YYou’re a highly skilled IT professional with a good few years of experience under you belt working at a senior level. You know exactly how much your current employer charges and you know how much (or little) you get paid.
Setting up your IT business
How to make the transition from the day job to running your own IT Business?
Invest in your education
Whether you are a programmer, network specialist or digital media content creator you will need to consider aspects of running a business that you might not have much experience of thus far. Business is more complex than most people realise, and while specialist core skills and a unique service or product offering are key, being able to handle other aspects of running a business will also determine your success or failure.
Invoicing processes, customer service, marketing, sales, communications, payroll, legal obligations, compliance and managing risk are all equally important facets of running your own business.
Moonlight before you launch
One of the appealing aspects of a service industry is that you don’t need big premises and can limit your start-up costs. Whatever kind of IT business you want to start you will need business systems, a website, marketing collateral and administration processes in place before you start. It makes sense to sort these things before you launch and while you are still employed.
We’re not suggesting that you develop your business during work hours that someone else is paying for but getting these things sorted while still having a regular income does make sense. Yes- it does mean burning the midnight oil… Sort your business plan, identify suppliers, get your branding and invoicing systems in place. That way once you quit the day job and launch your business you can concentrate on the all-important task of finding and securing clients. It might mean that you’ll be run ragged but what self-respecting IT guru sleeps normal hours anyway?
Pace yourself and be reassured by the fact that businesses that take longer to gestate are typically more successful. Working for an IT company before you set up on your own will nearly always pay dividends. Don’t assume that just because you are a hot coder and have just graduated with flying colours, that running an IT business will come easily to you. Learn about the other facets of business while being paid by an employer.
Get qualified, certified or certificated so that you can give your clients the confidence that you are professional, competent and that you really know what you are doing.
Learn from the mistakes of others
Try to a get a job in allied industry before setting up on your own, even if it’s not exactly the kind of business you plan to start. Exposure to experienced professionals, customers and back-office administration will teach you invaluable lessons about running a business.
Build your networks
Remember that business success depends on people trusting you and the only way they are going to do that is if you give them a chance to get to know you. Reach out to like-minded entrepreneurs and ask for advice, or ask them to mentor you. Develop a decent profile on social media platforms by creating content, thought leadership pieces and by responding to people asking for help. Ensure that you keep in touch with your network by contacting them on a regular basis, and keep a database or list of all your contacts. You never know what opportunities your network will bring your way if they know and respect you. Keep at it- developing a reputation of reliability and subject matter expertise takes time.
Sort the legal stuff
Make sure that you understand the legal and compliance standards of your IT business. Get to grips with legislation such as data protection and the consumer rights act. Devise terms and conditions, templates for contracts and service level agreements. If you are involved in Specialist IT services for legal, financial or other industry sectors make sure you gen up on legislation, compliance and standards for to your specific industry sector.
Part of getting the legal stuff sorted is making sure that your clients sign a contract and part of that contract should indemnify you in case you accidentally fry their motherboard! Make sure your contacts are water tight.
Research software platforms
Most IT service industries will require purchase of software licences. Owing to the innovative and fast changing nature of the sector it makes sense to research new and emerging technologies exhaustively before you launch. Wherever possible, use open source platforms to reduce your startup costs. Beware dashing out and buying expensive equipment, consider buying second hand equipment or using existing kit until your business is established.
For big ticket items, such as expensive servers or other costly equipment consider lease-hire as a way of reducing capital requirements.
Find, catch and keep customers
Many specialist technology startups struggle when it comes to marketing their business. Just because you’re the best at what you do, doesn’t mean that customers will be able to find you. Decide how you will market your business. A website is a must, but what other forms of marketing will you use? Research potential advertising channels, trade shows, affiliate marketing channels and other potential routes to market. Consider sharing premises, office resources or even people resources with another startup to keep your startup risk to a minimum.
Finding customers is largely a function of marketing, whereas catching them and keeping are the domains of sales and customer service respectively. Will you use a ticketing system for customers to request jobs with you? Whatever you decide make sure you have it all figured out before your launch.
Do your homework
Even if you think you know your subject inside out don’t take any chances- make sure that you carry out robust market research. Never assume that you know it all.
If you are providing IT support services to a niche market, SMEs or charities, doing some door to door leafleting and speaking to people directly might work better than running email campaigns. Whatever approach you take it should be determined by exhaustive research. Once you launch you won’t have the time or money to be learning via trial and error. Conducting proper research and surveying potential clients in advance of launch will help you establish the best routes to market.
Know who you are up against. Never underestimate the competition. No matter how smart you think you are someone out there is probably smarter. That’s just one reason why your market research should scrutinise the competition with forensic precision.
Work out who your market leader is and get to know their business intimately- how they sell, who they sell to, the strategies and USPs they to promote to and reach their market. There’s no need to imitate but knowing their strengths and weaknesses will help you hone and differentiate your own offering.
Of courses starting an IT business often requires serious investment. IF you've got a question about raininsng finaince why not try our FAQs on raising finance?