Chicken Soup for the Startup Soul

“I’ve missed more than 9,000 shots in my career. I’ve lost almost 300 games. 26 times I’ve been trusted to take the game-winning shot and miss. I’ve failed over and over and over again in my life, and that is why I succeed.” – Michael Jordan, NBA Legendary Basketball MVP

This quote from one of the greatest basketball players in history should also ring true for entrepreneurs. We have all heard of the successful start-ups that have made it big recently, but thousands of them didn’t. The objective should be to persevere every time you face adversity, which you will, especially with the economic conditions as dire as they are. The point is not to throw in the towel and to keep trying until you get your business where you want it to be. We have put together a few ingredients for entrepreneurs to blend for their startup success.

The idea

Starting a  business is like putting together a machine from scratch using spare parts and a lot of stop-gap measures. But you will never find a comprehensive handbook served on a platter telling you its dos and don’ts. The strength of your startup idea can be determined by people's willingness to pay for something. Though it's difficult to assess an idea's strength precisely, its originality and viability are frequently used as yardsticks. While its originality determines how much competition it will face and perhaps how thrilled people are about it, its practicality determines how much people will desire or need your products and services. 

Every entrepreneur has to go through these three definite steps or stages: identifying goals, finding the best strategy to achieve these goals, and, most importantly, executing these goals. 

Successful businesses are often built from scratch. They solve the problems of their customers. Whether you look at the likes of Facebook, Google, Tesla, or even Apple, they all started as basic ideas upon which ecosystems were built. 

Knowing your customer

After coming up with an idea, the next crucial step is to size the market. You may have to put yourself in your customer’s shoes and play the devil’s advocate. After listening to your product idea, you must ask questions that any customer could answer. 

You can do this in various ways; you can hire market researchers to do it for you. But you should do it yourself. At least a part of it, if not the whole thing. Because it will help you better understand your target consumers and give you an idea of what drives consumer demand in that particular segment. 

Methods of obtaining such information can vary, from online surveys to face-to-face interactions. However, a key nugget of information about the market you need to secure without fail is the potential bottlenecks you may face down the line. For this, you need to observe and analyze your competition. Collecting and analyzing all of this information takes time and money, but importantly, it takes a lot of patience. Hence in the initial stages, it is essential to take slow and deliberate steps.

The essential list of to-dos 

There is a list of to-dos when starting as an entrepreneur. You hire professional managers, test your concept, work on your sales pitch, decide on a business structure, organize accounts, and keep a check on your capital requirements and inventory, among other things. 

Learning to walk before you can run is especially true for entrepreneurial ventures. For instance, most aggregator firms that have done well in the last decade spent years perfecting their ground operations before kicking off their businesses. An online staples app with over 1.5 million customers spent the first two years working on ground operations. It has recently trimmed operations, but the idea is like a blueprint for anyone looking to sell online. A solid base in on-ground operations before setting out can help close any gaps in market research or customer patterns. There is a tendency to overlook simple things during the initial testing phases.

Solving the eons-old conundrum 

Entrepreneurship is a constant balancing act between aggression in achieving growth targets and patience when looking out for the proper funding. 

A fast-growing cosmetics company opened its flagship store in a metro before turning to raise money. The customer response and feedback helped the business get a sense of the market and the customer view. With that solid intelligence, it is easier to approach a potential investor. On the other hand, a digital content aggregator is looking for funding to push aggressive growth. 

The ironic thing is whether it be aggression in growth or patience in funding, too much of either is not good when it comes to entrepreneurship. You can often see one or the other but rarely see both. That is especially true now with the threat of an economic crisis and ambiguity around the covid-19 pandemic, and its after-effects loom large. You should pick the proper funding and be patient about taking risks. Risks are part and parcel of running a business, but gauging when the risk is merited and when it’s not can make or break your business. 

Ultimately, a winning idea and a go-to-market strategy are at the heart of any successful start-up. That should involve choosing customers to target, technologies to deploy, an organisational identity to assume, and a way to position the company against competitors. While all these interdependent decisions are integral to a start-up’s success, ultimately, your customers will influence your organisational vision.

The timing

All things aside, timing may very well be the most important factor for startup success. According to the founder of Idealab, Bill Gross (No no, let’s not get him confused with the bond investor Bill H. Gross), timing comes first amongst all the other factors affecting the business, team, and execution came in second, and the idea, the differentiability of the idea, the uniqueness of the idea, that actually came in third. Other factors are not as subjective, and not as difficult to harness successfully. If you rush too quickly to enter the market before looking at consumer readiness, it won't sell. If you wait too long and launch, you may lose the advantage of early brand recognition.

Understanding this unique blend of factors and executing them are two different things. Knowing that you need a great idea to succeed is important, but coming up with one is difficult, and judging the worth of an idea is even more difficult. Building a startup is not a piece of cake but knowing the factors that contributed to previous startups' success can point you in the right direction. If you're having trouble measuring these factors in your own startup, work with a mentor, and more importantly value your instincts.