Avoiding the Mistakes that lead to a Startup Failure

July 9, 2019 in Startups

It is not easy to make a successful startup because almost half of the founders do not do what is essential for this achievement—addressing a problem that is troubling the customers. If you have a business idea and you spend your time and money building a venture around it, you may or may not succeed because the question lies in the application of the idea. If it does nothing apart from selling goods, it is bound to fail.

So, what you need to do to make sure that you don’t fail:

  1. Find out a problem that is still unsolved—try providing a solution to this problem. It could be a product or a service.
  2. Try figuring out your customer-base—the more specific and focused you can be the better it would be. Starting from a small customer-base is not bad.
  3. Talk to people—get feedback and suggestions from real life scenarios. Don’t simply depend on online surveys and simulations.
  4. Talk to your customers—ask them what they want. Tweak your product or service based on the feedback. Don’t sell your product or service and ask the customers for its adoption.

The market is full of startups but a lot of them fail because there is no market demand for the products or services that they offer. It is like setting up a push-cart business of vegetables in a vegetable market—the probability of success is bleak. However, if you could sell these vegetables in housing communities, remote housing areas, you have every chance of succeeding.

You have to innovate on your idea if it revolves around a traditional business model. However, if you are bringing something very unique and previously unheard to the market, you need to make sure it addresses a problem and not simply a fancy way of doing things. The initial success (which you may have) will die down soon.

Step By Step Guidelines On Fundraising

May 15, 2018 in Startups

Planning is the key to success in every mission. This is very much true when it comes to fundraising. When you adopt a planned approach, you will find yourself more organized and achieve more than what is otherwise possible. It is important that you avoid the common mistakes done by many people seeking to raise venture capital. Here is a step by step guidelines on how to move forward with your fund raising campaign.

Step By Step Guidelines On Fundraising

Prepare a list

Creating a list of prospects is the first step to any fundraising campaign. Most VCs either do not do this or do it wrongly. It is most unlikely that you will approach only a limited number of people and be going about the task without a list in hand would be a mere waste of time.

Reorganize the list on a priority basis

When you rework on the list you have prepared, you will feel like moving the entries up or down depending on the priority you attach to the potential investor. Though the list can grow up indefinitely, it is good to have it as small as 15 organized based on priority and proceed with the list.

Sort out the investors

The next step is to sort out the potential firms into different segments to know who will be a good fit for you. Target the investors who might be willing to invest the amount you have in mind, not more or less. Do not target funds that are of higher value. Also focus on the industry of the investor, the geography and competitiveness before studying their past history of investments. This idea must give you a set of criteria to work with while sorting out the firms.

The underline

Always do remember that fund raising is like selling something. The investor is a kind of customer with funds at their disposal. Though they have money to spend, they can invest only in a handful of companies. It is hence essential for you to develop the approaches and strategies that will help win their trust. When the investors feel you are a smart and credible individual who can lead effectively and inspire others, they are most likely to take interest in investing in your venture.

Top Reasons Why Some Entrepreneurs Fail

May 7, 2018 in Startups

Looking at some top stories in which some entrepreneurs failed in their ventures, we understand that ideas alone do not pave a way to success. The people who implement the ideas are more important than just the good ideas. Hence we must say that execution is everything when it comes to success in entrepreneurship. In other words, failure is related to the flaws in execution. No one can start with the perfect idea. Nevertheless, success comes at the end following a long line of learning experiences, adjustments, good habits and collective efforts.

Top Reasons Why Some Entrepreneurs Fail

Top reasons for entrepreneurs to fail

Inability to understand what ‘hard work’ actually means

In entrepreneurship, we need to work with uncertainties. There is none in the world to give us a predefined set of syllabus or assignments to go about. You must be able to decide what and how you must do. Most entrepreneurs struggle with defining their measures and the shock of getting to know how much hard work these measures demand from them.

Not able to balance between patience and impatience
This is a very important quality that most entrepreneurs lack. You must know where to be patient and where not to be impatient. It is like showing the willingness to walk down the long road while being vigilantly ready to gallop when situations and luck permit.

Never identifying what they are good at
It is said, “Imitation is Human”. Most entrepreneurs go by what is popular than trying to unravel what they are good at. If you have to pursue something that does not come to you naturally, you will be naturally slowed down. Also, you fail to put your abilities and talents to good use.

Thinking of entrepreneurship as a solo sport
Some unsuccessful entrepreneurs are found unwilling to share their equity, workload or their network with others. Success in entrepreneurship does not come because of one person. You must find the right people and deliberate the tasks to them to stay more productive and successful in the long run.

