Business ideas in start-ups

In start-ups, there are a variety of business concepts to include.

Summary

            The term "start-up" refers to a form of modern entrepreneurship that focuses on bringing emerging technology and the Internet to bear on original company concepts. It progresses through the growth stage, influenced by the business concept development cycle and the funding cycle. The paper's aim is to explain and evaluate the market concept. The substance, circumstances of birth, degree of originality, and proofs of this originality are all characteristics of a business concept. Market solutions built on the use of information and networking technology rule start-ups; the business concept is most commonly developed by mixing technical and business knowledge, but its originality is just average on an international scale, and legal defense is very unusual.

introduction

          

    A start-up, a small, young, beginning enterprise with a growth perspective, is the best model for studying the transformation of a business idea into a satisfying need. Because of its simple structure, frequent metamorphoses, and rapid feedback can be used as a living laboratory in real-time. Knowing about this emerging market phenomenon can improve the chances of performance. The emergence of a concept, its development into a good or service, and its adoption by consumers is a complicated mechanism with many dead ends, unsuccessful twists, returns and reversals, setbacks topped by squandered money, dissatisfied developers, disgruntled buyers, and enraged customers, sometimes by modest achievement, and seldom by the company feat of the decade.

Company concept

          

  It is difficult to start a company, and it is even more difficult to manage one. While having a positive concept, a businessperson is discouraged due to situational and psychological factors. The desire for a steady income to support the family, the risk of wasting money, or a shortage of capital are situational factors. Danger tolerance and self-doubt are characteristics of the psychological context. Despite these obstacles, many people want to start a company because they are motivated by benefits that force them into self-employment temporarily. Job losses, differing views on the content and results of jobs in the new working arrangement, personal, occupational disputes, or unemployment, such as lack of qualification, are the most frequent. Others are enticed to enter a company for more positive purposes. They want freedom, respect, personal growth, and financial security. Since they are derived from character characteristics, these aspects have a social basis.

            It's not just a question of luck when it comes to coming up with a decent business plan. There are also methods for working out the concept in a structured manner. The entrepreneur must possess the requisite talents, talent, and experience for the company to succeed. Industry experience is precious.

            Business demands generate commercial prospects, which are the foundation of good business concepts. With little to no proof of consumer demand, opportunities may be generated by drastic or gradual product or market advances. There are many opportunities to be seen in identifying unmet consumer expectations. Both strategies are only effective if they are linked to the desires of consumers. There are three steps to the method of developing ideas:

1. An inventor is conscious of and open to as many various thoughts, influences, and individuals as possible.

2. An individual understands business prospects by watching people in their everyday life and asking them whether their desires can be addressed more effectively or not. He questions everything and tries new things. He raises concerns about the current situation and wonders how it should be handled differently.

3. He develops and refines the company concept to transform it into a sustainable business model. Not every product works right away, and not every concept is instantly economically feasible. As a result, an individual is playing with a good or service and a market concept.

            The exploration skills include associating, interviewing, listening, exploring, networking, promoting new concepts, and innovation. It takes a long time to complete the procedure. It's a time for contemplation, introspection, and concept incubation.

            It's similar to playing a game of numbers when it comes to coming up with new concepts. The more proposals generated, the more possible it is that one of them would be feasible. It's important to differentiate between strategies that maximize the quantity and those that improve efficiency. Such strategies are better at finding openings, and others are better at creating them. Brainstorming, SLEPT research, dreaming about the future, mind maps, analogy, attribute analysis, and distance analysis are the most popular and least time-consuming methods.

            The best investment ideas achieve large income while posing a minimal danger. While such prospects are uncommon, they can be evaluated using the parameters below, which are drawn from entrepreneur ambitions and skills, as well as the economic feasibility of the concept :

1. A consumer demand or void has been identified.
2. Consumers have been identified, and a marketing approach has been established.
3. There are no or just a few entrants in the market.
4. It's difficult to duplicate.
5. The marketplace is expanding.
6. Large profit margins.
7. Fixed costs are low.
8. There are few financing conditions.
9. It is possible to fund (if not sufficient resources, the project needs to attract finance).
10. Threats that can be identified, tracked, and mitigated.
11. Management abilities that can be put to good use.
12. Scalability is another important factor.

            Many first-time founders make the error of assuming that their revolutionary market concept would be similarly recognized and adopted by consumers.  Innovation is so superior that it can sell itself. There is a long way to go from the conception of an idea to its understanding, adoption, and purchasing of the good or service. A study of 120 first-time entrepreneurs revealed the most popular company start-up mistakes, possible buyer objections, and suitable sales templates for start-ups. More than half of the businesses polled said they developed the final product before getting input from customers. Creating a full product without conflict or consumer input took a long time and did not provide the desired outcomes. Customer expectations and needs must be considered at the beginning of the product creation process. While several entrepreneurs started selling early, their zeal and complacency made it difficult for them to take feedback and make the needed improvements. Successful entrepreneurs advised that consumers be patiently listened to, that they are explained what they wished to achieve, that they are offered their suggestions, and that they are continually checked. According to Block et al., the circumstances surrounding a company's inception have a long-term impact on the company. Initial policy actions almost all have long-term implications.

