Fintech Payments

How to make your startup a success

How to make your startup a success. Photo: Chaay_Tee, Shutterstock.com
Written by Chris Skinner

It’s easier than ever to become a merchant, says Chris Skinner, who runs through the process of taking your business from craft fair to world domination.

You have an idea. Let’s say that it’s to make nice, wooden caricatures of famous politicians – something that historically would have been a niche trade for the odd craft fair. It still is, but when you go to a craft fare, the usual practice is cash only. Not any more. In just a few short years, we’ve seen most stall holders move from only dealing in cash to being able to take debit, credit, EMV and magnetic card payments thanks to PayPal, Square, iZettle and more. It’s now easy, as long as there’s a network signal around. This is transformational, because it means anyone can become a merchant.

Now let’s say that your wooden caricatures are selling so well that you can’t keep up. What to do? Well, move to sourcing the production from a bigger facility, and the easiest and most cost-effective place to start a search for suppliers is on the internet via B2B sourcing platforms such as Alibaba, Global Sources and Made-in-China.com. So now you’ve moved your production to China and you have thousands of caricatures being made, but that’s now too much for craft fairs. You need an online store. Easy. Again, you can find website designers, search engine optimisers and more, or just become a seller on Amazon or eBay.

Equally, you want to get your product known, so you come up with an idea for a model of the Houses of Parliament, Capital Hill and more, all made in wood. You can then arrange your house of funny politicians in front of the buildings in which they reside. There’s a problem, though: your Chinese suppliers say that just producing a hundred of each building will cost $500 each, and you don’t have $50,000 funding to get started. Easy. Just launch an Indiegogo or Kickstarter campaign to get it funded. You now have your market of potential customers directly funding your idea, and no longer need to plead with a bank manager to get starter funding. It’s sourced directly from your customers.

The checkout process

All is going well, so you decide to move ahead with creating a dedicated online store for your wooden politicians, and expand into wooden celebrities and more. The store looks great, but the checkout process is difficult. The bank has no ideas on how to help, but you hear that there are services out there such as Stripe and Klarna that make it easy. For example, Stripe generally can be added to any merchant’s website in minutes and makes checkout easy with a great user interface.

You’re all set. You’ve got a great manufacturing outfit doing all the work in China (sourced through Alibaba), a growing, core, loyal customer base (who funded you to get started via Kickstarter), a great website with easy purchasing (via Stripe), recognition as one of the bestselling novelty products (through your listings on Amazon), and a strong presence as craft fair merchant of the year (through the analytics of your Square sales metrics).

Today, the village craft fair –  tomorrow, the world. And no, it’s no joke.

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– This article is reproduced with kind permission. Some minor changes have been made to reflect BankNXT style considerations. Read more here. This particular post is brought to you by Sage Payment Solutions and IDG. The views and opinions expressed herein are those of the author and do not necessarily represent the views and opinions of Sage Payment Solutions. Photo: Chaay_Tee, Shutterstock.com

About the author

Chris Skinner

Chris Skinner is an independent commentator on the financial markets through the Finanser, and chair of the European networking forum the Financial Services Club, which he founded in 2004. He is an author of numerous books covering everything from European regulations in banking through to the credit crisis, to the future of banking.

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