How to found a company
There hasn’t been a blog post here on Emerald Berlin for far too long, although we have actually planned to introduce you to a new exciting topic every week.
In the last weeks a lot has happened here. Much of it you will see and experience in the next weeks and months.
After almost a year, we’re still far from where we want to be, but we’re still a long way off. And we owe a great deal of that to your support.
I think we have said this a few times, but it makes us very proud again and again.
But now to your questions about entrepreneurship that you asked us about Instagram. We’ve decided that it’s probably best to summarize them in a blog post for you to read again and again. We have tried to keep the questions as unchanged as possible but still bundle them.
Of course we answer all questions from our very own personal perspective and with the background knowledge and experience we have gained here in our company. Other founders would give you possibly completely different answers. You should therefore consider our answers only as inspiration, but never as ultimate or given.
If you have any further questions, feel free to contact us.
But now it’s really on.
- 1. Is it difficult to start a business?
I don’t think any question is asked more often than this one. That’s why I chose it as an initial question. And I have to say, even if this question is asked again and again, I don’t have a really perfect answer to it. I could say yes now, because if you look only at the effort involved in setting up the company, then that is definitely the case. What often makes it difficult is our head. Starting a business cannot be compared to a normal job. And actually not so easy to describe. Someone very clever once told me that he has always felt his start-ups to be a roller coaster. And I can only agree with that. It’s the most emotional roller coaster ride I’ve ever experienced. You constantly have the feeling that you want to change something here and there, often you don’t sleep and worry whether you can do what makes you so happy the next day. From the outside you get feedback of every kind and that is sometimes not easy to classify. All in all, it’s a really great experience to have found a way to deal with these strong emotions. So whether it’s easy or difficult for you personally, everyone has to answer for himself.
- 2. is it really more difficult to start a business as a woman and is it even worth it?
The foundation is by no means more difficult. In any case, there are inequalities in everything that follows, and more about that, but the foundation itself is the same. And is it worth it? YES!
3. What does it really look like with funding if you are a woman?
Here, too, there is probably no master’s answer. If you believe the statistics, then it clearly emerges that there are clear disadvantages here.
In general, we live in a very privileged country where a lot is possible. Of course, at this point we have to say once again that we are still a long way from what could be described as genuine equality. And that is not only a statistical truth, but also a perceived truth. Nevertheless, I believe that to a large extent it also depends on us how we deal with it. For me, equality has always been something that I actively demand. Not so much in extensive protest but rather through my behaviour in everyday life. And even when I founded my company, I never allowed myself to be led astray by statistics. It was always clear to me that I could achieve anything if I only wanted to. And with security the way could be simpler. Or shorter and smoother. The fact is, however, that once I have walked the path, I can make it easier for other women by showing that it should never be about gender, skin colour or origin, but always about the performance of the individual person. But if I had to answer the question in one sentence, then I would say: Yes – there is absolutely still a lot that needs to be improved. But I also know a few women who have made it and been able to build successful companies.
4. What is funding?
If you have a lot to do with company founders, then funding is probably the word you hear most after Blockchain and Crypto. Funding describes the process of corporate financing. One distinguishes here around example between
– Equity capital – e.g. savings
– Friends & Family Capital – Private loans, which most founders use for their start-up.
– Bank loans – Loans and subsidies from banks
– Businessangel – Private investors who want to invest in your company. Most of the time these are also investments that are made especially in the beginning, because through the initial rapid growth here very good returns can be earned.
– VC Capital – financial companies that usually invest large sums of money and want to expand their business quickly in order to generate the highest possible returns.
– Equity investments – Sometimes these are also other companies that would like to have shares in another company. There are various reasons for this, such as a planned takeover at a later date, control or diversification.
- 5. What makes a good founder?
I don’t think we can give a general answer here either. I once heard that a good founder is someone you should be afraid of because he or she will overrun the market. At first, I thought to myself, „What is this all about? But the more I think about it, the more I recognize something in this statement that I am quite willing to confirm. And that is that you should have a strong will to give your idea the necessary space. Because there are many great products. But only those that are seen can survive. I am an introverted person. I have to overcome a lot in order to put myself in the centre of my idea and give it more personality. But, and this is the part you usually don’t see directly in our stories etc., I try to push Emerald forward every day. And I think if you’re not willing to do that, then maybe reasoning isn’t the most obvious option. But here, too, there are certainly examples that show that it doesn’t have to be a property that you should have. In the end, I think the main thing is: Do you have the desire to do it? Are you willing to give up some things like money and free time in your life for quite a while? Then go for it. No? then maybe think about it again.
