How To Start A Tech Startup From Scratch

Zoho. Mailchimp. BiggerPockets. Shutterstock.  What do these recognizable tech brands have in common? They all bootstrapped their way to success. However, not all survive without raising funds—more than 90% of businesses on Forbes Cloud 100 for 2019 accessed funding to start their businesses.

Starting a successful tech business from scratch isn’t that simple. About 90% of startups fail. The main reason for the failure of tech companies, and start-ups in general, is entrepreneurs developing products that fail to match market demands. 

As a minority launching a tech startup, you can benefit by applying for small business grants for minorities to help the business take off successfully.

How To Create A Tech Startup

1. Develop a product

Sounds obvious, doesn’t it? The leading cause for the failure of startups (42%) is a mismatch between the product and the market. Create an app that meets an existing customer’s need.

As a programmer, you’ll devise the fundamental product features, get feedback from co-founders & select early customers. Based on their responses, you’ll refine the app to deliver an experience they’ll be willing to pay for. 

2. Presell the product before you launch

Onboard paying customers has several benefits. For one, you allow clients to co-create the product and integrate their feedback into the final product.  

Next, it’s also a way of testing the suitability of your product for the market. Lastly, raising cash at this early stage solves the challenge that many startups face; money running out. 

3. Assemble a talented team

A skilled team may differ between a vibrant tech business’s birth or an entrepreneurial stillbirth.  Fortunately, you don’t have to spend massive resources recruiting the ideal techy for the job. Visit web platforms to connect with software experts who can advance your business. 

4. Marketing your product pre-launch

An aggressive marketing strategy ensures that your product gets in the face of your targeted customers. 

You may not afford an elaborate marketing campaign as an emerging tech startup. Nevertheless, you can exploit popular online communities on tech sites like Hacker News, Reddit, and Product Hunt. 

5. Raise funds

We’ll consider this in further detail later. 

Methodologies To Start A Tech Startup

You should start lean-to up your chances of survival as a tech startup. Begin with a simple sole proprietor or partnership model and circumvent unnecessary legal hurdles of complex LLC registration. 

Prioritize refining your product to suit available demand while fine-tuning pricing and a load of other particularities.  Starting lean is also cost-effective as it ensures that you generate products that click with customer needs. You continue to fine-tune the products as the process progresses. 

Mistakes To Avoid If You Are Thinking Of Setting Up Your Tech Business

• Launching a product without adequate market research. You end up with a product that the market doesn’t need or may not be willing to buy.
• Wrong choice of a market segment
• Failing to hire the right people for the job
• Expanding too fast
• Procrastination
• The fear of failure
• Being inflexible and unresponsive as you develop your product

6 Ways To Financing Your Startup

Once you have a market-ready product, you can seek the funding required to serve your market profitably. 

1. Bootstrapping: You can tap into your savings or from family and friends. You can maintain your regular job while building your tech concept at the initial stage.
2. Crowdfunding: examples include Kickstarter, GoFundMe, Fundable, and IndieGogo. You can pre-sell your product before the launch date or offer equity to potential investors.
3. Accelerators: Apart from funds, they offer much-needed mentorship and networks to startups.
4. Angel Investors: They invest about $150,000 and have a greater appetite for tech companies.
5. Online lenders such as Camino Financial target small businesses by minorities. The loans range from $5,000-to $400,000
6. Grants: Look out for small business grants from the government

Conclusion

Starting a successful tech business takes courage, technical competence, and market research. As a minority, you can leapfrog your tech startup by reaching out for funding from your savings or external sources such as crowdfunding platforms and organizations offering small business grants.