Most startups fail; that is a fact. Research indicates that 75% of venture-backed startups fail. On the other hand, 90% of all startups fail. That means, given ten startups, nine will fail.
Dire statistics for sure. However, the stats also raise a question, what is it that 10% of startups that succeed, do? What are the characteristics inherent in the startups that thrive?
1. For a startup to succeed, the service or product must be perfect for the market
Finding the right product at the right time is key if one is to succeed. The moment you lock on to a product or service that will have mass appeal, the rest is history.
Unfortunately, in the name of innovation, most founders and co-founders forget this.Steve Jobs once said that often, people do not know what they want until you show them.That is true to a certain extent. Take mobile phones, for instance. It took them a long while to catch on and yet the industry is now worth $355 billion.
However, it is essential for entrepreneurs to realize that one must balance innovation with a careful market analysis if they are to set themselves up for success.
2. Setting up yourself for success involves monitoring all aspects of your business
Do you remember Dijiwan? The startup had a great idea,andstill, they faltered. Afterward, Dijiwan’s leaders had this to say—a good idea and a fabulous team do not guarantee a sustainable business. Taking all aspects of business into account is essential.
What does this mean? Essentially, it means that the startup founders cannot ignore the stuff they consider boring such as marketing, business model, scalability and business processes. Note that a CEO cannot say his/her job is leading, a CMO market and a developer coding.
No. All these people must work together for the collective good of the company. In all truth, most of these functions overlap. Therefore, work on your business. Do not be an employee in your business with no idea what the rest of the business does.
3. To succeed, learn from your mistakes and find ways of recovering
Richard Branson once said that one does not learn to walk by following rules, they do so by doing and by falling over.
Similarly, when it comes to startups, there is no set of rules that will guarantee success. At some point, you will fall. What will differentiate you from another is how you recover from the fall.
If you learn from the mistakes, then chances are high you build an even stronger business,and in the future, you will avoid the pitfalls that led to the first mistake.
4. Security plays an essential role in the success of your startup
Sometimes, founders get caught up in the excitement of setting up a startup and forget security. In particular, cybersecurity.
Take the example of Code Spaces. It was a very small startup with just five employees that provided software as a service. They hosted a browser-based development IDE (think Eclipse) and a code repository (think GitHub) for their customers.
Unfortunately, they had to close down after a security incident simply because they did not secure their resources on the cloud.
Therefore, invest in tools that will help that will help secure your startup’s digital life. A VPN for instance, it provides military-grade encryption that no one is yet to crack. A little protection goes a long way when it comes to fighting traffic interception and tracking. Mind you, the top options will likely cost more than a few dollars per month. While that’s not a whole lot considering its benefits, there are ways you can get it cheaper. Instead of looking for free or cheaper options, look for VPN deals from your favorite brands to enjoy the best of both worlds.
Moreover, ensure you have a strong firewall, not to mention, password best practices. In essence, do everything you can to ensure that it is not cybersecurity that will bring you down.
5. Succeeding involves implementing “lean startup” practices
Last but not least, implement “lean startup” practices. That is an industry term that means you raise just enough money in one funding round to hit the next milestones.
Doing so will motivate you to keep working at it because the only chance you have of getting more money is proving to your investors you are hitting all the important milestones. Therefore, go step by step and chances are high you will be keener which will translate into higher chances of success.