It’s no secret, a high percentage of startups don’t make it. So what steps can you take now to increase your chances of success? Ensuring success for your startup means utilizing every bit of your time and budget. We’ve put together a list of 8 tips below to help you increase your startup’s chance of success. The following ideas are not revolutionary, but implementing them can help you build a strong foundation for you as you grow.
1. Hire Great Developers
If you don’t have the skills to code, make sure you find someone with the right skills and experience for your startup. It takes much more than a solid programming background to be able to effectively implement your idea. For starters, make sure a prospective coder has built previous websites with features similar to your own vision. Your limited time and resources are far too valuable to invest in someone without a proven track record.
Failure to hire the right coders can result in a myriad of problems. An inefficient coder will take a long time to launch the site, wasting time by making minor changes and fixing bugs. They may not cause much harm on a daily basis, but too many of these minor setbacks can result in a missed opportunity to capitalize on first-to-market advantages.
2. Launch Your Site Quickly
You’ll likely always encounter last-minute opportunities to add features to your product—however more often than not these changes will delay your launch date. You might even consider the changes worth the wait, especially if the added features have the possibility of further engaging your customers. However, make sure to launch as soon as possible once your product has critical functionality. Launching an MVP (Minimally Viable Product) is important in gaining a first-mover advantage. You can always make changes later to improve your site and product, and allow for them to be based on real customer feedback. If you’re insecure about a hasty launch, let customers know they’re viewing the beta version of the site, and they can expect improvements soon.
3. Interview Your Users
If you’re developing a product, make sure you truly understand the needs of your end users. You might assume that potential customers are seeking your particular solution, only to discover after launch that your product might be too expensive or doesn’t precisely repair the problem. Make sure you take the time to understand and interview your end users to better understand what your users need, and how much they are willing to pay for it. If you’re having difficulty determining the wants and needs of your users, a beta version presents a prime opportunity to introduce your product and gather information from users.
4. Don’t Target a Small Niche Market
Solving a problem for a targeted niche is not a bad idea — the smaller the niche, the less competition you may face as well as the easier it may be to target and acquire your customers. The downside, however, is the possibility of not gaining enough users to make a profit. Performing market research in order to better understand the scale of customer interested in your product is a savvy first step. Once you have established a foothold in a niche market you can plan to expand your offering to service the same need in adjacent markets. When you evolve your original idea into adjacent markets, you will increase the probability of exponential growth.
5. Make Sure You Raise Enough Money…The First Time
Determining how much money to raise is a tricky balance between raising enough to accomplish important milestones while retaining ownership of your company. Raising enough money in your seed round to carry your business through inevitable growing pains and redesigns is important, but retaining enough money to develop the final product your users will love is essential.
After your initial raise, you don’t want to spend all your time convincing investors to sign another check to keep the company afloat. Investors would rather you spend it further developing the business and getting them a timely return on investment. As a general guideline, you want to raise enough money initially so that you can hit a major milestone and have something to show investors.
6. Be Smart with Your Money
Using seed money efficiently can help you hit those milestones necessary to receive further support from your investors. By outsourcing a variety of activities, startups are now becoming less expensive to launch. However, startups continue to waste money every day, overspending on things that can wait until later and paying for tools that don’t get them the expected results.
One of the most common unnecessary expenses of startups is hiring too many employees too fast. Employee salaries contribute to high overhead expenses, and should be carefully controlled at the beginning of a successful startup. The only hires early on should add required functionality that cannot be fulfilled by current staff. Be sure you can fill up the entire day of each indispensable full-time employee before you make the decision to hire. If you cannot afford the overhead expense of additional full-time employees, outsourcing by hiring short-term or part-time employees may be your best option.
7. Multiple Co-Founders
Every worthwhile startup is time-consuming. Although you may be the one to envision its concept, you may lack the required skills to launch your idea into reality. Dividing the work among trusted partners with necessary skills sets will allow you to bounce ideas off each other freely and accomplish much more than you could by yourself.
Dave McClure states that the ideal startup has a hacker, a hustler and a designer. The hacker to code, the hustler to bring in the business, and the designer to architect the concept and make sure it is appealing to consumers or investors. Even if you are capable of wearing every hat, there is not enough time in the day for you to wear them all at once and get your company off the ground in a timely manner. If you can’t convince a co-founder to come on board and get behind your idea and fill one of these roles, it may be a red flag that your idea needs tweaking.
8. All Or Nothing
When building a startup you need to focus all your time on your company if you want it to survive and succeed. In every case, this means quitting your day job.
If you’re trying to build a product, target customers, and attract investors all in your spare time, why you still have a day job–you don’t have your priorities lined up. Investor are unlikely to get behind you in this scenario because you aren’t “All in” yourself. When your livelihood depends on your startup, you’ll not only have more time to dedicate to it, but you’ll also have the drive necessary to successfully get it to market.
This list of tips doesn’t by any means guarantee the success of your company, but it will give you some benchmarks to compare yourself against and help you operate more effectively.