- 6. How much starting capital should I have to start a business?
That depends entirely on your founding idea. I always recommend making a business financial plan. At Gründer.com, for example, there are very good templates that enable you to determine the capital requirements of your idea.
In addition, you should consider how you can possibly use other techniques to work within budget.
For example, we are currently working with an existing basic product. Why are we doing this? Because we wanted to use a very sustainable product right from the start. However, this is extremely difficult and extremely costly in production. In addition, there are high storage costs and logistical challenges that we could not have afforded. Our current model has the advantage that we can offer you a lot of choice right from the start, without having to fear delivery bottlenecks. The disadvantage of such a moment, however, is the unit cost, which is significantly higher than what would be possible with our own production. You see, every medal has two sides. But unfortunately you always have to decide for one. At least for the start.
- 7. How do you start when you have an idea?
I think the best way to „test“ your idea is to talk to friends, family and strangers about your idea. In many cities there are regulars‘ tables and events of various kinds where you have the opportunity to do so. For example, choose places where you can get to know founders who are going in a similar direction to you. In my case this was Social Business (SocEnt).
Most ideas are not perfect from the beginning. Therefore I find it incredibly important to collect all ideas and objections and try to quantify them.
In the next step I always recommend to do a brand workshop and to work out the most important values of your brand. You can choose exercises online or take part in a guided workshop. If you have any questions, feel free to contact me, as I regularly offer workshops of this kind.
At the end you should have the following:
Afterwards, I find it particularly helpful to sit down to a business plan. Here, too, there are templates on the net that can be used as a basis for structuring. The business plan forces you to really deal with all topics of a start-up.
Your pre-founding phase should then begin actively. At which point in time you actually set up your company is very much dependent on what you do exactly. In any case, you should make sure that you start up first and then generate sales. You should also check individually which legal form you choose.
When I was founded, I had a variety of coaching sessions. And even if I can’t recommend every one of them, I would always recommend it. Because as I wrote briefly above – reasoning is much more emotional than you can imagine.
Again, not every coaching is the right thing for every person and every idea.
For example, I had one with my dear Laura, who I was introduced to through Project Together, who exclusively give free coaching sessions to social ideas.
- 8. When should I quit my job?
Quite simply: The moment you have the feeling that you no longer want to do the other and feel able to do so.
- 9. Can everyone start a company?
Yes. Everyone who really wants it.
10. How do you get to know other founders?
My recommendations would be: Events, regulars‘ tables, networks, Co-Workingspaces, Social Media. Surely there are a few more.
11. How many team members do I need to start a business?
That depends entirely on your idea. I started Emerald on my own. At the same time I had a lot of friends who were willing to support me. And that was really extremely important. Thomas joined me after about 6 months. Even today we still have help from outside, book freelancers and are looking for more team members.
But my Learing was that in the best case I wouldn’t be alone anymore. Not because you can’t make it, but because it’s simply more pleasant to share all the emotions you have with someone who can understand it 1:1.
12. How much bureaucracy is involved in setting up a business?
That also depends on your idea. But as a rule everything is manageable. There are online instructions for all legal forms that you can use to orientate yourself.
- 13. Have you always wanted to start a business?
I think so. Yes. I offered baby-sitting as a child and earned my own money very early on. I’ve always had endless ideas and a lot of fun implementing them.
14. What is the best feeling when you have founded a company?
Difficult question. Actually almost everything is beautiful – But maybe it’s most beautiful when you realize for the first time that there are people you don’t know who support you because they think your idea is great. In my case it is of course the cooperation with the NGOs that makes me happy and the feeling that I can really change something.
- 15. do you have self-doubt?
Every day. Every hour. Every minute. But that doesn’t matter. Because I believe you can only grow through self-doubt. You constantly question yourself and your idea and are ready to learn a lot every day. But of course there are also days when I’m not happy about it. The days when self-doubt cannot so easily be transformed into positive energy. But I also think that’s ok. On those days I am lucky to have friends who tell me that I chose all this for a certain reason. And mostly that’s enough to continue the next day with a lot of fun and joy.
- 16. Do you regret your decision sometimes?
No. In fact, I regret almost nothing in my life. But sometimes I wonder why I do all this and why I don’t just go back to a very well paid job with more or less fixed working hours. And I always end up with the same answer to myself: Because that’s simply not an option.
I very much hope that my answers will help you. If you have any further questions, please ask them any time. Even if you are still a long way from even considering starting a business.