The 3 Most Overlooked Ingredients of Startup Success Are All in Your Head Hard work and a good idea are necessary but not sufficient to succeed the harsh winnowing process that crushes the majority of new businesses.
By Pratik Dholakiya Edited by Dan Bova
Opinions expressed by Entrepreneur contributors are their own.
If you've been going through all the news stories of venture capitalists ploughing money into startups, you will be forgiven for thinking all startups are minting money. Unfortunately, that's not the case; the "dirty secret" of the world of startups is that 3 out of 4 startups fail.
Yes, that's right! The startup failure rate is high, but you can still realize your dream of starting your own business. Success and failure are a part of the game. Your job is to play the game fair and square, which includes the right mix of ingredients to increase your chances of success.
Here are three often-ignored ingredients that have a huge role to play in ensuring startup success:
1. Strategic thinking.
One big myth doing the rounds of startup corridors is that instinctive decisions ensure better results. This myth suggests startups have to think on their feet and don't have the luxury of looking at a problem holistically, working out the pros and cons of a particular plan of action and then making a decision.
Wrong.
It is of mission-critical importance that startups think strategically and not instinctively. The "gut feeling" is part of the larger decision-making process, but mustn't play a central role. Backing a decision with relevant data is far better than using intuition. Your startup has very little leeway to make mistakes. If you are in the habit of "going by your gut feel," you are essentially throwing open the doors for wrong turns.
Successful startups are in the habit of thinking strategically and planning their moves well in advance. For this to happen, they access customer data and key market intelligence to make the decisions that make them hot property for venture capitalists.
Related: Why Entrepreneurs Should Stop Celebrating the 60-Hour Workweek
2. Celebrate failure.
Most startups, at every stage of their lifecycle, experience failure of some sort or the other. Some make mistakes during product development, while others can't seem to get their marketing strategies right. Treat these failures as a form of learning and plod on.
The old adage, "A mistake is not a failure if you fix it, learn from it and move on" is relevant for startups. If you've made a particular mistake once in the startup's journey, it shouldn't be made again. It should serve as a warning, helping you avoid pitfalls that you otherwise would have fallen prey to.
So, don't fear failure. What you must fear is not learning from failure and allowing it to bring you down. If you get bogged down by failure and don't look at the positive side, there is a very real danger that you won't be able to think long-term. Your startup will suffer from stunted vision that will adversely affect its prospects.
Related: Afraid of Failure? Think Like a Scientist and Get Over It.
3. Think differently.
The truly great companies think differently. That's why they are able to do well, irrespective of whether the economy is slowing down or is on an upswing. This difference in thinking is a result of a positive attitude and a deep confidence in their products and services.
The ability to think differently ensures they don't subscribe to "sheep mentality." They do what they think is right for their business and are willing to take calculated risks. Startups that have come up with innovative products and services, and imaginative ways of marketing them, have more chances of survival in a highly competitive niche.
Thinking differently is about being innovative and smarter decision making. Thinking differently might not come naturally to some people. In those cases, it's a skill that needs to be learned.
What's more, even if thinking differently comes easily to you, it might not come naturally to you in some situations. The latter will be a real test of your ability to think out of the box, swim against the tide and ensure that the decision you are taking is the right one.
Related: How to Think Differently to Succeed in a Complex World
