Malcolm Turnbull’s recent announcement putting economic growth and development at the top of the national agenda is welcome news to me. As managing director of an Adelaide startup, I know first hand how much hard work and financial risk it takes to start a successful business.
Australian entrepreneurs should grab this opportunity to test out their ideas, and challenge the concept that innovation only happens overseas. You don’t have to leave Australia to get a strong mentor, to start and grow a successful business.
My business started as a partnership with my father in 2009, I was determined to stay in my hometown of Adelaide, I’ve proven that even in a ‘regional’ center like Adelaide, South Australia, there’s scope to create success.
With Australia’s major political parties competing on policies to unlock capital and support regional investment, there’s never been a better time to put a new business idea in motion. I’m sharing 17 essential lessons from my personal experience:
1: Use a scalable, sustainable business model.
The changes introduced by Turnbull’s innovation statement should make starting a business in Australia easier, but it’s never been more difficult than now to scale. Chances of a new enterprise ascending as a scale up are only about 0.5 per cent. This is due to two main barriers: talent gaps, and skill shortage. There are definitely ways you can navigate this (check out my tips below).
Design your business around solving a pain point, and do it in a scalable way. Ensure sustainability right from the start, by putting in place a system to ensure compliance and minimise waste of time, money and resources.
2: Solve someone’s problem
As an entrepreneur you likely have ideas flowing constantly, as you ask questions and look for solutions to life’s inefficiencies. So which ideas should you pursue? The best way to answer this is to look at what people want, that they aren’t already getting.
If you’ve found an awesome solution to something that people aren’t aware of being a problem, you’re going to have to work harder to educate your market. If your market doesn’t want your solution, it’s going to make it harder to sell.
You’re on a winner when your idea targets both needs and wants.
3: Get a mentor
70% of small businesses with a mentor survive for 5 years or longer (going it alone, only half this number reach the 5 year milestone).
Check out this video for how to find a mentor, and some reasons why a mentor could make the difference between making it and not.
Having my dad on board has meant that I have someone to bounce ideas off, someone with 30 years experience in the industry, who isn’t afraid to tell me exactly what he thinks. It’s also provided the chance to give me a reality check from time to time when my ideas get out of hand.
4: Make sure you have a source of cash flow to build capital
Even the best ideas cost money to develop. No matter what niche you’re in, you need to ensure you have cash flow to pursue your idea.
Use a business model that will generate an income while you put your idea in motion. For me this meant focusing on asset finance. Australian’s change cars every few years. By setting myself apart by providing car finance with premium client service, I was able to build my business into the group of companies it is today.
As a bonus, I uncovered technology and processes, and established key relationships to nurture and expand my business into home loans and wealth management.
5: Manage your time
Be on time for appointments. If you say you’ll call a contact at a certain time, make sure you do.
Remember that success is 99% implementation.
6: Be prepared to work long hours and make yourself available outside normal business hours
At the start, you’re going to have to work hard to differentiate yourself from your competition – if you’re driven to succeed, you’ll be committed to do whatever it takes. Be prepared to give up an evening or a weekend here and there in order to get your business up and running.
Small business isn’t about money or connections, it’s being willing to outwork and outlearn the competition.
7: Give something back
One of my chosen influencers, Richard Branson, said “Screwing business as usual fundamentally recognises that doing good is good for business”.
This is definitely true. Giving back through Kiva and donations for coffees and casual days to the TIA Foundation has opened discussions amongst staff and given our office a sense of purpose beyond the daily grind.
8: Relationships are key
Never overlook anyone who adds value to your business. Creating and maintaining good working relationships and a strong business referral network will be essential to your success.
Don’t be afraid to talk about your plans and ideas. You can create an amazing product, but if no-one knows about it, it isn’t going to sell. You never know where you’ll find an opportunity.
9: Embrace technology
Malcolm Turnbull announced that Australia needs to be “more competitive, more productive and work more agilely.” He’s right. If you want to be a market leader in any industry, you need to embrace technology. In banking and finance there’s already been a huge shift towards consumer demand for digital portals.
You don’t have to move to Silicon Valley to be a successful start-up, but it won’t hurt to take on a few of their ideas.
10: Take risks
If you want to witness the growth of your business, you’ll have to get uncomfortable.
