It is a sad fact that most startups are not a success. In fact, according to Shikhar Ghosh, a senior lecturer at Harvard Business School, the failure rate of startups is as high as 30-40%. New business owners will want to avoid becoming part of that statistic. But what can you do to avoid it happening?
Here are some tips to help you land on the right side of that statistic.
15 Tips for a Successful Startup
1. Know Why You Exist
What needs do people have that your startup fulfils? Why should people care about you? These are two fundamental questions that you should be able to answer if you want to succeed.
2. Believe In Yourself
Doubt is a recipe for failure, so you need to have self-belief. If you know that you are doing all you can to succeed with your business, you will feel your confidence grow.
3. Believe in What You’re Doing
If your heart’s not in what you are doing, you are more likely to walk away when the going gets tough. Do something that you love and your resolve to stick to it will be much stronger. Your working week at a startup is likely to be longer than 40 hours so make sure you are happy to dive into it with both feet.
4. Always Seek to Learn
Criticism can be a source of education. So can mistakes. And taking innovative approaches forces you to learn as you go. No matter how you proceed, make sure you are always learning. Complacency can lead to stagnation and missed opportunities.
5. Understand Your Customers
You don’t have a psychic ability to know what your customers want. Research is important and it doesn’t necessarily require a big budget. Scour forums, ask questions on social media and conduct surveys to get opinions. Everything you learn is valuable information.
6. Prioritise Customer Preferences, Not Your Own
Your startup is yours, but its purpose is to serve your customers. Vanity projects don’t last long. Every time you make a decision, keep the customers at the front of your mind. This will help you build something that they will be excited about.
7. Secure The Capital You Need
Your startup needs a certain amount of money to succeed. But having too much can make you complacent and lack the care required for financial decisions. Make budgets and ensure you have the right amount of capital at your disposal.
8. Create A Business Plan
Business plans can be tedious and challenging to create but they enable you to get funding. They can also help with your focus and keep you on target. Planning should be an ongoing process as you keep strategizing for the future no matter where you are. However, remember that planning must also make way for doing at some point in the process.
You can read our guide How To Write A Business Plan to learn more about what you need to include.
9. Futureproof Your Business
You can’t know for sure what is coming. But keeping informed and observing trends can help you make good predictions. This may give you a competitive edge, but you also need to be ready to adapt when the unexpected happens. It’s also wise to keep capital aside if you can in case you go through a rough patch.
10. Make Use of Technology
There are many powerful technological solutions out there to help with managing your operations. For example, ERP Software can help with many of the points on this list. It has tools for managing finances and predicting future trends. It can assist with making informed decisions and managing staff, customers and inventory. It could be an investment that yields great returns if used correctly.
Social media and other online resources can help you network with potential employees, clients, partners and promoters. You should also take advantage of offline opportunities like networking events and conferences to make new connections and find new opportunities.
12. Get Your Work-life Balance Right
It’s no secret that you have to work hard to succeed in the world of startups. You may have to fit your life around work a lot of the time, working more than the standard 40-hour week. Nevertheless, it’s crucial to find time to relax or you could end up burning out or damaging your home life or even your health.
13. Always Negotiate
Whenever you are quoted a price, remember there is often room for negotiation. You may be able to lower the profit margin for your own benefit. Discounts may not always be available, but it is always worth asking if there is room to bring a quote down. A good pitch can be a powerful way of convincing people that negotiating is worth their time. Don’t forget that as you grow and your buying power increases, you should be negotiating better deals.
14. Never Underestimate the Importance of Marketing
If people don’t know you exist, how can you expect positive results? No matter your budget, there are always things you can do. Even if it is as simple as maintaining a consistent social media presence or contacting blogs and podcasts, do whatever you can to market your business.
15. Surround Yourself With The Right People
Whether your startup employs people from day one, or you acquire employees as you grow, it is essential to hire the right people. Make sure they have the right skills that fit your business, and more importantly try and hire people who are passionate about what you do. People are always the most important asset in your business.
As your startup grows, you might find yourself at a point where you yourself are holding further growth back. This could be the time to step aside, take a different role in the business and employ an experienced CEO to take you to the next level. To understand when this might need to happen, you can read our guide When is it time to hire a CEO?
Founders that really want to succeed have to be able to move with the times. A healthy balance is important and having the right people around you makes a big difference. Even with the tips above, there is no guarantee of success. Understand that startup failure is very common and you should not see it as a complete failure if things don’t work out.
Try adopting the ideas and strategies in this article to increase your chances of success. And focus on your strengths whenever times get rough or uncertain. You have skills and personality traits that make you unique, and these are the best things for you to fall back on when things feel like they are getting out of control.