6 reasons to start a service-based company
By Nick Huber, Co-Founder of Storage Squad
The race to be the founder of the next Facebook, Salesforce or Google is over and the kings have been crowned. Social media and technology startups are maturing fast and the truly unique concepts in these industries are few and far between.
In 2011, my partner and I founded a pickup and delivery storage company and started moving boxes around college campuses. We knew it wouldn’t be the next sexy startup featured on the front page of TechCrunch, but we saw potential and hit the ground running.
Right now, there are profitable companies in cities everywhere operating using the tools and processes they put in place in 1985 (paper invoices, cubicles, fax machines, Yellow Pages, etc.). These mature industries are ripe for new entrepreneurs who are willing to work smart, sweat, and utilize new technology to streamline processes.
Here are 6 reasons why you should drop what you are doing and start a service-based company in your city today:
- You can hit the ground running and make money right away: An entirely new idea comes with a big set of problems. Namely, you need to educate your customers on your service and then convince them that they need it. This can be expensive and requires a lot of your most valuable resource – time. In the service business, you can make this happen faster, begin operating, and learn and adjust along the way.
- The competitors are waiting to be studied: Have you ever had a job that made your head explode with all of the ways you would do things differently and more efficiently if you were the boss? You know that the customers are there and ready to utilize the service you offer. There are also competitors to study and competitors you may even consider working for. You can research and find areas with promising opportunities to gain a competitive advantage before you spend your first dollar. The data is there.
- The next Steve Jobs is not your competition: In the tech industry, you are competing with the Stanford graduates and venture backed firms with money, experience and big data behind them. You can find a niche in your city where the big players have major weaknesses that are easy to spot. The majority of entrepreneurs are focusing on the ultra competitive tech startups and ignoring the proven concepts that can be revolutionized with new processes and new tech.
- You don’t need venture capital to reach profitability: You can bootstrap the company and provide the service yourself. Get out and sweat! This will help you learn the ins and outs of each position at the company. When my partner and I founded Storage Squad, we pulled together $1500 from side jobs for a beat-up cargo van and used that to bring in quick revenue right off the bat. We still own 100% of the company today.
- You don’t need to be a software developer or computer scientist: You don’t need to be a coder to utilize the technology available to today’s businesses. WordPress lets you build a functional website in an afternoon and third-party app developers in Belarus charge $30 an hour for incredible software and app development if you do need custom tools.
- You will know quickly if it is a bust and can move on to the next idea: As an entrepreneur, time is your most valuable resource. It’s only a matter of time before you establish your first successful company. Every minute you spend before that, has a big opportunity cost. In the service industry, you’ll be able to get in front of customers and learn the business quickly and without a large investment. You’ll find out fast if it has potential or not. If it does, dig in and prepare for the ride! If it doesn’t, sell your cargo van for what you paid for it and move on to the next idea!
Go Get It!