For me, this meant a trip to San Francisco, a last minute decision which left me staying in Tenderloin, pretty much the roughest neighbourhood in the city. Dad and I didn’t get a whole lot of sleep, but it was totally worth it.
The Dreamforce Conference was a huge inspiration for me, despite the confrontational experience of trying to sleep in a suburb where 7 of the 10 most dangerous violent crime plots in all of San Fran occurred, rife with homelessness and public drug use.
I’m not suggesting that you bed down in a dangerous region to get your business inspiration, but if you don’t take risks on your hunches, you’ll never find out where they could lead.
To establish a successful startup, you have to break outside the traditionally risk-averse Australian mindset, and take cues from less conservative businesses overseas.
The new changes to federal legislation will reduce the default bankruptcy term from 3 years to one year, and reduce liability of small companies facing bankruptcy, creating a safe harbour from personal liability for directors, and giving the risk-takers the opportunity to take those risks and face lesser consequences.
11: Track your competitors
To stay one step ahead of the market, you need to know what your competitors are doing. The key to a scalable business is knowing how to tailor your product, service and marketing to fill the gaps that the competition leave. One good way to do this is by reading your own and your competitors customer reviews.
Don’t obsess this point too much, but know your industry so that you don’t get left behind.
12: You have to spend to make money, but spend smart
Make sure every dollar you spend has a traceable Return on Investment. This especially applies to marketing strategies, and staffing.
13: Outsource until you grow
You can’t do everything yourself. When we started, it was just Dad and I. We worked to generate business leads and make sure every client received great customer service and around the clock service.
In our 3rd year we had more business than we could handle. I have to admit, it was very tempting to try to micro-manage every aspect of our quickly expanding business and I tried to keep doing everything for a long time. My biggest regret is that we didn’t start to delegate and outsource sooner.
Using web-sites like e-lance and 99-designs, you can find web-developers, graphic designers and copywriters for one-off or occasional projects.
14: Go digital
In January 2015, 51% of Australians bought something online, and 57% of Australians have active social media accounts, spending an average time of 2.4 hours here, with 51% accessing the accounts from their mobile phones. It’d be crazy not to leverage this platform to grow your business.
This diagram from sums up what you need to know:
As you can see, web traffic via mobile increased 51% in just 12 months. This means now is the time to find ways to use digital tech to engage with your market.
15: Find the right team
Hiring the right people isn’t just about the resume and experience that they have, it’s about whether or not whether that person is a good fit for your brand and organisation’s culture. As a business owner you need a clear vision of what you want your business to look like.
It’s just as important to let the wrong people go – every person on your team needs to be making valuable contributions. Negativity is contagious, but the right people will affect those around them positively.
“If everyone is moving forward together, then success takes care of itself”. – Henry Ford
16: Listen to your customers
What’s causing your customers pain? Find out, and fix it. This will earn you repeat business. Pay attention to reviews and adapt to provide people with an efficient product or service that fills their needs and involves minimum hassle.
If you listen to your customers and take the feedback on board, it can allow you to develop a better product, service and/or marketing. Sometimes you’ll be surprised, we surveyed our customers and they told us they wanted to be able do the calculations using the tools we use in house, so we provided them with our in house tools on our website like this chattel mortgage calculator.
Don’t be the person who’s so focused your awesome new idea, service or product that you fail to market it at the right time, to the right people. Remember that you aren’t just selling your product or service, you’re selling your customers a better version of themselves. It’s essential that you know what it is that they really want.
17: Be tenacious
Building a business is a marathon, not a sprint. You have to be resilient, and you need to be stubborn about your idea, because you will meet people who criticise you, and tell you it isn’t going to work.
You’ll need to be confident enough to pursue your idea, and possess enough self awareness to be able to take on advice from others with business experience, especially those who’ve been there before. Don’t let stubbornness prevent you from getting guidance, because if you use the opportunity to learn from other’s mistakes, there’s more scope to make a few new mistakes of your own.
About the author
Tom Caesar is the Managing Director of The Positive Group, a group of companies offering comprehensive financial services to clients Australia wide. The Positive Group consists of businesses focused obtain car loans & asset finance, mortgages, insurance & wealth management. Tom’s entrepreneurial approach to business has seen the group grow into one of the lead providers of financial services Australia wide. Tom regularly contributes articles on car finance, insurance, technology and business growth, drawing on his experience of starting his own company