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By Macy Myers: Starting a successful business is no easy task. We’re here to weigh in on what entrepreneurs can do to start and sustain a successful business with simple but effective implements. A sustainable business requires dedication, adaptability, and continuous learning! In this blog, we outline some basic steps and chime in with some of our amazing staff on more advanced steps to make your business successful.
Photo by Alexis Duncil
Sink or Swim
First things first, research the market. Conduct a thorough market analysis to identify the current landscape, market needs, and your potential competitors. Determine the demand for and viability of your product or service. In California, it’s essential to know what’s happening with water, including how legislation affects energy and tech. Subscribe to a wide variety of newsletters, journals and research surrounding the most relevant events in this space. You can also do this with energy and ag-tech-focused news outlets, so you can stay well informed on topics, issues and solutions that are emerging as well.
Developing unique and sustainable solutions that address specific challenges in the water, energy and ag-tech sectors should set you apart by offering new and innovative solutions to your target audience.
To define your target audience, you must have industry expertise. This is where you can acquire in-depth knowledge of the field to which your product or service applies. It’s essential to stay updated with the latest trends, technologies, and regulations. Build connections with industry experts and learn to collaborate. The Water, Energy and Technology (WET) Center offers a few programs that can help you do just that. Specifically, our Central Valley iHUB program helps connect industry leaders from various communities within the Central Valley.
No matter where you are located, it is crucial to create a solid business plan. Craft a comprehensive business plan that outlines your goals, target market, revenue streams, marketing strategies and financial projections. This plan will serve as your roadmap to success. Not sure how to put all that together? At the WET Center, we can help you do this via our Advising Services or your enrollment in our Valley Ventures accelerator program (to name a few!).
The Road to Success
The road to success with your business is fueled by adequate funding. Determine the funding required to support your business operations, research and development, and marketing efforts. Explore a range of funding options such as grants, investors, loans, or crowdfunding platforms. If possible, try not to put all your eggs in one basket. This article from the Small Business Administration outlines a few more tips when funding your business.
Decide who your passengers should be. Fostering partnerships and collaborations can help you develop strategies with relevant stakeholders, organizations, research institutions, industry leaders, and more. Locally, The Central Valley Community Foundation helps to provide capital and communities. Collaborating with others can provide valuable resources, expertise, and expanded market reach to help you play key roles in your community and beyond.
Understand regulatory compliance: familiarize yourself with the legal and regulatory requirements specific to the water, energy or ag tech sectors. Ensure your business complies with environmental, safety, and licensing regulations.
Plan for scalability and sustainability: design your business model with scalability and long-term sustainability in mind. Anticipate growth opportunities and consider the environmental impact of your operations. Part of scaling up in today’s market is understanding relevant technology. Read suggestions on the 5 must-have technologies for a brand-new business.
While growing, create a compelling brand identity that resonates with your target audience. Implement effective marketing strategies to raise awareness and differentiate your business from competitors. Part of your effect is presence in the online game. Here are 5 options for getting your business online.
Understanding your competition is necessary, but your primary focus should be on customer satisfaction. Understand your customers' needs, challenges, and pain points. Provide exceptional customer service, actively seek feedback, and continuously improve your products or services based on customer insights.
Starting a successful business is no easy task. As you climb the ladder, here are a few things to consider in our Q&A with Benjamin Francis.
Q&A with Benjamin Francis, Growth Operating Partner at the WET Center
Q: What are a few different successful revenue models you have seen startups pursue?
We have seen various revenue models, but most of them generally come down to selling their technology as just a product or bundling a package of technologies and services as a subscription. For our companies that are more in the energy space or have a more mechanical product in nature, they usually simply sell their product outright and include some sort of warranty. Other companies that have software products usually sell their product as a monthly or annual subscription. We see a trend where most startups try to fit their products into the subscription model, as this usually reaps higher long-term profitability, valuations, and more stable cash flow projections. Several of our companies package their hardware and maintenance of said hardware as a service, which lowers the upfront cost for the customer and provides a more stable expectation of performance as well - the customer knows as long as they pay the monthly/annual bill, they are now buying performance and the startup has to continue to stand behind their product to continue getting paid.
Q: In your opinion, do startup companies grow more effectively by increasing topline revenue or optimizing costs?
