50% of startups fail. This is not meant to be a scare tactic. It is simply the truth about catapulting yourself into the world of entrepreneurship. And it also means that 50% of startups succeed. As a serial entrepreneur, I have had my share of successes and have had even more failures. When considering my own experiences as well as those of some experts, such as Seth Godin and Neil Patel, (they are both bald, but I don’t think that is a success factor) I have drawn the following conclusions about how to beat the odds.
1. The Product is Timely
Successful startups produce a great product, that solve a problem for people AT THE RIGHT TIME. Introducing a product to market at the perfect time is part strategy and part luck.
In 1997, my boss had a Palm Pilot, which was considered one of the first digital assistants. It had capabilities for scheduling, organizing contacts, and it allowed data to be synced from one device to another (think Dropbox). The Palm Pilot offered all of the right things, but was ahead of its time. One of the best ways to test product timeliness is to select a test group and get market feedback. No matter how great you think your product is, if your target market simply isn’t ready for it, your startup will fail.
2. The Ts Are Crossed
The product is exciting, the process is thrilling, the prospects of success are exhilarating. But, creating a business the right way can be boring. My colleague, Scott, has talked about building businesses like the Steelers and there is a lot of merit to taking the time to build a foundation that will sustain a long term business. Cross all of the Ts, even when it isn’t fun.
Taking the time to hammer out the business process, business model, long term funding, and issues of scalability is how successful startups work ON their business, not IN their business.
3. A Company That Isn’t Growing, Will Shrink
There will never be a bigger indicator of a successful startup than growth. Rapid growth indicates that there is a hot market and that the product is relevant. When startups fail to grow with double digit growth rates, securing funding is difficult and the competition has a chance to catch up.
Many startups have mixed feelings about growth. Of course they want to grow, but are scared to grow too fast. But, please see #2. If you have laid a solid foundation, your startup will be able to figure out how to accommodate the growth.
4. The Team is Pilates Flexible
When I see people doing advanced pilates, I witness a whole other level of flexibility. This is not “touch your toes” flexible. This is “next level” flexible. And that is what your startup team needs to have. Changing products, adjusting target audiences, and creating new marketing plans are just a few of the challenges that will pop up in a new startup. Teams that can work together in flexible harmony will position your startup to beat the odds.
Go forth, brave souls, into the world of the startup. Half of you will prevail. And to the other half, try again!
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