You know your new business is poised to succeed if you can confidently answer these questions.
Good journalists know their news articles aren’t fit to print until they answer the five Ws — who, what, when, where and why — and an H, how. These basic questions lay the foundation for a strong story.
If a reporter fails to answer even one of these questions, their editor will likely send them back to the drawing board. For an effective news article, everything beyond the five Ws and an H is just fluff.
So what do the five Ws have to do with startups? The questions that make for a good news story are the same ones that can determine whether your startup will be successful. (Click here to Tweet this thought.)
You should ask these questions as soon as possible — and make sure you have answers — to build a solid beginning for your business.
Fail to answer them, and your startup may end up half-baked.
- Who do you think you are, an expert or something? You’d better be. If your business expects to score repeat customers, you’d better be well-versed in your product or service and confident in who you are.
- Speaking of customers, who is your potential audience? Who wants what you’re selling? If you don’t figure that out, you could waste time and money trying to sell a product no one wants.
- Who will play the major roles in your fledgling company? You may have a business partner, or you may be the sole employee. Either way, get ready to take on any and every role until you can afford to hire. And then the question becomes: Who do you need to bring on to keep your business moving forward?
- What are you selling? Can you describe your product or service in two sentences?
- What makes your product or service different than XYZ Company?
- What’s your mission?
- What are your expected costs for rent, equipment, overhead, technology and insurance?
- Where will you do business? Outside forces may come into play here. For example, you may want to start your auto repair business at home, but will the neighbors, the local zoning board and the EPA support your choice to rebuild engines in your garage? You might need to rent a physical business space, which may significantly change your answer to the “what” question of business costs.
- Where are you headed? For example, my business wants to help millions of U.S. small business owners with online software. We’re not there yet, but we’re closer to accomplishing that goal than we were last year and making progress every day. We haven’t veered off course. So be intentional: Look where you’re going, and periodically revisit this question to make sure you’re still on course.
- When will you stop talking about it and make it official?
- When will you take care of the legalities (getting your business license, filing your incorporation papers, etc.)?
- When do you plan to fire up the assembly line, break ground or open your doors to the public?
- When will you keep track of the money flowing in and out of your business?
- When will you tell the world?
Why are you starting a business? Before you do anything rash like quit your job, take time to examine this one carefully:
- Are you tired of your boss? Your new boss will take the shape of every customer who walks through your door.
- Are you sick of working so hard? Get ready to work harder than you ever have in your life to get your business off the ground.
- Is it because you want to get rich? That probably won’t happen right away — if ever.
- Is it because you have an idea you’re passionate about, because the world needs what you’re selling and you’re the best person to do it? Now, those are some better reasons and positive signs you may have the passion it takes to be successful.
- How will you make this thing happen? You may have an invention that will change the world, but until you answer the “how” question, develop a plan and put it into action, your idea will remain just a fantasy.
- How will you satisfy the customer’s demand for your product?
- How will you finance your operations? Do you plan to withdraw your life savings, borrow from family or find investors?
- How much do you need to start?
- How will you survive until you start making a profit?
- How will your startup affect your family life and other relationships? How does your spouse feel about the idea? How much input and involvement will they have?
- Finally, how will you handle the highs and lows of life as a business owner? Believe me, after 27 years and with five small businesses under my belt, I can confidently say you need to be made of strong stuff. If you want to run a business, you must be ready for anything and everything.
There you have it: The who, what, when, where, why and how of a business. Best of luck in your venture. I look forward to hearing the story of your success.
Mike Kappel, president of Patriot Software, Inc., offers more great advice for entrepreneurs in 87 Must-Answer Questions for a Startup. You can connect with him on Google+, on Twitter @MikeKappel and on LinkedIn.