Opening a tech company is not easy. It takes hard work, dedication, and a lot of luck. But if you’re willing to put in the effort, you can do a few things to increase your chances of success.
Here are the 10 steps you can take to get started on building your very own tech business.
10 Steps to Launching a New Tech Business
1. Choose Your Type of Tech Business
The first step in launching a tech business is identifying the type of business you want to launch. You might choose from the following types, among others:
- Software Development
- Web or Mobile App Development
- Game Development
- Artificial Intelligence or Machine Learning
- Cloud Computing or SaaS
2. Name Your Tech Business
Give your tech business an identity so people will consider it a well-known and respected brand. You can take the name of your tech business from your industry, focus on a geographical location, or use your own name among other options.
The main goal for naming your tech business is to make it sound appealing and trustworthy so that potential customers will want to use your products or services.
3. Determine Your Tech Business Model
There are several possible types of business models for a tech business including:
- Selling products or services to consumers
- Selling products or services to businesses
- Developing and selling proprietary software
- Providing a platform for other businesses to sell their products or services
- Offering consulting or freelance services
Your business model will determine how you generate revenue and how you scale your business. It’s important to choose a business model that you’re familiar with and that will be sustainable long term.
No matter which model you choose, ensure that it aligns with your business goals and the products and services you offer.
Read more about choosing the right business model for your tech business.
4. Choose a Legal Form for Your Business
By incorporating your tech business, you will limit your liability. You can incorporate as a Limited Liability Company (LLC), a C Corporation (C-Corp), or an S Corporation (S-Corp). Or you can operate as a sole proprietorship.
The business structure you choose for your tech business will determine the taxes you pay and which state or federal tax forms you need to file.
Read our article comparing the most common tech business structures.
5. Write a Tech Business Plan
All tech business owners should develop a business plan.
A business plan is a document that outlines the goals, strategies, and operations of a business. It can be used to secure funding from investors or lenders, as well as to guide the day-to-day operations of the business. The business plan should include information on the company’s products or services, market analysis, financial projections, and management team.
When developing your tech business plan and strategy, you should think about the following questions your customers might have:
- What services or products does your tech business offer?
- Who are your target customers?
- How do you plan to reach your target customers?
- What are your long-term business goals?
- How much money do you need to get started?
- How will you generate revenue?
- What are the costs associated with starting and running your tech business?
- What are the risks and challenges associated with your tech business?
- What are your competitive advantages?
- Who is on your management team, and what are their qualifications?
For tech businesses, it’s also important to have a clear understanding of the technology you plan to use and how it will be integrated into your products or services. If you don’t have a background in technology, it’s a good idea to consult with someone who does.
Read our article about how to write a tech business plan.
6. Apply for the Necessary Permits and Licenses
There may be required licenses and permits you need to obtain before launching your tech business.
For example, if you plan to sell products online, you must obtain a sales tax permit. And if you’re selling physical products, you may need a resale license. If you’re starting a tech business operating in multiple states, you must get a multi-state business license.
You must also register your tech business as a legal entity with the state where you plan to do business. You can simply file an online form through your Secretary of State website.
Registering with the federal government is also essential so you can properly pay taxes for your business. You will also need an Employer Identification Number (EIN), which you can apply for at the IRS website, if you plan to hire employees.
7. Determine Your Budget & Apply for Funding as Needed
In developing your tech business plan, you will figure out how much funding you need to start and grow your business.
If you have your funds to invest in your tech business, you may consider taking advantage of that. In addition to your personal funds, other forms of potential funding for your tech business include traditional bank loans, SBA loans, credit cards, angel investors and family and friends.
Read our article about the costs associated with starting a tech business to help you determine if funding is needed.
8. Get the Technology & Software Needed to Run Your Business Efficiently
When you start your tech business, it’s essential to have the right technology in place to maximize efficiency. You definitely need a computer with Internet access, and accounting software for tracking expenses and revenues.
You may also want to invest in project management software and customer relationship management (CRM) software to help you manage your tech business. Of course, the specific technology and software you need will depend on the type of tech business you’re starting. But there are many options available to fit almost any budget.
Read our article about the technology and software you need to run a tech business.
9. Market Your Tech Business to Potential Clients
Before you start selling your products and services, you have to let the world know you exist. The first step is to create a website so people can learn more about your products and services and how they benefit them.
