A = Acquisition
An acquisition is when one company buys out another company. There are several reasons why a company may want to acquire another, but the main reason is that they want to gain more market share. Sometimes companies just don’t have enough time or money to build up their brand name, so buying an already established brand can be beneficial for both parties. Some of the most notable acquisitions in recent history include Facebook buying Instagram for $1 billion, and Google acquiring Nest Labs for $3.2 billion (Nest makes smart thermostats). For startups looking to be acquired, it’s important not only to make sure you’re providing great value or service; but also that your startup gets noticed by big companies.
B = Bootstrapping
Bootstrapping is when a business doesn’t take any outside funding (from venture capitalists or angel investors). Instead, they use their own money (or family/friends) to fund the business until it becomes profitable enough where it can support itself without any outside help. Bootstrapping has its pros & cons; taking on investor funding almost always comes with certain restrictions and terms that you must abide by – which could limit your freedom as an entrepreneur – while bootstrapping gives you full control over everything related to your product/service/company without having other people interfere with your vision. I will profit from gamification and will bootstrap if I can.
C = Crowdfunding
Crowdfunding is when a company or individual raises money by asking people to donate. Usually this involves setting up a page on sites like Kickstarter, Indiegogo, and GoFundMe where you can post your idea, product, or service and offer rewards for different donation amounts (like t-shirts, gift cards etc). Many people think crowdfunding only applies to raising money for production costs of products/projects – but it can also be used as a way to fund start-up companies. That’s exactly what I’m doing with my startup! My company is called “Klubit” – it’s an online platform that allows students to gamify college life by competing in challenges related to academics & extracurriculars through an app. To find out more about us check out klubitapp.com!
D = Diversification (or Delegation)
Diversification is all about spreading your risk across many different investments; but delegation goes one step further by spreading the work across many different workers instead of investing in other companies (or stocks). I plan on building my startup around diversification; I plan on expanding my client base as quickly as possible so that more people are interested in being involved with my product/service/company down the road – which means eventually creating multiple revenue streams from various markets. I will also delegate tasks to other people in my “team” when I feel it’s appropriate.
E = Exit Strategy
An exit strategy is a way to get out of an investment or business deal at a profit. The most common exit strategies are acquisitions, IPO (initial public offering), and liquidation. An acquisition is when one company buys out another company – this goes back to what I stated earlier about why companies might want to acquire another. IPO is when you create shares of your business that are sold on the stock market at a certain price, allowing investors who buy into your stock to have partial ownership in the company if they choose. Liquidation is when you sell all of your assets without any buyers being involved – for example, selling off everything in your inventory including furniture & computers etc… This exit strategy isn’t very common anymore but I thought it was worth mentioning!
F = Fundraising
Fundraising (or capital raising) is when a company raises money by issuing shares in exchange for cash or property. This can be used to fund the development of a product/service, or to keep it afloat if it’s not profitable enough yet. For example, if I’m bootstrapping my startup and I need money for production costs; I could either raise the money through friends and family – or by issuing stock in my company that investors can buy into. When this happens, each share of stock is worth one dollar no matter how many shares you buy – so with every share you own you’re entitled to 1% of all future proceeds from your company. If your company does well and becomes profitable then there’s a high chance that your shares will increase in value after some time has passed. So basically with fundraising you’re trying to raise an amount of money equal to what your business will need during its next period – whether it be two months from now or five years from now – so that no matter what happens there is always enough capital available for things like marketing & production costs etc… Check out this blog post on financing options for startups here!
G = Growth Hacking
Growth hacking is a term describing more advanced marketing techniques used by startups looking to grow their user base quickly without relying on traditional advertising methods like TV commercials, billboards etc.
I hope this helped you better understand the startup world and I hope my business plan was informative. If you have any questions, post them in the comments section below and I will be happy to answer them!