Basic skills for starting a business

Numbers are everywhere when you get into building a business. Some of those numbers are directly related to how a small business or startup idea receives the funding it needs to survive and someday thrive. 

Startups seem to immediately trigger the idea that venture capital is the answer. Venture-backed companies are those companies that take on investment capital in exchange for equity and ownership. These companies often get associated with the idea of high growth, which people connect to fast growth. Though small business ideas may attract less venture capital, they often require some source of outside funding in order to take shape and grow.  

The truth is that there are a lot of ways to fund a business. It’s best to explore all of the options to discover which one makes the most sense and why. Sharing ownership in a business is a big step, and the decision should not be taken lightly. There are micro loan programs like Kiva Iowa, numerous banks and credit unions, and investors that might all play a role in the long-term success of a company. Looking at a short term loan for long term success is a valid consideration. The term of these relationships matters and is also worthy of careful consideration.

There is no shortage of decisions to make, and it is critical to understand why some options might be better than others. There are plenty of people in this community that are willing and able to help navigate this process. Don’t be afraid to ask for help. 

NewBoCo and Greater Iowa City, Inc. are collaborating to deliver an educational program in the Corridor called the Business Startup Speaker Series to offer some of this help. 

The first session in that series is Business Basics 101. It covers first steps like creating a business plan and considering formation types like sole proprietorships, LLCs, etc. Some of the best advice directed to entrepreneurs was to unlock a network of mentors and advisors that can help navigate the process to be sure that the best decisions are made at the start to help increase the probability of success.

Julie Lammers, with Lambro Business Services, facilitates the Business Startup Speaker Series opening session and talks through business plans and business models, attention on differentiation, delivered value and the revenue that it takes to turn ideas and hobbies into successful, scalable businesses.

Generating revenue through the sale of goods at a price that includes a large enough margin that can sustain all aspects of the business through its stages of growth should be a basic goal. What most people find is that it isn’t always that simple, and some form of outside capital can be needed through some of these stages.

When it comes to the math of a business, it’s good advice to take the time to understand as much as you can, but also seek out mentors and advisors that will give you candid feedback about the impact decisions can have on a business.

When I started my first company, I found a great accountant and a great lawyer. Having these two skillsets on your extended team will increase the likelihood of your success. 

It goes well beyond basic math skills and dependable legal advice. Validating a business idea before you create a company and then work to scale it into a sustainable entity can be complicated and overwhelming at times. 

The good news is that the Corridor is a great place to start and grow a company, and this community is one the most supportive in the country.  

David Tominsky is the chief relationship officer at The New Bohemian Innovation Collaborative (NewBoCo).