Many people over the past number of years have been asking me to share my experience of how they can start a successful small business. While no one is immune from the harsh reality of the real world I’ve found that successful startups, and indeed successful businesses have a number of things in common.
1. Always be qualifying
There are millions of problems out in the world today that affect individuals, businesses, nation states and humanity as a whole and all of them have different impact levels. Problems can be as simple as kettles that take too long to boil all the way through to massive Government departments that are struggling to cut billions from their annual budgets and trying to boost GDP. When you start your company you not only have to have a clear idea of what problem you are going to solve and the benefit you are going to bring but you also have to be realistic, and more importantly problems and their impacts change so you must be continually qualifying your understanding.
Drilling into the following questions, which are by no means a comprehensive list, by asking ‘Why, Why, Why, Why, Why?’ will help give you a strict reality check that will help you not only dig down into your proposition and uncover weaknesses but also help identify who your real target markets are and help you formulate the right fit go to market strategy.
- What problem does your solution solve?
- Is it really a problem for your target market?
- Is the problems impact significant enough for them to care about solving it?
- What is the impact and can you quantify it using your customer’s metrics?
- Do all of the stakeholders care about solving it, if so why?
- Can you quantify the value of your solution using the customer’s metrics?
- What’s your differentiator, can you quantify it, is it unique?
- How do your users want to buy and consume the product or service?
- What’s your channel strategy?
- What’s the market potential, how does it break down?
- Who are your competitors, have they been successful, why?
- What’s your risk exposure?
- Can you make money?
2. Sell to the right people
One of the most common mistakes I see startups make, particularly when selling to other businesses is engaging the wrong stakeholders. Understanding who your sales teams should be targeting is absolutely crucial, the people who are being impacted by the problem your solution addresses aren’t necessarily the same people who will authorise the purchase orders. Just because one group of stakeholders care about solving the problem others may not so be wary of falling into this trap which will not only cost you money but time as well. The longer it takes for your company to reach profitability the more of your funding capital you’re burning.
3. Keep it simple
The more complicated you make things the more energy and resources you’ll have to spend managing and explaining it. Use the back of a beer mat test – if you can’t fit your value proposition or strategy onto the back of a beer mat then you’re over complicating it. The longer and more complicated your pitch the faster your customers and investors will tune out.
4. Listen more than you talk
We have two ears and one mouth and using them in proportion isn’t a bad idea. To be a good leader you first have to be a great listener. Brilliant ideas can spring from the most unlikely places so you should always keep your eyes and ears open. This can mean following social feeds as closely as meeting notes or asking the front line staff and customers for their opinions as often, if not more often, than the executives. Get out there, listen to people, engage, draw people out and learn from them.
5. Create a proud company
Remember your staff are your best brand advocates. Helping and encouraging them to take pride and ownership will shine through in how they treat your customers and each other. A company that doesn’t consistently take pride in what it does will always fail because customers will eventually pick up on the negative vibes and the joy of dealing with your company will slowly vanish. Negative reputations have a nasty habit of spreading like wildfire in our hyper connected world.
6. Build a Culture
Employees work the most passionately when they want to work for you. Do this and they will go above and beyond to help customers and work longer and harder. If you push your employees into a corner, demotivate them and brow beat them into slavish submission then this culture will be reflected in their attitude to their colleagues and their customers. Build a great culture though and this will shine through and the net gain will be better customer satisfaction and greater employee and customer loyalty. It’s a triple win and as a startup you’ll need all the help you can get.
7. Don’t be the boss
Studies have shown that typically we can only manage and maintain a hundred relationships at a time and this is the tipping point for established companies because it’s the point at which the bosses start to lose touch with their employees and customers. When this happens the business becomes slower to react to new trends in the market place and misses issues that are affecting both your customers and staff. Ultimately this will erode customer and employee satisfaction and then translate into slower sales growth.
Far too many executives, in companies of all sizes, not just start ups spend too little, if any time in the thick of it talking to customers or employees trying to experience life through their lense. When was the last time you did a job swap with an employee or tried to see your business through the eyes of your customers and business partners? If the answer is never then you are not special or unique, you are the norm so get out there and do it now! I guarantee you will be surprised.
8. Never stay still
Even if your start up is successful time has shown us many times before that those companies that stay still and stop evolving, such as Intel, Kodak, HP and Research in Motion eventually see their revenues decline as new up starts come in and eat market share. You have to be constantly surveying your market, applying discipline, innovating and evolving. While staying fresh and relevant takes resources and effort it if managed correctly it will pay off in the long run.