The Keys to Surviving As A Startup
Did you know that an enormous 90% of startups do not survive?
We are living in a day and age where startups must have a comprehensive strategy which is going to support rapid sustainable growth. For many industries, the market is already a crowded space. If your startup doesn’t offer something new there is a very slim chance of survival.
Don’t be put off by these statistics, whilst others fail we can learn from these mistakes to adapt our strategy for the best chance of survival. You don’t need to be an experienced entrepreneur to have a successful startup (although it helps). You can always use others’ mistakes to guide your startup on the road to success.
Meeting the needs of your market
Don’t go looking to develop a new product or service that nobody needs.
You need to solve an existing problem first. One of the most expensive times in any startup’s life is product development. But, if the product you develop doesn’t help solve a problem that people actually face, it won’t sell. This is an essential concept for any startup developing a new product but in some cases, it can be overlooked.
There is no point spending thousands of pounds developing the perfect product, crafted out of quality materials if nobody needs or wants it. Spend this time researching a problem you wish to solve. Look at trends and what people are talking about. Next, test a prototype with someone who is currently facing the problem. This will give you a full understanding of whether your product or service actually meets the needs of the consumer.
Competition within the market
Never underestimate the power of market research. A part of any startup’s research should be investigating how large the market opportunity is and what are the names of the big players within this market. Once you have designed the perfect product or service, you need to know how you’re going to introduce it to the market and how you’re going to compete with these much larger players. What is your USP? Why choose your product or service over theirs?
The release of your product needs to make a noise. We’re not just here to fit in. Disruptive marketing is key for making an entrance. You need to catch the attention of potential customers. Offer new technology or a new process which addresses a problem that people actually face on a day to day basis. Once you understand your market and what your main competitors are doing, you can utilise this information to reach new segments of the market, generating sales from untapped marketing channels.
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Plan your business model
Would you start building your new house without a plan, without the framework to hold everything together? Of course not! So, why would it be any different with a startup? Spend time establishing a business model that will act as the structure for how the business will operate.
Understanding how the business model will work within the desired market is crucial. For some added reassurance you should test this business model and search to see if any other companies are operating with this same model in similar industries. For example, a subscription business model works to great effect; it offers a consistent flow of income to the business which can be reinvested in acquiring new customers. Discuss your business model with fellow business owners or experts within your industry. They’ll be able to offer invaluable advice.
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Think scalability
If you are creating a startup with the ambition to completely dominate a certain market, you need to think about how scalable the business is. There is a wide range of factors that tie into scalability. Here are a couple of questions you need to ask yourself:
– Can you escalate production to thousands of units per day?
– Does your business model allow for rapid expansion?
– Has the product been tested in the market with positive feedback?
– What losses are involved with the development stage of the product?
These are all factors that startups should consider before releasing their product or service into the market. This is also something that potential investors will evaluate your business against. Although you may believe that your product is ready to take to market, you need to ensure that the business is scalable. Don’t let a step skipped in the planning stage come back to hinder your business’ growth.
Plan for success
A recurrence between all of the key steps to help your startup survive is that they all lie within the planning stage. To rush these steps you are setting yourself up for failure. There are going to be mistakes along the way, that’s just a part of business. But, with a comprehensive plan there is nothing stopping you from being part of the 10% of startups that survive.
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