Most startup companies fail within ten years, an estimated 70% of them to be more precise. And yet every year there are also startups that take the world by storm, defying all odds to achieve the kind of success every entrepreneur dreams of. So, what are these startups doing right that everyone else is getting wrong? Is it purely lucky timing, or is there more going on? Here we look at some of the common characteristics that successful new ventures share, and how you can implement them in your own startup!
Be willing to listen
Entrepreneurs are frequently passionate people with a competitive spirit and a vision for their business – but this kind of personality can be prone to stubbornness too! Without actively seeking the advice and expertise of mentors and industry experts, and then actually listening to and acting on that advise, highly adaptive companies like Google and Apple would never be where they are today. As the leader of any organization, it’s important to understand your own weaknesses, be willing to make changes to your business plan and adapt to new market trends, even if they deviate slightly from your original vision.
Plan, Prepare, Act – then rinse and repeat
How do you define success? How will you know you’ve made it? Without measurable goals and milestones, it’s difficult to know if you’re on track and identify trends (negative or positive) in your company’s trajectory. Successful startups tend to have lots of intermediate and time-specific goals along the way, usually around every 12 to 18 months. Without these very specific milestones, startups tend to start ‘drifting’, taking each day as it comes rather than keeping their eye on growth and strategy. Once you’ve achieved one set of milestones, take a little time to celebrate your win – and then quickly get back on track to target the next one! This systematic approach to development is very evident in successful startups.
Understand the market and who your customer is
If there’s one characteristic that separates a good business idea from a bad one, it’s that it solves a problem for the customer. The most brilliantly designed and innovative product in the world isn’t going to sell if no-one actually wants it! Of course, it’s not as simple as that, but it’s a good starting point. Who are you targeting? What do they ‘look’ like, how old are they, where do they live, and how many of them are there? Once you understand them, figuring out how to market to them, address their biggest concerns and set suitable pricing models becomes a lot easier. And the more thorough your market research is, the better.
Keep your costs down consistently
A lot of the time it’s not the big investments and financial outlays you budgeted for that bring a startup down, it’s the dripping tap of small everyday expenses that didn’t make it onto the budget in the first place. If you’ve just come out of a fundraising cycle and the coffers are full, it’s all too easy to fall into the habit of spending a little bit more here and there than is strictly necessary. Keeping a close eye on expenses – or at least taking the time to review them periodically – can help you avoid falling into this trap, rather keeping extra funds available for R&D or for those months when cash flow is uncomfortably tight. Always keep your eyes open for potential cost savings, whether it’s better utility management at your premises or teleconferencing to cut down on travel costs.
Whether it’s with your customers, suppliers, industry fellows or local business leaders, networking both on- and off-line can be a great source of information and inspiration. How well do you understand each one of your customer’s businesses and what their biggest struggles are? Keeping the communication lines open and making a little extra effort here and there might not bring in revenue straight away but could lead to lasting partnerships that benefit both parties for years to come.
Believe in what you’re doing
Patience and persistence are common factors among entrepreneurs who develop really powerful brands, but persistence requires you to be motivated in the long-term. Developing, launching and running a startup is hard and often grueling work, and if you don’t really believe in what you’re doing and why you’re doing it, your enthusiasm will wane quickly. We hear about great business leaders being ‘passionate’, ‘driven’ and ‘hungry’ so often that it’s lost a lot of its impact. What you might want to focus on is your ‘why’. Why do you want to be successful in the first place? The good news is that if your why aligns with the needs of your customers, becoming successful becomes (relatively!) easy.