Napoleon used to say that war rests on such a foundation as money. Funding is important in an area such as business, but the ultimate success always depends on major ideas and inspiration. Many historians confirm this by recalling Rothschild. So, he said that to have a regular salary, you have to work hard, but to become a millionaire, you have to have business ideas.

Startup is the idea for business in the abstract sense, but it only became popular in the early twenty-first century in the form of a concept. Neil Patel is a famous American entrepreneur, and he wrote on his blog that in today’s world, the lucrative market segments are already taken up by large corporations. Therefore, the secret of success for beginners is the concentration on a small segment that has a large demand and a small supply within a large and popular commercial direction.

Startup definition

According to Wikipedia, Startup is a commercial project with a short history, a fast-moving and scalable business model. At the same time, rapid scaling is creating and moderation of a commercial project to the level of the highest profitability in the shortest period.

That is why the startup also coincides with the model of «viral explosive growth». However, there is an opinion that startups are developed on the basis of non-standard business models. However, all theorists agree on the following:

  1. Like the viral distribution of advertising, startup creation begins with the development of the unusual concept of engaging the target audience (such as pre-seed) and seeding.
  2. Alpha and beta testing technology results make startups similar to such strategies as Growth Hacking.
  3. At the heart of the business plan, there is a demand for unmet needs of a narrow target consumer audience through non-standard approaches.

Business is helping people solve problems and life problems first, and not just buying and selling. Startup is also a quick and easy start that means it does not need huge funding.


Why investment is the best start for business

Commercial activity is similar to gambling as there are some winnings and losses. Professional entrepreneurs develop a business strategy with an emphasis on minimising risks, so that winnings compensate for losses in the end.

This is why experienced investors give money with little enthusiasm when it comes to startups. At the same time, if a young project has a classic business plan, they will think differently. Despite the fact that the profit will be small in the future, but they also do not have risks because the mature working principle operates there.

You can show your investor better prospects than in a traditional business model if you want to convince him to invest in your startup. There is one more similarity to viral advertising, which is that you should develop a commercial offer that will immediately interest your investor. The phrase killing offer corresponds to this phenomenon.

Seed stage

Neil Patel explained the concept of unpopular segment and unmet demand within a widely sought-after product. The fact is that you won’t get much popularity if you don’t have a large number of customers or customers. However, there is a great demand even in small market segments, in which the target audience does not find full and deep satisfaction of its specific needs.

There is one example for the development of a network of cafes and bars for bikers in the United States in the 1950s:

  1. Thousands of veterans have returned from the war, who are accustomed to regular life risks. They believed that regular life is too boring and uninteresting.
  2. The motorcyclists emerged soon after, which compensated for the lack of adrenaline due to high speeds.
  3. However, every person likes to eat deliciously, and this is a good factor if there is also a pleasant company.

Motorcyclists dressed up flashily and behaved provocatively, and traditional cafes and bars often prohibited them from using their services. It was in those years that a certain enthusiast generated the idea that he could organise a place for motorcyclists to communicate in a form that they would appreciate for sure. This business did not require much investment.

So, the beginner businessman could develop a unique interior design with photos of famous riders and their autographs on the walls of this restaurant, as well as create a menu of beer, tequila, and roasted meat. There is a small investment. However, motorcyclists are a small audience, and such a startup has no alternatives.