Unwillingness to know what they do not know
It is natural that we do not know everything in life. However, willingness to know what we do not know but necessary to push our way forward is an essential quality that will make up successful entrepreneurs.

Understanding Start-up funding Options: Seed Vs. Series A

April 19, 2018 in Startups

When it comes to venture to fundraise, start-ups confront two major options namely seed round and series A. Choosing the right one for your situation can be a tricky job. However, understanding them rightly will help you decide the best stand that will benefit you both in the short as well as long run.

What are they?

Seed round refers to a series of related investments by 15 or lesser number of investors who will ‘seed’ a new firm with an upper cap of $2 million and the money is used to fund the market studies and product development in the early stage. The investors benefit from equity, stock option or convertible notes.

Series A refers to an investment with an upper cap of $10 millions by a smaller number of angel investors who benefit through series A preferred shares.

Get to know seed round

Seed round funding solely pertains to the start-up stage and the investment helps build the foundation for the business to establish itself and move towards sustainability. In this stage, the founder is just experimenting with the business and it is not necessary for them to know everything. Hence the most important thing is to have experienced investors who can troubleshoot any arising challenges. Seed round enables the founders with enough time to shape the business model, adequate opportunities to connect with the business partners behind the mission, facilitate lower dilution and more capital for future rounds and is more flexible to changes based on market expectations.

Get to know series A

Series A comes into picture while the business model is already developed and established. When you opt to receive series A funding, you are expected to grow fast. Hence it is necessary to have the product market fit as well as established systems that will help multiply the revenue within a short time. The key advantages of series A funding include the ability to grow faster with the help of more cash and larger partners. It assures a better recognition within the community.

Working with the options

Since seed round will give you the flexibility and time needed to stabilize your business, it is essential to go through this step before raising series A capital. Nevertheless, skipping this step and directly jumping into series A makes sense when the start-up needs a large amount of capital that is not possible to get through a seed round and when the founder is almost certain of generating the revenue straight away.

How to Invest In the Power of Networking for Your Business

March 18, 2018 in Startups

The new digital age has blessed businesses with several sophisticated avenues to grow. Networking is one of those rarest blessings that help businesses reach out those targeted customers in a highly effective way. However, one downside to networking is you must avoid looking like spam to your potential buyers since too many people have spoiled the reputation of networking through their spamming activities. Here are a few tips adopted by some successful entrepreneurs to make the best use of networking.

Evoke curiosity

Understand the needs of your target group. Innovate ways to support their ventures and show that you care for them. Those who were benefitted by you will invariably support you as well b turning your loyal customers.

Contribute your knowledge

Give the best of your stuff, which can be useful and valuable to the people. Your knowledge and generosity can move people. Some might come back with a keen interest to buy more from you. While selling a product, you can throw insights on the problems that will make the buyers go for it.

Real relationships will pay you

When you achieve creating good relationships, people will come forward to support you and will turn your supporters in the long run. Keep them updated about your brand, its progress, and welcome people to invest in your firm. Real relationships can pay you in a big way.

Unlock the human element in you

For most successful entrepreneurs, their business is the 100 percent outcome of their network. When they build successful networks, they will not have to spam their audience, boost up their posts, run ads or hire an agency to promote their business. Treat every person in your network with respect. When you make them feel you are a good human, they understand you are capable of something big and bring you more business.

Why Global Launch of Your Startup Might Not be the Best Idea

March 2, 2018 in Startups

Suppose you are launching a food delivery startup and are targeting one city. You will have better chances of collaborating with local restaurants, eateries and cafe’s and able to deliver the orders in a specified location.

Once you know the loopholes, the problems and issues faced in collaboration, late and failed deliveries, customer feedback, and customer retention strategies, you will know that you are ready to launch similar operations in another city or maybe expand it to another state.

However, had you launched a nationwide food delivery operation, you may have run into multiple problems and might have to wind up your game.

The mantra of success for any business lies in creating adaptors or clients who are able to sustain your business and help you grow therefrom. A dedicated launch catering to a smaller clientele is always preferred rather than going global without any actual business done and issues faced and resolved.

Even if you go global or national and taste success early on, you are bound to have serious troubles because the growth would not be sustainable. There’s always a pattern of adoption of your product or services that you will see, and you better stick to it to avoid shocks at various intervals.

Even if you take the examples of the bigwigs of in the ernet who have now achieved global success and market-share including Facebook, Google, etc., you will notice they started from smaller territories, product or feature range, and grew on slowly. Like many other giants, Facebook bought a lot of startups which threatened its business model or added a value to its customers—Instagram and WhatsApp are two such examples.

