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3 Vital Things New Entrepreneurs Must Do to Transform Vague Ideas into a Viable Business


Commit to your business idea


Almost all successful businesses begin with a good idea.

But successful business ideas do not need to be extraordinary. Even straightforward ideas can grow into billion-dollar companies. Execution is king when it comes to building a business.

All businesses must meet a market need, get in front of the right customers, and master execution.

Passion is important. But you need to know the difference between passion and profitability. You need to make enough money to keep the business afloat and achieve your personal goals.

Create a business plan

Some critical questions to consider include the following:

  • Does this idea meet a real need or desire?

  • What am I selling?

  • How much does it cost to provide my products or services?

  • Who are my target customers?

  • How much are they willing to pay? (Link to another article on pricing)

  • Who are your competitors?

  • Who are your ecosystem partners (i.e., what other products/services complement yours?)

Set up the proper legal structure



Your business needs the correct legal structure. You need a legal entity, brand protection, and contracts.

Legal entities

Some common legal entities for businesses include LLCs, partnerships, and corporations.

When choosing a legal entity, some factors include the following:

  • Owners of the company

  • Liability protection (link to another article on liability protection)

  • Distribution of the company’s profits

  • Needs of your business based on what you are doing or selling

  • Taxes

Brand protection

It is very important that you protect your brand from competitors and copy-cats. You can do this by securing your intellectual property with copyright and trademarks.

Copyrights protect original, tangible, and creative works.

A copyright gives the owner of a creative work the right to keep others from unauthorized use. The creative work must meet the three criteria below:

  1. Original - the author must have created rather than copied it

  2. Tangible - recorded or written down

  3. Creative - human intellect must produce it

Trademarks protect your space in the marketplace. They cover words, phrases, and logos that distinguish a company from its competitors. These include brand names, distinctive words, sounds, smells, colors, and other devices.

Trademarkable brand assets include:

  • Your name (i.e., the name you use for your business in the public marketplace).

  • Your logo.

  • Other distinctive parts of your business and marketing.

Contracts

Contracts govern relationships.

You may have business relationships with vendors, suppliers, and creative contractors. Contracts help everyone know what they need to do, when, and how. They are also essential if there is a breakdown in the relationship.

You also need contracts to ensure that your business owns everything it needs to own.

For example, if you hired someone to create your logo, the creator would usually own the logo. To secure your logo, you must contract with the creator to transfer ownership.




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