Many start-ups fail. The list of reasons why new businesses don’t make it are many. What are the tangible things you can do to be one of the start-ups that make it?
Having a partner or partners exponentially impacts your start-up. It isn’t a 1 + 1 = 2 sum game rather the ideas, the testing of concepts and the efforts result in much more than just the time and investment of two. Find someone that believes in the business with you and who shares your values but challenges you.
You are going to have to invest in your start-up. You’ll have to put time in and it will be overwhelming.
Founders need to put resources into their start-up. Sometimes that’s money. Sometimes that means personal guarantees. It can mean you have to borrow. Almost certainly, you have to be vulnerable. Start-ups that want to grow face sharing their start-up with investors.
Some start-ups can start out slow and test the market. Ultimately if you don’t take the leap of faith on your business no one else will either. It is a rare occasion that a side-hustle grows to be more.
Nothing is for Free
It will take you more time scrambling for hand outs than it would take to learn to do it yourself. Generally, when it’s free the quality and service will reflect that. If you negotiate a price cut or free service you put your counter-party in a position that tends to lead to bitterness. No one wins. While, collaboration, networking and putting yourself out there is important they are not enought. Being a start-up is more than coffees and networks. It’s about results. Many times your own results start the ball rolling. Start-ups succeed when the founders put direct effort into getting things done.
And in turn don’t provide your product or service for free either. If your start-up needs to test and gain experience learning, that’s fine. You can do that by selling for less but never start for free.
You need to understand how your good idea resonates as value to your customer and how that will result in the start-up getting paid. In today’s high-tech world, it isn’t always straightforward. You need a model that lets you know what your key performance indicators are, how many people you need and what your upfront (or pre-revenue) costs are. You need to be able to understand the return on investment, of everything; marketing, salaries, systems, etc.
If the goal is a growing business that has value beyond the owner(s) there will be a need to establish how the revenue model changes with scale. What “levers” can be pulled to amplify your success? Where will investing in technology, process and people have
Ideas are Easy
It is not the idea that makes or breaks most start-ups. An idea where there is healthy, competitive, growing market is likely a good idea. An idea that differentiates itself and has a clear target market can be very successful. Even a simple idea that hits an underserved market can grow and be profitable. Often the difference is hustle. Someone who is willing to sit in front of a revenue model and establish a price, put pen to paper in their business plan and capture their idea on paper. Someone who grinds and finds a co-founder. An entrepreneur who invests and puts everything into it. A start-up that values other people’s time and support and pays a fair price to invest when they need the help. And if a start-up can’t afford the fair price they roll up their sleeves, learn it, do it and are better able to automate or outsource it when the time comes. They learn new things, read and try things for themselves. They then understand the value of what has to get done. A founder that is driven by curiosity and courage will lay a foundation for a growing start-up.