3 Things That Can Prevent a Startup From Failure

Photo by Jehyun Sung on Unsplash

More than 30.2 million people in the U.S. own their small business.

The year 2019 will bring more opportunities for startup businesses thanks to the growing economy of the United States.

There isn’t too much inflation this year too, money is still flowing and startups can expect larger deals in the near future.

Entrepreneurs are under the impression that they have the best idea for their business. However, there’s still a huge gap between a great business idea and executing on it successfully.

For success in any business, it’s not always about having enough funds and smart personnel. These days, successful business means having the list of ideas that’ll make you money in the market.

2019 is the best year to invest in your ideas but startups will have to fight harder for it. Out of all businesses established in the year 2014, only 56% of startups lived up to their fifth year, and the remaining 44% failed! Some failed because of poor marketing, some ran out of cash, and some don’t have that one great idea to execute.

The failure rate of new businesses is downright demoralizing, so what can you do to increase your chances of staying up in the market?

Acquiring diverse resources, and knowing how to use them

For startups, hiring a diverse team of people with different skill sets can be a big contributor to their success. It is because having a variety of backgrounds on your team can ensure you’re walking on the path of success. Domain acumen like learning new things about your business, financial terms, team management, marketing, payroll, and corporate taxes are also essential for a successful business.

However, that’s not all your business needs to be successful and to make money in the market. There are other things you need to pay attention to before you launch your startup.

For instance, having deep knowledge of your market, product, and service are also needed to become an expert in the market. You also need to work on how’s your market doing, who’s your competitor, and what they are doing.

According to Rob Kalin, Co-Founder of Etsy (an E-commerce Startup) -“The Last 10% It Takes To Launch Something Takes As Much Energy As the First 90%”

A Strong Vision

When launching your business, things may get tough. A vision is also vital for boosting your chances of success. Your vision help creates a new culture but it’s not only about where your company seeks to be in coming years. Rather, your company’s vision should be about creating your own world in your business niche that too as a result of your company’s services.

Business management has a lot to do with your company’s vision and the first question for a leader always is ‘Who do you intend to be in coming years?’ Not ‘What are you going to do in the coming years?’

Examples of a good Vision Statement of successful Startup Companies:

InvisionApp — Digital Product Design Platform

Unlike other b2b websites, Invisionapp has the best website pages. They’re best in terms of defining overall company vision and mission under each of their website icons that is “Good Design is Good for your Business.” Scroll down your mouse to read all their statements laid out under each icon of their website, which makes Invisionapp look more trustworthy to customers.

IKEA— World’s Largest Furniture Online Retailer

The team at IKEA set their vision and mission statement based on the customers relevance instead of creating tag lines related to their beautiful and affordable furniture. The team made a statement too, “Our business idea motivates us to set this vision — IKEA to make everyday life better for its customers.” Adding words like “adding as many as customers” and “making everyday life better for customers” are more appealing to customers.

So, always think of your company’s vision first and try to make it as per your business goals, not your products or services. Simply, chase the vision, not the market, money or your business rivals.

With so many business ideas to choose from, it’s sometimes hard to figure out which are worth pursuing. The next idea is not only profitable for startups but also great for them in the long run. 

Gathering Data, More Data, and using it

To earn funding for your startup or any other type of investment, you have to gather data from the market to see how much scope is there for your offering. As well as how much people would want to invest in your idea. How long do they need your service? And, what data you require to build up your market reputation?

To solve this part, I suggest you simply have your “investor’s assessment form” with the option of tabs — “necessary service for your business” and “what’s new for your business.”

Surveys, market studies, market stats, investment value metrics, online marketing analytics, in-store traffic monitoring are all good ways to gather data for your startup.

If possible try to get some advice or data from personal conversations with your colleagues, coworkers, and people around you who’ve already worked on the same concept you’re working on. This also yields great information and help you turn your business ideas into reality.

Let’s understand with an example:

Imagine you have an online retail shop and you want to track your purchase data for your goods and services. You need to analyze points such as — How much your customers have purchased? What they’ve purchased? When they have made their purchase of goods? What mode they’ve used for their purchase?

As you know you can’t handle all this manually. You need to deploy the right POS software or big data SaaS platforms on your website that will be able to automatically track and store all of the information in a CRM (Customer Relationship Management) software or Cloud storage.

Also, it would be wise for startups to install plugins and programs on their website to collect and store data in a safe place for further analysis.

Your Move

As one begins to work on these strategies, it’s also important for startups to work on the market stats. It is because the more you know your customers, your reach will be more effective. And, when your customers feel like you’re fulfilling their needs and wants, they’ll respond accordingly and you’ll see a massive increase in your market value, market size, and stats.

In conclusion, there are many ways that startups of all sizes can achieve success. Investing in the right strategy, the right vision, and the right market is important for your business. Learning about the market, and giving your best can only work for a startup idea.

These tips come from my own experiences in trying to build a startup. I list more such experiences and stories revolving around lives in my Lifestyle/Education blog.

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