Secrets of Successful Startups Revealed
The few extraordinary organizations that succeed among startups share some common characteristics that enable them to withstand the unpredictable and fluctuating business environment and come out with flying colors. The starting point for every single successful enterprise is a convincing business idea. Starting a successful company requires a strong blend of three important elements: business idea, management team, and capital. A visionary leadership and a customer centric approach with a keen understanding of the domain are the other important pillars of a successful startup. Here is a list of the important things that successful startups do right:
People say you have to have a lot of passion for what you are doing and its totally true. The reason is, because it’s so hard, any rational person would give up. It’s really hard. You have to do it over a sustained period of time. If you don’t love it, you don’t have fun doing it, you are gonna give up. – Steve Jobs, late co-founder, chairman and CEO, Apple Inc.
A successful startup is typically started by a founder or a group of founders who are passionate about a particular idea and are willing to go to any length to carry their vision forward and materialize their dreams. Such founders have strong leadership and communication skills that enable them to build up a passionate, enthusiastic team and establish great relations with potential investors and partners. As American businessman Mark Cuban of the TV show Shark Tank fame emphatically declares, don’t work on a startup or establish one unless it is the thing that you really want to do.
Founders of most successful companies are known to have extensive experience into their target domain. They do not try to do too many things at once and have a laser focus on achieving that one thing, that one problem that want to solve, that would make them stand out from the competition.
They put all their focus in finding out the solution to a problem and have a burning desire to succeed in transforming their idea into reality. They are a great inspiration for their team members and drive them to perform at their best.
Innovative Idea / Product
“We used to write this down by saying, ‘move fast and break things.’ And the idea was, unless you are breaking some stuff you are not moving fast enough. I think there’s probably something in that for other entrepreneurs to learn which is that making mistakes is okay. At the end of the day, the goal of building something is to build something, not to not make mistakes.” – Mark Zuckerberg, CEO, Facebook.
Most successful startups made their mark in the industry by achieving this one thing- to identify a problem and fill that gap in an innovative manner, thereby creating an opportunity for the customers and themselves too. However, an idea only serves to mark the beginning of a long and herculean task of undergoing the lengthy process of arriving towards a mature business idea that can surmount the challenges that it must face before it can get a go ahead from the investors and stakeholders.
Successful startups are able to change and adapt themselves to the changing market trends including changing customer needs, rising competition and new technology and determine what works and what doesn’t, thereby always staying ahead of the ‘curve’. There are several instances to demonstrate how some of the startups banked on the innovations and technological advances that were first ignored and turned down by some of the industry giants. Successful companies are able to hit the bull’s eye, when it comes to timing their product for market penetration. They have the foresight and the vision to sense a strong demand for their product or technology in their chosen market, enhancing their chances for rapid growth and scaling of their business.
Teams outperform individuals, especially when performance requires multiple skills, judgments, and experiences. – Jon R. Katzenbach, Author, Consultant, Founder – Katzenbach Partners LLC
Even the most gifted of entrepreneurs can’t do it all by themselves. As Steve Jobs emphatically declared, “The secret of my success is that we have gone to exceptional lengths to hire the best people in the world.” A great team that believes in the business idea and works passionately to give in the best is probably the single most essential factor in deciding a startups success or failure. A great start up has a team of people who are creative and motivated enough to overcome any hurdles with their strong domain knowledge and skill sets. Successful startups do all it takes to create a work atmosphere which is conductive to attracting the best talent available and providing the team members workforce a challenging and fulfilling work environment.
Several award-winning entrepreneurs are known to be extremely kind, supportive and encouraging towards the employees thereby keeping them happy, productive and performing at their best. Establishing a culture that has shared values, and is positive and inspiring goes a long way in establishing an awesome team. Doug Conant, CEO, Campbell’s Soup, emphasizes,“To win in the marketplace you must first win in the workplace.”
Customer is King
If you don’t know what the customer benefit is, the whole thing’s a waste of time. – Branco Weiss, Swiss entrepreneur.
Most successful startups succeeded by placing their entire focus on providing great customer experience. They were able to develop mind-blowing products and services by understanding what the customers really wanted and were able to provide solutions that could positively impact the society in more ways than one. Listening and interacting with the customers to collect their feedback along with being transparent and honest in their dealings can go a long way in retaining and winning customer loyalty. Trust Microsoft co-founder Bill Gates when he says, “Your most unhappy customers are your greatest source of learning.”
Successful startups are able to enhance the customer life cycle value by constantly catering to the changing customer needs and providing services that better suit customer expectations. Successful startups believe in growing along with their customers. They understand that their customers have chosen their products or services after analyzing the competitor’s offerings and hence expect the company to deliver the best. Such startups establish close relationships with the customers and take great efforts to put together customer feedback and user experience into evolving their products further. As celebrated entrepreneur Damon Richards wisely remarks, “Your customer doesn’t care how much you know until they know how much you care.“
Building Partnerships & Raising Capital
“Money is like gasoline during a road trip. You don’t want to run out of gas on your trip, but you’re not doing a tour of gas stations.” – Tim O’Reilly, O’Reilly Media founder
Great startups realize that without finding reliable investors and establishing strong partnerships with other stakeholders, it’s nearly impossible to fuel the growth of the company. They make sure that they are in control of most of the decision making process and if they do decide to raise venture capital, they make sure to find investors that can help them further build their brand and develop their professional network. When is the best time to ask for money? Here is some sound advice by Michael Seibel, presently full-time partner at startup accelerator, Y Combinator, “Investors like to invest based on traction, so it’s always better to raise money when you’ve got more traction than less.”
“Stay self-funded as long as possible.” – Garrett Camp, Canadian entrepreneur, StumbleUpon co-founder. Many successful startups believe in self-funding their growth, until they decide to go for an expansion. With no dearth of capital available in the market to support businesses that have a unique business idea and look promising, the good startups make sure to arrive at very attractive investment terms. They see their business idea from the investor’s perspective and ascertain that the company’s vision and business plans make a good fit with the investors and venture capitalists.
Sales & Marketing Strategy
“Your goal should be to get to a Yes or No as quickly as you can, where you die if you have a thousand maybes.” Tyler Bosmeny, CEO and Co-Founder, Clever.
All the startups that are able to make it to the top are able to create the right product at the right time and reach the right kind of people. They are able to win the customers by emphasizing why they are better than the competition and that their idea is a winning combination of uniqueness, innovation and better value for money. Even though tied up with a shoestring budget, they are able to advertise and promote their product or brand and achieve the desired sales growth.
“Good service leads to multiple sales. If you take good care of your customers, they will open doors you could never open by yourself,” remarkable words by Jim Rohn, late American entrepreneur. The successful startups have unique business models that they keep evolving to form a clear, flexible and efficient business plan. They generate their revenue streams from a variety of sources and establish mutually rewarding partnerships with investors and other stakeholders.
They consistently monitor changing customer needs, competitor’s offerings and evolving technology and are always a step ahead of potential threats and opportunities that enable them to modify and evolve theirs products to sustain aggressive growth curves. Successful startups are able to find that perfect blend of a great product and great marketing. In this age of social media and digital marketing, the great startups make sure that they are able to strategically place their brand or product into their target market. They are able to successfully develop their brand and make it stand out from the crowd and mean ‘something different’.