5 Steps to Becoming a Successful Start-Up
Throughout my career I have had the fortunes of both establishing and scaling up companies together with others. This has learnt me a lot, built my character and taught me a. highly hands-on operating model creating my own successful playbook to make a startup great.
I have also been advising a bunch (50+…) of startups from various sectors, phases, B2C/B2B and countries, which I also find rewarding in what I have learnt from other founders, entrepreneurs and from a variety of businesses.
Most recently I was moderating a startup event* panel with a strong investor, entrepreneur and advisor background. Here are some of the main conclusions in form of five steps from the panel discussion that can help startups to have a recipe of success:
1. Have a strong core team
You are “nothing” without your team. You are not building alone, even though you are hands-on, have the knowledge and capabilities. Ensure to build a strong core team and that you have complimentary skills. Being a founder/co-founder in a start-up can be quite lonely. With the joint efforts you will achieve more and investors will look at the robustness of your team in their assessment for funding.
2. Focus on your own/local market
When you have your big idea and identifying the market gap, then you are probably also quantifying the market size from various sources. The Total Addressable Market (TAM) might be huge (and is of course highly relevant in the context of scalability), but keep your focus on your own local market (Serviceable Obtainable Market). Here you have your first users, who will help you with their feedback to create the MVP and beyond. It an be tempting to go early to other markets, whether adjacent geographically or more distant, e.g. from Europe it might be natural and tempting to go to the US market. But any new market introduction is costly and requires attention! Do it when you are ready. Your credibility will also increase both from customer and investor standpoint, seeing that you have built a solid local market acceptance. See also point 5.
3. Diversity is an asset
The natural interest for various sectors can be gender-weighted as an example, but from own experience and also what all panelists emphasized was that a diverse team — gender, race, nationality, experience, background etc, is an incredible asset. This can help to remove blind spots and support solving critical problems, so think about this when you are building and expanding your team. Also it is extremely rewarding working in a diverse environment, for all parties. See also point 1.
4. Don’t build everything yourself
In start-ups, I have also many times observed the own effort to build everything. That might not be the wisest strategy. For instance, expanding to new markets might require your own permanent establishment and resources on the ground. This can require a lot of resources and market knowledge. Established companies might be a win-win and quicker way to success. And if you are building something, whether apps, software or hardware — open innovation and being part of innovation ecosystems can be quicker ways to solving the issues and building your products. Collaborating tend to be the impactful way of implementing innovative solutions.
5. Get a functional MVP/product before expanding
Focus on solving a problem, then see what tools (e.g. digital and AI) that can support you to creating a unique value proposition. Your early users and customers are worth more than gold. Listen to their feedback, tweak out the faults and errors, and perfect the user experience. It brings to mind one of my mantras “don’t love your product — love your business”. If you are battling various sectors and markets in one go, you will have so many more “fires” in parallel to deal with. Get this done in your local market (point 2) and do a proper MVP, before expanding. But be agile and ready to scale fast.
Is that all?
Well, those five steps are part of the successful formula. Of course you will need support and funding, in the times of pandemics and business disruption, you need to be very agile, ready to pivot and change direction, to get traction.
Remember that you need genuine passion for your idea, the right grit and knowledge/expertise of the area is very helpful.
Having those five steps in the right shape and/or with an idea how to handle, I am sure will also open up suitable avenues for funding. I hope those steps will help you on your path building your dream.
*this event was arranged by Kiwitech. Thank you to Kiwitech, Karandeep Sodhi, and the panelists Guillaume Capelle, Elie Cohen and Mike Watson for sharing profound knowledge and for the engaging discussion.