Watch before you cross: A Word of Wisdom for Startup Entrepreneurs
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India is evolving into one of the most dynamic entrepreneurial ecosystems globally. While there’s no dearth of talent and ideas, it begs the question—are these enough to ensure the success of a startup? The answer is, most probably not.
There are numerous factors that can make or break a startup. Is the market ready for the idea? Is the product or service a true solution provider? Is the right team in place for the mission? Does the business model align with the funding channels? Is there a contingency plan in case things do not work out as expected? What are the various marketing initiatives required to reach the desired stakeholders? These are just some of the pressing questions that need to be addressed before embarking on rolling out the idea.
While startup success stories are celebrated and receive much limelight, what these discourses often miss is the gritty journey that every founder has to go through. As the ecosystem improves globally, with more incubators, access to capital, mentoring community and a supportive framework for startups, there are ways to mitigate risk. Nonetheless, risks are aplenty and it’s only foolhardy for an entrepreneur to remain blind to these.
Here is a list of things, every startup founder needs to consider before taking the plunge:
An Idea sounds cool, but people pay those who make problems go away
Every founder looking to start a startup seeks an Idea; the idea is a solution to a problem. Fixate on the problem. The solution that you offer may or may not work due to a large number of reasons including value perception, society, consistency, etc. It is important to keep the eye on the problem and look for newer ways to solve it. Not all ideas will work, find one that does. In the end, people pay when they perceive value.
Your early customers will make you or break you
Once you have figured out a solution that people see as valuable enough, you have to build an enthusiastic base of early customers who love your product. This becomes a lot easier if you are focused on a niche segment. These customers provide you with early feedback and help you fine-tune your product/service. If they love what you are doing enough, they will be your ambassadors and spread the word about you.
Creating buzz to increase visibility
At this point, you’ve barely scratched the tip of the iceberg. Before one even rolls out the solution, a proper phased market research of customer expectations can go a long way in fine tune the product.
This isn’t just a question of who are the interested consumers, but how many? Once you’ve done a stringent assessment of your niche, its size, the challenges that could be faced, you can then start pushing for growth within the segment.
The best money is the customer’s money. So long as you are able to deliver upon what you promise, you would not be required to return the same. It is important to find ways to monetize what you are doing and to drive cash flows towards your business as early as possible.
Plan a runway for the first 12 months and line up the money that you need from friends and family. Once you start generating cash flows you will see that this money can last you longer. Once you find the model that can generate money, in order to drive explosive growth, raise funding from angel investors or VCs.
Every business is founded on strong insights and you need to keep honing them since the context, as well as the market, keeps changing. It is important to stay on top of the trends that are afoot and also understand the impact of the same. Think about what those changes mean to you. This time spent will help you steer your business in the right direction. The thought is the seed of every action and you need to keep developing it.