Coming off a multi-year run as the first employee at a startup provided a number of amazing experiences, lessons and growth opportunities. My career path has been one where I launched into the unknown of the media business at an early stage of my career, including a 13-year run at ESPN, where the excitement of sports and a big-time corporate environment proved to be great…and filled with lots and lots of learnings. As luck would have it, my path continued to another multinational corporation in Sony, before taking a role at a privately-owned agency immediately prior to making the move to startup life.
Starting a business is like trying to make a meal without a recipe – it's an adventure filled with surprises, and you’re never quite sure if adding an extra ingredient is genius or makes for a total disaster. With roughly 40% of startups achieving profitability status, there are numerous strategies that can help with the startup operation.
Believe it or not, startup owners who fail actually have a leg up on future success. Founders with no industry experience only have an 18% chance of startup success. So you’re telling me there’s a chance!
Here are a few things I have witnessed first-hand for those exploring launching your new business.
Understanding Your Market
Before you even think about launching, it’s crucial to understand your market. This doesn’t mean just knowing your customer's favorite color (though that might help if you’re selling pens). It's about comprehending their needs, their pain points, and what keeps them awake at 3am. Conducting thorough market research is like being a detective – except you're hunting for insights, not criminals. You cannot feel like this will help solve a problem, but rather know this will help solve a challenge in the market.
Tip: Do a dry run. Setup a basic storefront or platform to sell your product or offer to clients. See if they buy it. Better yet, see what they don’t like. You can cap the test at a few hundred or thousand prospective customers and cancel the orders once you obtain enough decision-making data. You can offer gift cards or credits on future orders. And you now have a potential customer base to start from. Validate your assumptions. Approx. 56% of startups fail because they are either not creating products or services that the market needs or they’re not implementing the right market strategies. Validate, validate, validate.
Financial Management
Financial management is not the most glamorous part of running a startup, but it's as essential as a steering wheel in a car. Mismanaging finances isn’t an option. Period. So, get comfortable with budgets, cash flows, and financial forecasts. And remember, hiring a good accountant is like finding a good mechanic or plumber. You’re hiring expertise. Use it.
Tip: There are numerous great follows on LinkedIn. Here’s a great EBITDA Cheat Sheet from Chris Donnelly to start.
Build a Strong Team
You might have the best business idea, but without a strong team, it's just an idea. Hiring the right people is key. But not too many people. Look for individuals who share your vision, bring diverse skills to the table, and, importantly, can function well in a startup or non-traditional environment. I’ve seen highly successful folks transition from corporate to startup roles only to find out that they excel in more structured environments. Again, don’t over hire. And look for potential teammates who can serve many functions as you develop your workflows and processes.
Tip: During the hiring process, both you and the candidate should explore the real day-to-day expectations of the role, working from home and interacting with teammates (either in-person or remotely). Diving into these types of communications will be key in identifying skillsets and personnel that can come together for a common cause.
Embrace Technology
Using technology in today's world is of paramount importance. From cloud-based services to social media marketing, technology offers numerous tools to streamline operations, reach customers, and scale your business. Don't be afraid to experiment with new tech; sometimes, pressing the wrong button leads to the best discoveries. This includes AI which is obviously the topic du jour among most companies. Using AI for productivity can take your output from good to great, and further establish your growing profile within your market segment.
Tip: While AI can feel like a daunting task to learn and implement for newbies, there are a ton of great (and free) resources to help get you started. Generative AI is another great follow on LinkedIn, and recently posted about free Google AI courses. There is no rush, so long as you’re willing to learn.
Customer Focus
Your customers are the stars of your business. Treating them right is not just good manners – it's good business. Make sure your product or service solves their problems or fulfills their needs (see above “validate” point!). Customer feedback is like gold dust; collect it, analyze it, and use it to improve. Remember, a happy customer is the best marketing tool you'll ever have. Creating and implementing an ongoing feedback loop from your customers will help you improve exponentially.
Tip: Take feedback to heart. Not with a grain of salt. Sure, there are obviously specific scenarios that can alter a customer experience that falls outside the norm when compared to your traditional customer engagement. But even those scenarios can provide insight into how/what/why a non-traditional customer experience can occur, and how you and your team can respond. Character is always a pop quiz.
Flexibility
In the startup world, change is the only constant. Being flexible and adaptable is like being a chameleon in a disco – you need to adjust quickly to survive. Don’t be too rigid with your plans. If something isn’t working, be ready to pivot. Just make sure you don't pivot so much that you end up spinning in circles. Identifying when to pivot is key. It isn’t always about the obvious profit metrics. Sometimes a single feature of your product or business will perform considerably better than the others around it. Lean into that performance. A subdued market response, viability of the business, and being outperformed by the competition also are examples of reasons to pivot.
Tip: There are numerous startup pivot resources out there. HubSpot is one of the leading CRM tools and publishes a meaty blog on numerous topics – including when, why and how to pivot a startup.
Networking
Last but not least, networking. Building a network of contacts takes time and effort, but is well worth it. Attend industry events, join online forums, and don’t be shy to reach out to people. Remember, in business, sometimes it's not what you know, but who you know and how you approach them.
Tip: Speak, don’t be a stooge. And don’t force your team to sell out. When engaging your network, have a conversation about your business in a way that doesn’t make them feel used or creepy. Talk with them about the value of the solution and why it makes sense. Read the room. If they’re not interested after a lengthy intro or convo, back off. These are people you know and respect, treat them as such and not as a transaction. Same for your team. Try to avoid asking them to drain their personal and professional network to the benefit of a company that may not exist in (12) months. No, that doesn’t mean they shouldn’t be selling at every turn, but there’s a proper balance. Don’t be tone deaf.
Launching and growing a successful startup is a journey filled with challenges, learning, and, yes, a bit of fun. By understanding your market, managing finances wisely, building a strong team, embracing technology, focusing on customers, staying flexible, and networking, you're setting the stage for a thriving business.
Just remember, there’s no one-size-fits-all recipe for success. Above all else, trust yourself. Sometimes the best moments are the ones when you know that you don’t know something. Rather than act, learn. Make sure you understand the topic at hand, then act on it. And change course when you realize you should. Startups that pivot 1-2 times have almost 4x better user growth when compared to startups that either don’t pivot or find themselves “over pivoting” (more than twice).
Practice doesn’t make perfect. But it sure helps.
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