So you’ve finally realized just how big the droniverse is– worth up to $127B by 2020— and you want to start your own drone company to stake your claim and get a piece of the pie.
First, you need to realize that starting a company in any nascent industry is as exhausting and difficult as it is exciting and rewarding. If you can accept that fact, it’s time to get down to brass tacks.
Some of the following steps are drone company specific and some are general business. The first day of Econ 101, Dr. Deak asked my class what the point of a business was. 5 hands shot up in the air with varying degrees of thoughtful and thoughtless answers. They were all wrong. The reason that businesses exist is to make a return for their investors (at this point, you’re probably the only investor). If you forget this, your drone company, or any other company for that matter will falter and then fail.
1) Define your business model.
Are you a drone designer? Manufacturer? Operator? How do you bill out? On a project basis, day rate, hourly, or something else entirely. Will you have a very narrow focus (“I shoot real residential real estate in the $1–3m dollar range”) or will you be more of a generalist (“I write software and apps for the drone users”) (See more info on business models)
2) Get the money.
You’ll need some capital, it may not be a lot, but you’ll need some. Different businesses require different amounts of initial capital but one of the cheapest is to do low-end drone services. You can incorporate, buy a consumer drone and complete FAA paperwork all for a few thousand dollars. You may be able to start assembling FPV racing drones as a service with just the tools you have on hand or building software with a computer you already own. (See more info on funding)
3) Begin your brand.
You’ll need a name and an identity; there are a lot of small drone manufacturers, operators, and software companies out there, you’ll be wise to pick a memorable and differentiated name that speaks to the brand you want to build. (See more info on branding)
4) Make your drone company a real business.
Register it and incorporate it as an LLC, S Corp or C Corp. Most sole individuals will probably choose LLC. This will remove some of the liability from you personally and make it easier for you from a tax and personal finance perspective. (See more info on registering)
5) Comply with regs.
If you’re operating drones, file with your civil aviation authority and get legit. If you’re in the United States, Read FAA Part 107 and get yourself and your business compliant. If you’re in a different country, read the rules and follow them. Nothing will kill the industry faster than dangerous and non-compliant operators. Don’t ruin the industry for all of us. (See more on FAA regulations)
6) Get good at your business.
Whether it is flying drones, building hardware or building software, you need to be good at it or you won’t make it very long. More power to you if you are the best at it. (See more about mastering your craft)
7) Start earning clients.
Build a website. Make industry contacts. Cold call. Market yourself; what does your drone company do better than anyone else? Are you better at X? Are you cheaper than Y? Think about customer pain points and how you can solve them. The drone world is already too full of solutions looking for problems. Identify a problem and devise a solution. (See more about earning clients)
8) Deliver what you promised.
Once you’ve convinced a client that you can be of value to them it’s time to get out on the dance floor and put your money where your mouth is. Like most of life, showing up is 90%. Deliver on time. Deliver on spec. And for pete sake, don’t make more complication for your clients. BE THE SOLUTION. (See more about executing projects).
9) Follow up.
Make sure that your client is happy. Happy clients talk and talking brings in more clients for you to make happy. According to Ogilvy, 74% of buyers consider Word of Mouth to be their #1 most important purchasing factor. Don’t be bashful about asking them to act as a reference.
Ultimately, starting a drone company is just like starting any other company; at Aerobo we pay a lot of attention to the basics. Don’t allow yourself to be carried away with the hoopla; the fundamentals of business are always the same. Don’t try to sell a product that has no market fit. Do know your customer and know their pain points. If you maintain focus, create & capitalize on sales opportunities, and spend accordingly, you are on your way to building a great business.
Remember Warren Buffett’s Rules 1 and 2:
Rule No.1: Never lose money. Rule No.2: Never forget rule No.1.
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