So, if you are a startup and are planning to go national or global within 3 months of the launch, better hold your reins and gain experience from a smaller and controlled launch. Implement those learnings as you grow and you will have better chances of succeeding and fewer chances of failure.

3 Must-Have Entrepreneurial Skills For Every Startup During The First Year

February 13, 2018 in Startups

The first year in front of a start-up is never a bed of roses. The entrepreneur must be prepared to spare that strenuous extra work combined with a well-planned approach in order to bag success and steer the business towards progress. Here are three must-have entrepreneurial skills prescribed for every startup by experts especially for the first year.

Promotion is the key

Develop the ability to show yourself in a big way and let the people talk about your business. Business promotion involves several tactics. Ready the business promotional materials like business cards and flyers, and make the best use of social media, networks, and a powerful web presence. During the first year, it is important to find out what strategies and practices work best for you and learn how to engage the audience positively. Local networking events can help you develop some business insights and gather useful contacts.

Grow a great client base

Gaining the trust of the clients is the royal road to success. This is done by developing a positive client relationship. Implement honest practices and transparency across the business practices. Never resort to anything that will stain your relationship with the clients and end up ruining your reputation. Creating personal bonds with your clients can help distinguish your business from the big companies. For instance, personalized messages and emails will work wonders than automated responses.

Develop flexibility

Never step into the river until you have gauged the depth. Come out of your comfort zone and accept new roles. Develop strong leadership qualities and motivate your employees in a profound way. Learn from your experiences, mistakes, and pitfalls and rectify what did not work or what proved wrong. Never be obsessed with the finish line. Understand that to reach there how you run the race in every second is important. This approach will take you through the success path.

Are you really a startup? Introspect!

February 6, 2018 in Startups

If you have been working in the modern world that is abuzz with words like ‘disruption,’ ‘unicorn,’ ‘marketing strategy,’ and obviously ‘startup,’ you must have some confusion about the real meaning of these terms.

Almost all the youngsters graduating from various professional courses are excited about starting a ‘startup’ and calling themselves ‘entrepreneurs’ instead of engineers, doctor, advocates, or even financial analysts. I see a lot of people who even take up their father’s place in a grocery shop and start editing their social media profiles and declaring their occupation as ‘running a startup’. There is nothing wrong in that, but it often becomes misleading, because the industry wants to focus on businesses or ideas that could bring change and actual disruption. You could become a successful small business or a company, but till you do something impactful that could bring change to the lives of the people, you are not a ‘startup.’

Being a ‘startup,’ you will need guidance, mentorship, and financial support so that VCs, Angels, and even the whole community could offer their expertise, lend their help, and also support you in your journey. If any ‘startup’ becomes successful, more often than not, it will help many people and eventually changes the way the world works or even bring a new habit that is adopted by many people. Consider the way we connect with each other, and how social media startups have changed our way of sharing our moments with each other. Consider how we are now less prone to buy cars and to think of hiring on-call taxis. Consider how home-stays are becoming popular instead of luxurious hotels.

Entrepreneurship involves a lot of hustle and taking the world head-on because eventually, you want to change the way the world works, but it has to be meaningful and impactful—simply calling yourself a ‘startup’ would not mean anything, and you won’t gain anything by declaring your occupation as ‘running a startup’.

Can Customer Feedbacks Stop the Product Death Cycle?

January 23, 2018 in Startups

The stories of almost all the successful businesses are often familiar, though the industry that they operate in may differ, and even the size may differ. There is an undercurrent of development and ultimately decline paths that they share and also the business trends that run common.

As a business manager or an owner of a business, you must have heard about the term ‘product death cycle.’ After peaking in your business, the demand for your products slows down, and you take feedback from your existing customers to make it more appealing till the market dies down completely.

The crucial question is: “Can asking customers to provide feedback about what features they would like to have in your product actually save your product?”

The answer is ‘no’.

You will end up spending your precious time and resources on creating or infusing new features in your product but there would be hardly any upward change in the demand.

What can be done?

The situation demands to go back to your start point. What did you do ab initio to make your business successful? What was the factor that set you apart from your competition? What did you offer to your customers that they could not stop buying your product?

Draw those strategies and methods on a paper and compare them to what you are missing in the current scenario.

Don’t focus too much on the current set of your customers—think what you can do to capture new customers. Maybe, think it as a new life cycle for the product.

Always be ready to adopt innovation and change. If you are not ready to adopt change, you are staring point-blank at the disaster. A few patches here and there and some cosmetic fixes might not do the trick for you. Think afresh and start with the same zeal that made you successful at the beginning of your business.

