Every new entrepreneur with a solid business model, strong work ethic and the right amount of persistence has a recipe for success. But relying strictly on drive and revenue isn’t enough to sustain or grow a startup for the long term. For that, it’s wise to start investing to build equity in your business.
The right investment strategy can help you build a good financial platform for your company as well as help your business evolve. Some investments might cost you in the beginning, but the best ones can produce substantial returns.
Whether you’re a newbie or a veteran, here are five essentials every entrepreneur should consider investing in.
1. Competitive Analysis
No successful company operates in a vacuum. To ensure continued success, you have to keep a close eye on your competitors. What are their strengths and weaknesses, their advantages or disadvantages, and how do you measure up? Conducting an in-depth analysis of the competitors in your vertical can help uncover new strategies or market changes you can use to differentiate your company and stay relevant in your industry. By understanding your rivals, you can better understand yourself.
Useful, thorough competitive analyses require time and money. Hiring an investment or marketing firm is an option that can save your own team time because the external firm can do all the research and data mining for you. If that option is cost prohibitive, however, you can conduct your own analysis through surveys and polls and by studying your competitors’ advertising methods, messaging and branding.
A competitive analysis can give you a clearer view of where your company stands, what your objectives are and what direction you can take next. In the process, you can gain deeper insights into your customers’ needs and gauge your bottom line to help you formulate new business goals.
2. Social Media and Publicity
Customers won’t come knocking if they don’t know you exist — and no amount of magical thinking will create new business opportunities. Part of creating business buzz is making yourself more visible, and the simplest step to achieve that is developing a social media presence and engaging with your customer base.
First, you need to make sure your website is up to date. Whether using your own staff or a reputable Web designer, invest the resources necessary to make sure your site is mobile friendly, equipped with user-friendly click-to-call and sign-up features, and designed to convert site visitors into paying customers.
Next, take to Facebook, LinkedIn, Twitter and other social media platforms to start building visibility. Pick your platforms carefully so that you target your efforts on sites where your customer base is active and avoid wasting your time and posts on sites that aren’t suited to your product, service or brand.
Leverage social media to drum up business, educate potential customers about your products and services, and engage with customers to build brand loyalty. Investing some money into Facebook ads, for instance, can jump-start buzz around your brand and not only get your name in front of new customers but also keep it in front of past customers to generate repeat business.
3. Smart People
Attracting the best talent can keep productivity high and goals on target. The right employees and associates can help you maintain a higher quality standard throughout every facet of your business operations, from idea generation and task execution to big-picture collaboration and workplace morale.
Nurturing your team so that growth doesn’t become stagnant is key. Smart staffers and contractors can become smarter when you invest in their professional development. Consider paying to provide them with online or offsite training courses to expand their skill sets. Send specific employees to professional conferences to gain information and business leads that could benefit your company.
Additionally, simply investing the time to provide one-on-one feedback, quarterly evaluations and team-building exercises is a cost-effective way to retain a sharp team that contributes to your shared success. You also should never stop learning. Warren Buffett, for example, reads for hours every day, and Mark Zuckerberg learned to speak Mandarin in order to facilitate better communication with clients in Asia. Maintaining an enthusiasm for learning can help you increase your own contributions to your business.
4. Great Technology
One way to easily fall behind your competition is by failing to take advantage of new technology. Simple investments in bookkeeping or time-tracking software, new computer hardware and software can help increase your company’s productivity. Making sure your team has the tools it needs, from high-speed Internet to well-maintained production-line machinery, can save you time at every step of your supply chain.
For point-of-sale vendors, investing in touch screen payment platforms like Square Cash or a tablet cash register, for example, can help boost your bottom line by making you accessible to a larger number of customers. And programs like Bidsketch can cut down the time it takes to draft proposals, send and receive documentation, and obtain signatures. These types of internal investments in technology can make a significant difference to how your business functions and is perceived externally.
5. Other Startups
If you’re in need of financing, various websites can connect entrepreneurs and startups with investors. Angel investors, for example, can give entrepreneurs the capital they need in exchange for a stake in the business. AngelList has rapidly become a popular online source of investors as wells as crowdfunding outlets such as Indiegogo, Kickstarter and Wefunder.
When your success affords you the opportunity to help others the same way an investor helped your startup, you can experience a new level of success. Investing to support new and emerging startups in their journey can aid you in networking with other entrepreneurs and investors, which is a savvy way to continue enhancing your brand. In the process, you can keep up with new business strategies and technology that can keep you viable and vital in the years to come.
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The First 5 Things Every Entrepreneur Should Invest In originally appeared on usnews.com