After you launch your website, start promoting it through social media channels like Facebook, LinkedIn and Twitter. Also consider networking with other people in the tech industry through social media and blogs so they can help share your business.
You also need to start gathering the materials needed to execute on your promotions strategy, which is your strategy for attracting new customers. Tech businesses should consider the following promotional strategies for which you should start getting prepared:
- Create a strong branding campaign that will help people remember your tech business.
- Develop a catchy slogan or motto to help promote your tech business.
- Produce interesting and engaging content that will attract attention to your tech business.
- Invest in digital marketing efforts, such as search engine optimization (SEO) and Google AdWords, to attract potential customers to your website.
- Get involved in trade shows and other events related to the tech industry so you can meet potential customers and partners.
- Develop relationships with media outlets to get coverage for your tech business.
- Give away free products or services as part of a contest or promotion.
There are many other marketing strategies you can use to promote your tech business. The important thing is to get started and experiment to see what works best for you.
Read our article about how to market your tech business for more tips.
10. Get New Clients & Grow Your Business
When you promote your products and services, you’ll start to get interest from potential clients.
Make sure you’re ready to serve these clients. Also, be sure to establish systems to ensure consistency and reduce costs. And be sure to find and train the right people to help you grow your tech business.
Read our article about how to effectively grow your tech business to learn more.
Starting a Tech Business FAQs
Why Start a Tech Business?
There are many reasons to start a tech business. Perhaps you’re passionate about technology and want to create products that make people’s lives better. Or maybe you see a business opportunity in the marketplace and want to capitalize on it. Whatever your reason, starting a tech business can be an enriching experience.
What is Needed to Start a Successful Tech Business?
To start a successful tech business, you need a great idea, the right team, a solid business plan, and the right technology. You also need to market your business effectively and get new clients.
How Can I Start a Tech Business From Home?
Starting a tech business from home is a great way to get started with low overhead costs. To do this, you need to have a dedicated workspace and the right technology. You should also make sure you have a good internet connection and that your family and friends are supportive of your new venture.
How Can I Start a Tech Business Online?
Starting a tech business online is a great way to reach a global market. To do this, you need to have a great website and promote your business effectively through social media and other digital channels. You should also consider investing in search engine optimization (SEO) so people can find your website easily.
What are Some Tips for Starting a Tech Business?
Here are some tips for starting a tech business:
- Find a great idea.
- Assemble the right team.
- Create a solid business plan.
- Invest in the right technology.
- Market your business effectively.
- Get new clients and grow your business
Where Can I Find a Simple Checklist for Starting a Tech Business?
A simple checklist to use when starting a tech business is as follows:
- Choose Your Type of Tech Firm: This should be based on what you are best at and how much experience you have. Remember to always keep your interests, skills, and experience in mind.
- Name Your Tech Business: This should be done carefully, as your brand is important for attracting the right customers. A simple, memorable name will go a long way.
- Choose a Legal Form for Your Business: Whether you choose to become a sole proprietorship, partnership, LLC, corporation or another option will depend on your business. Ensure that you are aware of all the implications of each type.
- Determine Your Tech Business Model: Determine how your business will make money. Will you sell products, services, or a combination of both?
- Write a Tech Business Plan: Your business plan will also help you determine what your start-up costs will be and will provide a roadmap with which you can launch and grow.
- Apply for the Necessary Permits and Licenses: In most locations you will be required to apply for a business license and/or permits before you can begin operations.
- Determine Your Budget & Apply for Funding as Needed: You will need to know how much money you have to spend on all of your business-related expenses before opening any doors. If needed, apply for a small business loan or other funding options.
- Get the Technology & Software Needed to Run Your Business Efficiently: You need to have the right tools in place to succeed. Implement software that will help you manage your time, contacts, and business operations in general.
- Market Your Tech Business to Potential Clients: A solid marketing plan will be crucial to your success. It should focus on attracting the right customers so that you can provide them with the products and services they truly need.
- Get Clients & Grow Your Business: Once you have a solid marketing plan, it's time to actively pursue and secure those who could benefit the most from your products and services.
Open a Successful Tech Company
Opening a tech company can be daunting, but if you follow the steps outlined in this article, you’ll be well on your way to starting a successful business. Research the market and take the time to create a solid business plan so you have a roadmap for success. With the right planning and execution, you can make your tech company a success.