capitalists, angel investors, and other people who invest money), the equity each investor will get depends on the value of the startup at the time they invest and size of the startup , It is given to investors in the form of common stock or preferred stock.

The share can also give them a voting right when a decision is to be made in the startup. Some startups typically have some founders in their management board who might not give financial investments. These founders usually offer expertise, a credible name, powerful network or mentorship guidance. The employees that begin the startup with the founders and support to scale can also be offered the startup equity.

Some founders might also offer these founding employees a stake in the startup if they are not able to pay competitive rates. If they believe in what the startup is building, then the startup equity could be a fair reward for most employees. The degree of equity offered to employees has to be determined by the founder(s). Also, the employees need to fully understand what the startup is offering to make an appropriate decision.

Registering Your Startup

Of course you need to register your business 😋 it gives you a lot.of advantages but that would be on another content. I share link on the comments.

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