9 Ways to Make Your Startup Awesome—Insights from Web Summit
Have you ever wondered why so many startups fail? Actually nine out of ten. What does it take to create a startup that will succeed or let’s call it as it is—survive? I guess there is no universal receipt for success but there are a few aspects that you should take into consideration while setting up your business. After participating in Web Summit 2019 this year and listening to many inspiring startup owners like Nikolay Storonsky (Revolut), Alex Tew and Michael Acton Smith (Calm), Alan Warren (Oscar Health), we’ve decided to create our own TOP 9 factors that will help make your startup simply awesome.
Startup tip 1: Ask “why”
It doesn’t matter if your business it’s in healthcare, fintech or retail you need to do some soul-searching. Yes, soul-searching. What is your main reason for setting up this exact business? Why now? Why, out of many ideas that were in your head, you’ve decided to choose this one?
Have you heard of “The 5 Why Method” by Sakichi Toyoda, a Japanese inventor and industrialist, founder of Toyota Industries? It’s a really simple method where you need to ask yourself “why” 5 times. It helps you understand the depth of the problem you are addressing and strengthen your drive and motivation. If you haven’t done it—give it a try. When first challenges will appear of starting out the business, your purpose should be your main and stable companion.
“If something is important enough, or you believe something is important enough, even if you are scared, you will keep going.” Elon Musk, CEO of Tesla Motors and SpaceX
Startup tip 2: Know your market
Did you know that 42% of startups identified the “lack of a market need for their product” as the single biggest reason for their failure? So, once you know the main purpose of your business, you should figure out what’s the problem that your business is trying to solve and whose problem is it. Does creating a 100th meditation mobile application make sense? Well, maybe it does but you need to have the data that back up your decision. How your product differs from those that already exist?
So, before jumping into the development of your product, make sure there is a market for it. Your own desire to make your business work can’t be your main priority—your end customer should be. Go out to them and listen, if you’re lucky enough they will tell you exactly what they want. If what you have in mind doesn’t make sense, take a step back. It’s not a crime to change your mind, and it can help you avoid more damage in the future.
“Don’t find customers for your products, find products for your customers” Seth Godin, bestselling author and renowned speaker
Startup tip 3: Find a co-founder
It’s really tempting, especially at the beginning, to be a ‘one-person-team’. It’s easier to manage only yourself, and of course, this brilliant business idea is yours so why would you share it with anyone, right? Of course, you don’t need to hire 100 people if you don’t have that need but finding the right co-founder is essential for your business success. How? By bringing diversity of perspective, experience, and expertise. You can’t manage everything on your own. Even though there is a certain superhero image of an entrepreneur—doing ‘everything’ just by yourself may cost you a burnout or missing out on some great opportunity for your business.
What to keep in mind when searching for a co-founder? The first thing you need to realize is that friendship won’t make your business going. Yes, it’s important to have a friend in your business partner but what it’s more crucial is the valued alignment and chemistry between you two. You need to be sure that your co-founder will be able to challenge you as well as have your back in moments of trouble. That she/he will believe in this business as much you do.
Still not convinced? It’s worth to know that solo founders take 3.6x longer to outgrow the startup phase. The question is, how long do you want to spend on making your business profitable and sustainable?
Startup tip 4: Get the right team
“People are the most important thing. Business model and product will follow if you have the right people” Adam Neumann, Co-founder of WeWork
So you have your co-founder already—great! When your business is slowly scaling up you need to start thinking what gaps you have in your talent pool and where you can find them. Are you missing a marketer, a sales rep or maybe an engineer? Strategists or doers? Your team needs to create a combination which is reflecting your business goals and customers needs.
Adding people to your team generates extra costs so it’s natural to wonder if it’s worth it. Let’s think about it from a different angle—can you afford not hiring someone that can bring a possible breakthrough to your product?
Startup tip 5: Create your business model
Let’s be honest, business model isn’t the first thing that most entrepreneurs think about. You have a good idea, you managed to get one or maybe few investors—business is running, growing, everyone’s excited…but then something happens and the growth is slowing down, investors are dropping out and you start asking yourself where to find more revenue, from whom and with what channels?
Well, not having a proper business model might cost your startup failure or a major downside. It’s a rookie mistake that many entrepreneurs make.
Of course, you don’t need to have hundreds of spreadsheets and tools describing your model. You just need to know how your business creates, delivers and captures value, so in a moment of crisis you will be able to reach to it and find solutions.
How to do it? One of my favorite tools for business people and entrepreneurs are created by Strategizer. You can start for example with Business Model Canvas.
Startup tip 6: Growth & pivot
It’s obvious that you want to grow your startup. You want to become bigger, better, get recognized. As a startup owner you need to take risks, be ambitious, aim higher and show your people that it’s possible but.. yes there is a but, you need to be aware that you might make this one big step too soon. It’s called ’premature scaling’—70% of startups scale up too early.
Before increasing your goals, hiring more people and reaching new markets make sure that you know how to consistently acquire new customers with costs lower than revenue they bring. Make sure you have the funding secured and that the growth you are planning will be an effect of the market needs not just your own ambition.
So, you are planning your growth. The customer and market research shows you that your product might be losing relevance in some of your key markets or you are meeting new business opportunity that might not be fitting fully your current business model. What do you do? You have two options: you are ignoring your discovery and staying with what’s familiar and safe or you are deciding to pivot your business. You need to answer what it’s more important to you—your idea or the needs of people who potentially might buy your product? It’s up to you!
To prove that sometimes change might be exactly what you needed (or even more) check out these 9 successful startup pivot stories by CBInsights.
Startup tip 7: Prepare the pitch
“Don’t sell a product, sell a new way of thinking” Mark Bonchek, Shift Thinking
How many people from your organization actually know how to pitch your business? Or even a more important question—do you feel confident with selling your product? If I would give you 60 seconds to convince me that your idea is the best and I should invest in it what would you say?
Practice it’s key here so I really recommend for you to prepare before every meeting with a potential partner or an investor. You can practice with your teammates, ask for feedback. Remember that there is no “one size fits all” approach with a pitch. You need to know who you are talking to and adjust your message based on your audience.
Need more insight? Check out the piece written by TechCrunch—How to pitch startup in 60 second flat?
Startup tip 8: Don’t underestimate a good design
While functionalities and features are important you need to keep in mind that how your digital product looks and feels like is as essential as how good your code is. Many entrepreneurs are delaying work on UX and UI or trying to do it on their own. Yes, we’ve seen many designs in PowerPoint, Canva or simply as a drawing. If you are treating your customers seriously you should know that great design isn’t a luxury, rather a necessity for your product’s success.
Are you starting with MVP? Great! Check out the blog post from our Lead Designer Agnieszka— MVP Tips Every Designer Should Know.
Startup tip 9: Get the right mindset
“One of the greatest skills of leadership is being unflappable. Anytime you do anything in the world; there’s going to be criticism.” Arianna Huffington, Co-founder and Editor-in-chief of Huffington Post Media Group
You need to be ready for ups and downs, sleepless nights, successes and failures and lots of criticism or feedback you haven’t asked for (which btw can be a good thing). No, I’m not saying that an entrepreneur needs to be a hero. An entrepreneur needs to be persistent, stay open-minded, learn from her/his mistakes and—most importantly—believe in their product in a way that first challenges won’t discourage them to keep going.
What do you think of our guidelines? Do you have a startup or a product idea you need help developing? Get in touch and let’s create together!