Objectives, test study, and research methodology

         

   The research's primary goal is to better understand start-up company concepts. According to the literature reviewed, one of the main triggers of start-up failure is a business concept that is not aligned with consumer demand. Below are the partial objectives:

1. Understand the substance of the company concept for a start-up.
2. To understand the factors that led to the genesis of the business concept.
3. Determine the uniqueness of the start-up company concept.

            Thirty start-ups in Slovakia are included in the study sample. The initial sample size was nearly a hundred start-ups, and the study was a follow-up to studies conducted in 2015, 2016, and 2017. Despite this, it had to be cut due to insufficient evidence and a lack of willingness of start-ups to commit time to study collaboration. The start-ups studied all have a similar age and are located in major cities with well-developed infrastructure and thriving start-up communities.

            Induction (deducing a general inference centered on particular knowledge) and exploration of unusual and nonrecurring patterns were included in the qualitative study of the company concept. A non-numerical approach has the benefit of strong legitimacy, as well as comprehensive and in-depth experience. Nonetheless, since the outcome does not be generalizable, it is correlated with a low-reliability drawback. The qualitative evidence was looked at to see whether there is some structure or regularity.

The findings of the research

          

  The ICT sector accounts for almost half of all start-ups. The remaining start-ups are involved in a wide range of sectors, including agricultural manufacturing, livestock, other science, machinery production, services, arts, entertainment, and leisure.

            The studied start-ups' market concepts are often material in nature and are applied as technological programs (66 percent) and goods (33 percent).

They can be classified into the following categories:

- gathering, pooling, and producing detailed knowledge and data sheets, such as assistance with CV collection, the quest for temporary human capital with specific expertise and capacities, etc.

- associating items and different artifacts with knowledge about their assets, function, and use, such as information about the status and place of ordered merchandise distribution,

- addressing conventional needs in an easier, quicker, and more convenient manner, such as a restaurant cashier system

- simple, fast, and secure access to items, buildings, apartments, and automobiles, for example, a key,

- supporting and developing innovations from other authors, such as supplying start-up facilities.

An initial, normally observable commodity that meets an established demand differently or more effectively, such as a vulnerable personal earthquake detection system or a new iteration of an existing service.

 

The conditions and reasons for the idea's emergence are mirrored in the business idea's substance. They come in a wide variety of shapes and sizes, but here are a few examples:

- the initial concept lacked commercial viability, necessitating one or more modifications (pivots), such as one application carrying many related services, from hot water wells to deep oil and gas wells; from photovoltaics to versatility, etc.

- the need for detailed and readily accessible material, such as operating technology, equipment, and computers

- the need for experts, such as in human resources management

- maintaining a sense of safety, such as face and character recognition, earthquake warnings, and so on

- In certain environments, such as the real estate industry, logistics of orders and deliveries of ready meals, etc., there is a lack of transparency.

- the entrepreneur's personal experience, such as physical or mental discomfort; a pressing need for something, such as intelligence, human resources, etc.

- the initial programs are time-consuming, inconvenient, complex, unautomated, and unconnected to other services or information systems.

            The company idea's originality is often implied, unofficially unconfirmed, and mostly fictional (90 percent of the sample). The founders' reasons for the idea's originality are varied, relying mostly on personal observations, educated guesses, and a limited understanding of the competition:

- market awareness and entrepreneurial expertise, implying that the startup under consideration is the only one in its field;

- the first of its type in a particular region, such as Central Europe,

- global uniqueness, as the country's only business

- While the principle is not particularly innovative, it is applied rapidly and reliably.

- There is a lot of demand from international customers,

- a low price, also a hundred times cheaper than the competition,

- technical complexity, albeit without the benefit of copyright,

- excellent ability to respond to the demands of the consumer

- While there are some rivals, the start-up has a large and dedicated client base.

- the offering is identical to competitors' but differs in several ways;

- The software is dynamic and difficult to understand, whether it is a mixed product.

            Just 10% of the start-ups in the survey had explicit, officially confirmed originality, and only 10% had patent rights. On a five-point scale, the degree of originality of the whole package of market concepts is 3.87, close to originality at the European level.

