Software is one of the best businesses to start. Besides brick-and-mortar stores and grocery stores, software companys are always needed in our technology-driven world. Starting a software company can open doors to a wide network of other like-minded professionals. It can create a big impact on many people around the world. The product even has the opportunity to evolve at a faster pace to keep up with the times versus a physical product.
Software can be considered as a computer program, a web-based program, or a mobile app. You have different options to choose from depending on your idea. Here are seven steps to consider when starting a software company of your own.
An Innovative Idea
Every business starts with a unique idea. The more unique your idea is to the marketplace, the higher chance of success you’ll have. Competitor analysis is crucial in the idea stage of a business, especially for a software startup. There are thousands of software companies out there. Drilling down and finding a niche or audience that your software can best serve is key to creating an innovative software idea.
Business, Accounting, and Legal Setup
All startups need their business to be set up, including the appropriate business entity, bank account setup, and any necessary licenses based on your location and state. A business lawyer and business accountant can help with this setup.
Do you plan to start this business alone, or do you plan to have a partner or group as a founding team? The bigger your founding team is, the faster the business will grow.
In the case of a software business, product development is the programming of the software itself. This stage depends on how complex the programming is, as well as if you need to have other businesses integrated into the software, such as if you plan to create an app that will integrate into the backend of websites, you’ll need to work directly with the website’s server.
Marketing and Advertising Budget
Many startup businesses across all industries fail to plan for a marketing and advertising budget. Just because you build your software and have it ready for sale doesn’t mean people will know about it. A marketing and advertising budget allows for the best possible chance at growing your business. Word-of-mouth is the most reliable form of marketing, but can take longer to build up if you’re just starting.
The faster you want or need your software startup to grow, the more you’ll need investors to fund your business. There are many ways to go about securing funding, including individual angel investors, venture capital, or even applying for a business accelerator. There are many investors specifically looking for software companies to fund because the overall startup cost is lower than a physical product business.
You’ll need multiple launch plans to properly get your software into the marketplace. Your beta launch plan can consist of a small group of users to test the software to determine any bugs. Once the fixes are complete, a gamma launch may be needed if you feel more field testing is required, or you can go straight to a public launch. Having a plan for each launch stage depending on the circumstance is crucial for a successful public launch at the end.
Starting a software company is both exciting and scary, especially if this is your first time creating a business or you’re new to the software industry. The rewards of starting a software business greatly outweigh the risk both in the short and long term.