In most cases, a company will be more effective by focusing on increasing revenue. In the early stages, most startups don’t have enough revenue to cover any sort of overhead and expansion so their financials are continuously in the red until they significantly grow their revenue. There does come a philosophical difference on the cost side of things when it comes to growing revenue we see a difference between certain founders. Founders that take on venture capital will set more ambitious goals around expansion and therefore expand their overhead costs. These overhead costs usually outweigh the company’s revenue in hopes that in the future, the startup’s revenue will grow to the point where this overhead can be more justified financially. This puts pressure to make sure the startup is able to reach these ambitious goals within a relatively short time period, which the market may or may not support, or they risk going under. On the flip side, we see founders that bootstrap, many of which have very little overhead at the beginning because the cash flow can’t support much. These founders have the ability to be more patient with their revenue growth and give the market more time to adopt their product, but they risk losing out to a faster competitor and falling short of customer expectations because they did not have ample resources to support the business model or product properly.
Q: What are a few resources, points of contact, or web pages to get started on if you have a new business idea and have yet to make it a reality?
We’d encourage all businesses to first stop by the WET Center, and we can help you navigate all the resources. Outside of that, I’d say building your network is the first place to start. There are plenty of resources on the web to learn how to start a business, but you’ll supplement that with a network of people that will guide you to specific resources relevant to your business. With that said I’d usually say check out your local scene first to see what resources are available. Usually, there are university programs to help entrepreneurs, among other resources provided by SBDC and SBA. If you are in more of the technology side of things, I’d recommend looking up the closest incubator and getting plugged in there. If you are in the water, ag, or energy nexus, start going to industry events where your customers will be, and just start talking to them (not selling), many people are very open to give you feedback on your idea. In addition, there are plenty of great accelerator programs that provide resources for your business that can really kick-start things but try to have your business model and research figured out first before you apply. I’d encourage you to fill out the “Lean Canvas” at least and have talked to customers before approaching any of the accelerators.
Q: How would managing contacts and data serve your business, especially as a new company? Does this play a major role in investments down the line and customer service?
When a founder is launching a business, they will be overwhelmed by the number of things on their plate. It would be near impossible for a founder to properly retain all the information they are running through on a daily basis unless they have their information organized. We highly recommend utilizing CRMs and taking notes on every conversation you have with just about any customer, investor, or general prospect for your business endeavors. In addition, we usually recommend heavy note-taking combined with file storage in some cloud solutions such as Google Drive. That way, you always have access to your documents and can link them to other files. Without the proper organization of your documents, commitments, and conversations, it will be difficult to focus and retain everything when you are in charge of every operation of your business. Finally, we recommend a strong use of calendar organization. This ensures all vital tasks are being completed and forces founders to spend time on tasks they would typically ignore in favor of others.
Q: How can you ensure that any business partners you plan on seeking will benefit from working with you? How can successful negotiation play a role?
The most important part is setting expectations in front of both parties. If that is done around pricing, performance, and what each party provides, you will have a smoother time if things go wrong. Many founders are so focused on selling or partnering with an entity based on the potential upside for their business that they don’t slow down and consider what the other party's expectations are and they also don’t consider their own needs to make the partnership work for them long term.
Q: What else would you recommend to a Central Valley startup business in water, energy, or ag technology?
When launching a business with a new idea, don’t get hung up on the idea, but instead, focus on the customer and their receptiveness to your idea. At the end of the day your goal as a business is to sell something that people will pay for, so don’t try to force your idea if you find that people don’t want to pay for it. Your goal is to create something people want to pay for - that’s it. Stay nimble at the beginning to where you can either pivot dramatically or shut the idea down entirely if it doesn’t work - which is okay because there are other ideas and opportunities you will come across in time. NSF has an I-corps program with founders interviewing at least 100 customers and stakeholders. By the time they have completed the interviews and decide to launch their business, they have a clear picture of what it takes to build something that people will buy. They focus more on what will sell, not what we can build. You should also do that with an open mind and preparedness to go deeper than surface-level questions with your customers and let your curiosity help you discover more about the opportunity.
While starting and sustaining a successful business is an outstanding venture full of trial, turbulence and tenacity, there is a positive outlook for business opportunities in California and across the United States. The WET Center is here to help you as you climb the ladder! Questions about how you can get involved in our programs or need help with developing your business? Please email info@wetcenter.org. Thanks for reading!
Funding & Other Opportunities
Additional Funding Opportunities
WET Center Members in the News
Industry News
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Employment Opportunities
SR Sales and Marketing Consultant Email: abner@thebusinessjournal.com
Center for Irrigation Technology Hydraulics Laboratory Lead Research Technician
Don't fret. We have your July calendar of events lined up for you! Check them out below.
Upcoming WET Center and Partner Events
Independence Day (United States) Holiday - Our office will be closed!
July 24- Women in Ag Tech to Launch with First Official Meeting at Tech Hub LIVE 2023
See more events for California Energy Commission or by going to our WET Center Calendar!
Did You Know?
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