Launching a startup is a dream come true for those entrepreneurs who want to make their name on the digital frontier. However, many find the journey to be an arduous affair filled with lingo and legalese that only serves to destroy young businesses.
Navigating the startup world requires more than just risk assessment and popularity. Startups need leaders to help the founders along and make the company legitimate. Good leaders with great experience make successful companies.
A mistake that startup owners often do is to assume that their products or services will be bought by a lot of people. But it’s recommended to research and find out if there is a market for what you plan to sell. You can do that by asking potential customers if your product or service is something they would need and be interested in buying. There are a few other things, however, that a startup owner can do to have a successful launch:
1. Assess your risk
Over 90 percent of businesses fail within their first five years. This statistic is truly staggering for a number of reasons. Aside from that, a startup owner should ask himself how far out of his comfort zone he plans to stretch and how many hours he wants to work on a weekly or monthly basis. Firstly, many entrepreneurs downplay the risks, seeking quick rewards. However, the best strategy, especially for a young company is to take a hard look at the harsh realities of their industry, competition, and opportunities. There are several methods to help:
- SWOT analysis stands for Strengths, Weaknesses, Opportunities, and Threats
- NOISE analysis stands for Needs, Opportunities, Improvements, Strengths, and Exceptions
- SCORE analysis stands for Strengths, Challenges, Options, Responses, and Effectiveness
Here are 4 types of key risks that if identified right from the start, your startup will have increased chances for success:
Service or product risk means determining what you are selling and what problem your product or service solves. If you don’t know or can’t explain that very well, then nobody else will pay attention to it.
Financial and market risks - it’s important to identify the moments in time when investments are necessary in order to reach a milestone. You can find investment opportunities with the help of crowdfunding tools, traditional VCs or angel investors. Market risk is also crucial: knowing your customers, the reasons they buy from you, when, where and how can also help your business succeed.
Employees risk - hiring the right people that are ready for each challenge along the way is great. Allow your team to make the decisions they consider best and to come up with new ideas to market and maintain successful business growth.
Business execution risk - micro-managing can lead to losing sight of the company’s strategy. However, alternatively, crucial details are often overlooked and can also create huge problems. The most useful approach is to keep a focus on the general business execution and at the same time assess the details, which is especially important in the early stages of a startup.
2. Make a marketing plan
It may sound like a simple proposition, but making a marketing plan is skipped all too often in the startup world. A marketing plan will give the startup a distinct identity and provide a good base for attracting customers. If you don’t want to find investors for your startup, you still need a marketing plan, which will be a roadmap for how and when you will achieve your business goals. Although the plan can be changed as you progress and measure results, it will still help you stay focused on what is most important. Here are the steps you need to take to jumpstart your marketing plan:
- Identify your customers
- Track customer journey
- Make sure you stand out from the competition
- Identify the most profitable marketing channels for your business
- Measure the progress of your plan for 6 months; based on that, you’ll be able to make new decisions for your startup
Startups with solid marketing plans are giving themselves the best chance to succeed. Marketing is one expense that always pays back and is essential for young businesses without established products or services.
3. Hire experienced leadership
Startups often lack experienced leadership. Many young companies and solopreneurs don’t think they can afford to bring on managers and executives with decades of experience. However, this is not the case.
For example, if you’re wondering how to hire a web designer who is very experienced without spending too much money, you can do that very easily by collaborating with a freelancer or a consultant at affordable rates. As a web designer wears many hats and encompasses various skills and professions, a hiring guide can help you understand several broader terms and know what questions to ask during the interview, so you can find the most suitable design professional for your company and for the role you plan to fill.
The same thing applies to market research, product planning, and product launch that can be overseen by a remote product manager with years of relevant experience, which can drastically lower risk.
4. Seek out mentors
Mentors are veterans of the industry that can provide young businesses with the tools and tips of the trade. Their insights are invaluable to startup owners as they begin their journey on a confusing path. But how do startup owners find mentors? They can do that with the help of:
- Startup incubators
- Social media such as LinkedIn or Twitter
- Industry expos
- Colleagues, friends, and family
- Professional associations
- Experienced founder/CEO
- Networking events
Mentors can be the linchpins that keep the entire company together as it goes through its initial steps. They also provide wisdom and level-headed advice to assuage young leaders.
Entrepreneurs need someone who is experienced, confidential and at the same time non-judgmental. Mentors can help in multiple ways: from how to raise finance to brand building and customer service. They challenge, but they also give confidence and a better focus when needed.
5. Listen to your customers
Staying in a bubble won’t help you release a product. It certainly won’t help you sell a product, either. You need to be constantly and consistently attuned to your target market. When customers don’t feel listened to and valued, they will quickly look to competitors, if they will provide a better customer experience. Studies show that 86% of clients would pay more for a new provider that offers an improved customer experience. The most important business decisions are based on data from customers as they are the best critics and testers. If you don’t know what your customers want, what they can afford, and the brands and products they are already interested in, you won’t be able to effectively develop and market your product or service.
First and foremost, startups should assess their risks immediately. It is vitally important that startups understand their weaknesses and identify potential issues with their products in honest and open ways.
Making a detailed marketing plan is a great way to establish the startup as an entity and will bring some amount of recognition to the product and/or service. This can also provide stability to the company and operations.
Mentors can give advice from an outside perspective. They are typically veterans of the industry that can give startups the inside scoop on what to expect and where to go next. Inside knowledge like this gives the startup an incredible advantage.
Finally, and most importantly, startup owners must listen to their consumers and focus on building relationships instead of attracting high turnover customers. Cementing the startup in a community of fans will bring stability to the business and create lasting customers. Additionally, always learning and trying new things is useful, so don’t fall into the trap of “this is how I’ve always done business” pattern.