Mistakes not to Make While Making a Pitch for Fundraising

January 19, 2018 in Startups

Being an entrepreneur is never an easy task, but many have already failed at doing something. Failure, most of the times, leads to lessons and learnings, which could prove valuable to the people who would try doing something similar or do the same thing. That’s why the advice on mistakes that could kill your fundraising pitch is so crucial—people have already failed to raise funds by making these mistakes. You should not!

Below is some advice that you can take in your stride to avoid failure while pitching for fundraising:

  1. While pitching before the investors, get to the point early. The point of your idea or the startup. What problem you are going to address or solve. Don’t give a general description of the market or industry. In short, get them excited about the idea.
  2. Try focusing on a single or a couple of problems. Don’t take a bucket-load of problems to solve—try being more focused.
  3. Don’t speed up your presentation too much. Try making your speech audible and understandable.
  4. Highlight the competitive advantage of your product. Show the metrics for user engagement and other relevant data to prove that customers will love your product over your competition.
  5. Show them how you are going to make money. Almost no investor will fund an idea that does not have a business model.
  6. Avoid going into technical jargon too much. To keep things interesting, keep them simple and avoid difficult terminology.
  7. Don’t make your presentation deck too smart or bad—keep it balanced and legible so that whatever you are showing is at least readable.

It is obvious to be little bit nervous and conscious if you are in the initial phases of funding and haven’t done the pitching quite often, yet practice will make you more comfortable and relaxed. This ensures that your delivery is smooth and is not hurried.

Why Family and Friends Might Not be your Ideal First Customers?

January 8, 2018 in Startups

At the beginning of the business, it is very crucial for any startup to find the real customers—the first customers, who would care to adopt their product, services, etc. However, almost every startup has an approved and accepted policy to believe that friends and family members are the ideal first clients, and they do not need to search and acquire real customers in the beginning.

Well, this is not the ideal situation. You can have family and friends use your product or services, but you should always try to reach out to the early adopters in a proactive manner.

Why? Here are some reasons:

  1. The real customers will be ideal to test your product or service in the real-world scenario. They will tell you whether you are ready for market launch or not and whether the product or service provides a real value to the user for which he/she would be willing to pay or spend the required time.
  2. Whether you are in the stealth mode or don’t want your competitors to know about you, you can isolate yourself from being in the market. Sooner or later, the word will spread—it is better to be a leader in the product or service launch.
  3. Whether they invested or not, whether they are the target market or not, it is always good to have some real customers test your product or service. The feedback from your family and friends could be biased. Have you seen businesses paying mystery shoppers for a feedback that does not have any bias and gives them insights that are so valuable to the business?
  4. Reaching out to some initial clients will also know the demographics and kind of customers that will be willing to adopt your product or service. Pick a target of maybe 500-1000 initial customers and take feedback—work on that feedback and then launch your product/service on a larger scale.

Your family and friends may be your target audience, but it always makes sense to have unknown people as your first clients because their behavior and attitude towards your product/service would encourage you and provide you valuable inputs for future strategic decisions and policy.

The Minimal Requirements of a Functional Tech Startup

January 4, 2018 in Startups

Depending upon the nature of the business, every business unit or a startup would have a different kind of requirements to run an office. But in most of the early-stage tech startups, few main activities are being focused on writing code or designing hardware, etc. So, keeping these two activities in sight, we are listing items and facilities that will be required on a minimal basis for such startups to be functional:

  1. Computers/Laptops: For a great hard-core coding experience, you need to have very sustainable computers or laptops as per the preference of the team, and also multiple monitors.
  2. High-speed Internet: It should not be a requirement even because it is like breathing. If you don’t have a high-speed wi-fi and wired internet facility, you are not running a tech startup. Start doing vegetables instead!
  3. Tables or Desks & Chairs: To make sure the team is provided with the most suitable, ergonomically suitable and comfortable desks and chairs for long-hour work, you need to set a special budget. There is no excuse for this!
  4. Whiteboards: Whiteboards are almost indispensable in a tech startup.
  5. Phones: Though initially personal smartphones of the team members will fill in the place, but as you grow, you will need to go for desk phones.
  6. Software: Depending upon the type of work your startup does, you will need related software tools to make sure every team member is technologically enabled.
  7. Food/Pantry: Never underestimate the power and attraction of a good pantry and snacks in a tech startup regarding attracting great talent and also making sure that you are a considerate employer. It is referred to as one of the highlights in the job descriptions posted on various job boards.

Apart from these fundamental requirements, there would be others too that may vary according to geography, culture, personal interest and passion, and also on the habits of the team members.