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What are the different stages of a startup?

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Image shows a person thinkng about a startup and staring at a wall covered in yellow post-it notes. Photo courtesy Geekdom.

Have a killer idea for a product or a service? Are you thinking of launching a startup?

You probably have lots of questions.

When should you launch your product? How do you know if your product is ready for market? When should you scale? When do you start talking to investors? 

Every stage has new milestones and requirements, and being aware of them can help keep your startup on track for success. Before you dive into the world of entrepreneurship, here’s what you need to know about the business lifecycle of a startup.

There are four stages in the life of a startup.

Founders typically develop and mature their startup ideas in an established order. Most startups go through four basic stages of development:

  • Ideation phase
  • Cultivation phase
  • Shaping phase, and 
  • Growing phase.

Let’s discuss what happens in each stage.

First, you must ideate your startup

The first stage for any startup is taking a hard look at your idea to find a good fit between the problem you’re trying to address and your solution. Refine your startup’s problem-solution fit by sharing it with many potential customers or focus groups. Talking to market experts and consultants helps you tap into their knowledge base for insights into the industry and market trends. Remember, you need to assess how your idea fits with the market.

This is also the time to capture your startup’s business model in writing. Consider using Lean Canvas, a one-page business plan template created by Ash Maurya. The discipline of describing your company in a single-page business plan helps you deconstruct your idea into its key assumptions. 

This first phase of any startup is also the time to develop your minimum viable product. Your MVP should have enough features to attract early-adopter customers and validate a product idea early in the product development cycle.

Regardless if you’re seeking initial seed funding or bootstrapping your company’s launch, the ideation phase is when you collect enough evidence to secure funding for the subsequent growth phases. 

Time to cultivate your idea into a company

Turning your idea into reality for a market launch means you’ll need to form a company. Your legal structure can impact what you’re liable for and the taxes you pay. Depending on your business, you may have other requirements to ensure your business operates legally. Consult with a startup-savvy lawyer to explore your options and decide the best structure for your new startup.

If you are going to define your product’s positioning in the market and with your target users, you’ll also need ways to convey your startup’s information.

A pitch deck is a brief presentation, often created in Google Slides, Keynote, Canva, or Prezi. It provides your audience with a synopsis of your business plan. You’ll often use your deck during face-to-face or online meetings with potential investors, customers, partners, and co-founders. It’s also a good time to set up a website and social media channels to ensure potential customers can find your business online. 

As you launch your startup in the Cultivation phase, remember to evaluate the user experience. This may involve testing and evolving various components of your offering, including the sales process and how potential and actual customers access your product or service. This might include assessing how customers enter and walk around a physical location. Or, this could include how your customers navigate your website.

Shaping your ideas into a thriving startup 

When you’re shaping your startup at this point, you’ve had a successful launch and are growing your user base. However, you may notice you’re still struggling.

If you’re struggling, you may ask whether you need to add a co-founder to your company. You may need to find one with complementary skills to address gaps in your startup’s core competencies. Co-founders should share the same passion but be different enough to help with each other’s weaknesses.

Fundraising will also be on your to-do list at this point. Which funding route makes the most sense for you and your startup will vary depending on your circumstances? You’ll be raising the funds to fuel your short-term and long-term goals.

That means you’ll also need to create an investor pitch deck and start scheduling meetings and calls with venture capitalists and angel investors. 

Consider applying to a startup accelerator. These intense programs support early-stage, growth-driven companies through education, mentorship, and financing. Startups enter accelerators for a fixed period and as part of a cohort of companies. The accelerator experience is a process of intense, rapid, and immersive education aimed at accelerating the life cycle of young innovative companies, compressing years’ worth of learning by doing into just a few months.

Growing your startup into a mature company

In the growth stage, your business should be focused on generating a consistent source of funds while also striving to reach new customers.  Here, the biggest hurdle is dividing time between demands that require your attention, such as identifying and pursuing new customers, managing increasing revenue, helping customers, evolving the product or service, administration of the business, outsmarting the competition, and even scaling globally while doing all these things.

Until your startup is large enough and doing well for a dedicated office space, consider a co-working space or renting a shared office like those available at Geekdom. These environments are great for networking, hosting events, and rubbing elbows with other startups.

You’ll also need to keep up to date with what’s happening in your industry, catch up on books or podcasts that successful entrepreneurs leverage, and build new skills you’ll need as a CEO. Building your “tribe” of mentors who share wisdom with you regularly can help you grow your business. Busy CEOs often benefit from leadership coaching or a good business mentor.

What’s next? Join a startup community!

Launching a startup company is not easy. However, you can learn the basics of how to start a startup. Surrounding yourself with the right community of people can also help you on your journey as a founder.

If you’re looking for resources to build your business, connections to grow your network, or inspiration to spark your next great idea, we’ve got you covered.

You can start by learning more about launching your startup. Download our free Geekdom Startup Guidebook here

Check out our monthly Startup Day at Geekdom if you’re in San Antonio, Texas. It’s for anyone interested in getting more involved in San Antonio’s entrepreneurial startup scene. Enjoy a full day of free coworking community at Geekdom as you explore opportunities.

Once you’re ready to launch yourself into startup life, consider applying for one of Geekdom’s programs to get you started on your entrepreneurial journey.

The featured image is of a person staring at a wall covered in yellow post-it notes—photo courtesy Geekdom.

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