From Idea to Product: How to Start a Tech Business

Insights into the lifecycle of a tech startup, including key milestones and strategies for growth at each stage. If you’ve been wondering how to start a business in technology, this article is for you. 

Have you ever wondered how to start a tech business? The steps necessary to get the venture off the ground are well known, yet somehow still wrapped in a veil of mystery. We hear left and right about various stories of fledgling companies' success, but yet the stories don’t contain many recipes to make our own happen. My many years of experience as an entrepreneur coach has given me a unique perspective on this topic. In this article I want to share the way that I see the stages the companies go through and emphasize things that are most important to the founders of other startups.

What is your exit plan?

This might surprise you, but the first thing I would like you to consider is where you would like your company to end up in a few years. It might feel a little immature, but this decision will guide your company's path and will help you steer in the direction that will be the best fit. Consider the scale of your ventures and whether you want it to be sold to a larger player, or perhaps be a lifestyle business going forward. Your choice will dictate the efforts, timeline and investment required to make this a reality.

Definition of Success

At each of your company’s stages of growth, you will have to perform a lot of activities to sustain the business. Beware of work that just keeps you busy. Each activity needs to have a clearly defined outcome. What does it mean for this activity to succeed, change or fail? If you are performing a task just because another company or client is doing it, it is not tied to the context of your enterprise. Your time bandwidth will be incredibly challenged all the time during the company’s development, and you don’t want to execute any activities that are not meaningful to your journey.

Having gotten these two important preambles out of the way, let’s look into more milestone-driven aspects of how to start a business in technology.

Ideation: Start with Passion

It is a common belief that you need to have an idea to start your company. However, in the past decades through Lean Start-up and Steve Blank’s methodology, it has been disproven. The primary component of starting a business is for you to have the desire to do so. The next step is to figure out what the business will be about. I generally recommend selecting a couple of industries that you are very passionate about. Think of industries which you love so much, you would be willing to work for peanuts as long as you get to drive the industry forward. One of the reasons for doing so is that if you are building your company, you should also be enjoying it as much as possible. If you do it in an industry that you don’t like, your optimum outcome will be minimized. Secondly, building start-ups is a difficult endeavor and there will be long stretches when nothing will be going right for you, and then you can rely on your passion to pull you through. Again, this passion is really hard to find in the environment that you don’t connect with or enjoy.

Additionally, it is good to pick an industry where you have at least some overlapping strengths and experience. You don’t have to have the knowledge or network of the inside and out of the industry, but it would be helpful that you know some of the ABCs. In the process of building your business you will encounter a lot of learning curves and bringing your experiences to the table will reduce the number of areas in which you’ll need to start from scratch..

From Passion to Solution

So what about the idea? Technically an idea is the same thing as a solution to an existing need in the industry. As part of your start-up development and after selection of the industry, you need to conduct 100s of open-question interviews in person with representative players. You will ask them to talk about their day-to-day business and carefully listen or specifically inquire about any frustrations, annoyances or gaps that exist. Once you hear some, follow-up with a few additional questions to clarify and to define boundaries of these emotions. 

After conducting dozens of interviews, you will start seeing some patterns in these answers. Your goal is then to pick some of those concerns and develop a plausible and maybe a hypothetical solution. Once that draft is done, it is a good idea to go back to your interviews and ask if this will be helpful to address their needs and if yes, how much are they willing to pay. While this process reads as somewhat linear, as part of your selection you will have to use intuition, analysis and gamble of some of these needs as the ones they need to be addressed. You can also abstract these conversations as your negotiations with the industry on how you can be useful as an entrepreneur.

Traction 

The best outcome is that your interviewees will become your first customers. This will probably happen after many conversations as you refine your solution MVP. This is one of your most important client cohorts. They will help you get your business off the ground and solidify your presence in the industry. Keep in mind that there will be other shiny distractions, but the most important metric to optimize for is - are your customers getting the solution they need, and are they paying for it?

Scale and Investment

Once you get your initial clients through the door and the business starts growing, you will have to decide whether you want to grow faster and outpace your competitors or if you want to stick to organic pace. Growing faster will require external investment and growing slow risks being left in the dust. There is no right answer for your business, and there are usually a lot of tradeoffs.-For example, you’ll need to consider if  your product is ready for a larger audience, and if your team has experience managing a larger company. Do you want to take an outside investment and lose control of your business? Many of these questions are very context-driven and once you are at that point, you will have the opportunity to gather advice from others and make the right decision for your company.

Keep Your Growth Mindset

As your business grows, you’ll undoubtedly experience different challenges over time. Eventually, you may find yourself needing executive presence coaching, leadership coaching, or other services. Keep an open mind as you grow, and finding help will be that much easier.