The following steps were used to document the progress of the company's idea:

1 - concept/idea/research,
2 - consumer research and growth
3 - the product prototype/testing,
4- initial sales,
5 - increasing earnings

            The majority of company concepts are in phases 4 (first earnings) or 5 (growing earnings); a few are in phase 3 (product prototype/testing), and only one is in phase 1. (idea and concept). On a five-point scale, the typical growth phase is 4.1, indicating that the first income stage has been reached.

            Phases 4 and 5 are marked by ongoing product advancement and development, which have occurred separately and without interruption so far. Sales are at a sluggish pace, which means that start-ups are unlikely to draw large investors. Start-ups are beginning to break into international markets, and the challenge is not just to sustain but also to greatly accelerate expansion.

            Below are the stages of the start-up finance cycle: 1 – pre-start-up capital (angel phase, no product), 2 – start-up capital (seed round, startup work, concept made/realized, interest-finding), 3 – money for the initial production, and future growth (series A/B round, 1st, 2nd stage, investment in a firm that already has clients and produces revenue), 4 – expanding capital (3rd round, mezzanine capital), 5 – IPO (public the market). The majority of company proposals (44%) emerge during the third period of the investment cycle (capital for initial development and next growth). Thirty percent of ideas are in step one (pre-starting capital), thirty percent in phase two (start-up capital), ten percent in stage four (developing capital), and three percent in phase five (IPO). On a five-point scale, the typical step of the investment period is 2.6, indicating that it is halfway between start-up money and original and growth capital.

            Around 20% of start-ups are self-funded and want to operate solely with their own money. The rest is dependent on angel and venture capitalists, who, in addition to capital, are supposed to have market expertise, guidance, and connections. Except for the start-up that secured loans from the SZRB and grants from EU ventures, no bank loans or grants are available to startups. The Flemio accelerator contributes 50,000 € in pre-launch funding, and Neurology, a startup partner, contributes 200,000 € in a regular tranche. Raising external capital is a time-consuming operation. Domestic venture capital resources are restricted, and institutional capital from global venture capital founders and strong VC funds is almost impossible to come by. Prototype production and promotion are the two areas where start-ups spend the most money. On the other hand, marketing is a catch-all word for advertisement that raises visibility about a name, a commodity, or a service. One-time contributions by VC holders are insufficient and must be replenished regularly based on product growth performance. Since advertising revenue is insufficient to fund ongoing activities and product growth, most start-ups need outside funding.

Deliberation

    

         The market concept is dominated by information and networking technology. Software apps are easier to "manufacture" and market as physical goods because they don't need a production base or many partners. They are in step with current technological developments, habits, and the spirit of the times. The triggers of the market concept are simple, such as something lacking or not functioning or a lengthy or awkward procedure. Still, an inventive visionary sees more complex material in any loss, imperfection, or absence, such as a lack of detailed details or confounding and disordered information. Personal understanding and sensitive perception of the surroundings are the most common criteria for the emergence of an idea, but is this enough to generate an original business concept? A basic issue of the investigated start-ups is the sometimes proclaimed extraordinary originality of the company concept. Unsubstantiated biases, impressions, and various individual arguments win out, resulting in failure and dissatisfaction. Self-exclude fact is often the product of a lack of understanding of the idea/topic and a failure to recognize actual rivalry on a European and global scale.

            The time it takes to create a business concept is excessive. Within three years of being created, successful start-ups worldwide can demonstrate their feasibility and then scale or leave. The analyzed start-ups have entered step 4 of the business concept formation (4.1: first income) and display no signs of exponential growth after almost five years of operation. The funding loop arrived between phases 2 and 3 (2.6: between start-up capital and capital for initial development and further growth). The market and expenditure cycles are moving in different directions. Several million euros have gone missing from the founders' pockets, and buyers are wary of the underdeveloped venture, which lacks public appeal.

final thoughts

        

    Entrepreneurship is emerging as a means for innovative and motivated individuals to realize their full potential. Traditional work relationships do not provide personal and career fulfillment, nor do they provide the ideal quality of life. Such individuals contribute to social and economic change while still providing employment opportunities for themselves and their coworkers. The emergence and growth of a market concept are among the main themes of entrepreneurship, which transforms into knowledge and qualification of its type. The degree of recognizability of the method of generating and implementing a market concept, on the other hand, is debatable. It's an innovative exercise in which using so many algorithms can result in a unified set of data and a counterproductive approach. The emphasis of research should be on identifying the favorable circumstances that promote original and unconventional strategies and distinguishing "signal-to-noise" and, therefore, the potential to interpret major patterns while avoiding banalities and missed opportunities. An investor needs to avoid being enamored by his idea's technological and practical perfection and differentiate technical advancements from business implementations. As a result, the study subject should understand how the technological approach is being designed, adjusted, and adapted for business usage and execution. It is planned to identify metrics and guidelines used to assess the idea's commercial viability tailored to its production stage and material.