4 Ways Startups Can Play Bigger Than They Are
Like people, great start-ups often grow from humble roots. When you’re just getting started and dollars are tight, you may need to play “bigger” than you are in order to be taken seriously and grow to the next level.
This doesn’t mean misrepresenting your business or making promises you can’t keep. It means accentuating early milestones, rather than the behind-the-scenes daily scramble required to make it all work. Here are four essential tips to put forward your company's best face.
1. Make your dollars count.
Think critically about what your business truly needs to move ahead and prioritize spending accordingly. In 2009, AirBnB was close to going under, with revenue stagnant at $200 a week. As the three cofounders maxed out their credit cards and struggled to find a plan, they realized that the quality of the listing photos was a determining factor in customer response. The trio immediately hopped on a flight to New York City and invested in beautiful listing photography, a non-scalable gamble that changed the course of their business.
What does your business need to break out? There are plenty of areas to pinch pennies -- office space, expensive marketing -- but don’t cut corners in the ways that are mission-critical to your company’s success. Playing big requires a great deal of spending discipline.
2. Who’s behind the curtain?
During the early days of launching Gilt.com, co-founders Alexandra Wilson and Alexis Maybank wore pretty much every hat imaginable. For CEO Maybank that included working shifts in the storage warehouse or personally handling customer service calls. It wasn't glamorous, but given the size of their team, it was necessary. Not to mention, customer service directly connected her to the experience of Gilt shoppers to learn what was and wasn’t working.
The lesson: Playing bigger in the early days often requires doing the work of many. Expect that you’ll be doing plenty of tasks that fall outside of your job description. It's all part of the process. Adora Cheung, co-founder and CEO of house-cleaning website Homejoy, took the site’s first cleaning jobs herself and for several years continued to work at least one cleaning job per month.
3. Define your purpose.
“Saying that the purpose of a company is to make money is like saying that your purpose in life is to breathe,” said Jim Barksdale when he was CEO of Netscape. While breathing is critical to life -- and making money is critical to a successful business -- you need more than that. Yahoo famously offered Mark Zuckerberg a billion dollars for Facebook while it was still an exclusive site that not everyone could join, but he passed. His mission to connect as many people as possible wasn’t complete. There’s a case where putting mission over money ended up being a highly lucrative decision.
For early startups, taking time to define the driving mission is important as it will enable you to recruit and inspire the best team and the right investors. In what small or big way will your business change the world? While it’s important to focus on revenue and other growth milestones, communicating your startup’s greater purpose will allow you to play bigger in early days.
4. Stay on track.
One of the most common mistakes made by startups? Chasing too many ideas without committing to a real strategy. “Founders of a young company will come up with hundreds of new ideas every day (I know because my co-founders and I do),” says Matt Salzberg, founder and CEO of Blue Apron. “While most of these ideas are sure to be good ones, we’ve learned that we need to be thoughtful and selective about which to move forward with in order not to overwhelm ourselves and our employees. We all have limited time and resources, which is why we need to focus and prioritize.”
While it's important to stay open-minded and be able to pivot, don't spend your time chasing every idea. It'll prevent any strategy from gaining adequate traction and hold your startup back from real success.
Betsy O'Reilly is CEO and a co-founder of QuadJobs. She had a 17-year career in banking where she was ultimately a managing director in charge of the global sales team at Deutsche Bank. She left banking and co-founded QuadJobs in 2013.