Technology entrepreneurship continues to attract new talent and new interests, whether it be from Governments, industry or venture capital. Every day, new entrepreneurs take the plunge with the hope of creating the next tech giant.
However, not all succeed. The success rates are relatively small. How does one determine the success of a startup? It all boils down to the startup team, the product or service category they focus on, and the market they operate in.
Here are some tips for early-stage technology startups to survive and thrive:
No foolproof recipe for success
The road to success is tough and lonely. Sometimes, it is tempting for early-stage tech startups to emulate mature startups that have achieved scale and success. Such startups, in our experience, typically end up failing.
It is important for a tech startup to realize that the challenge one is seeking to resolve is unique, in terms of the problems, the market, and the target audience it is focused on. Having said so, we believe it is prudent for such a startup to look at its competition to garner insights on what works, and what does not. Such a market research helps startups in good stead.
Don’t spread yourself thin
Given the depth and breadth of various channels that are available to startups, it is important for startups to focus on a single channel, rather than spreading onself thin across various platforms.
When one evaluates successful startups, one would notice that most startups achieve their scale from a distinct channel.
Measure and adapt
Early stage startups should focus on defining their metrics for growth, and monitoring and evaluating them constantly. Rather than focusing on “feel good” metrics, such as traffic, it is imperative for startups to evaluate “cold” metrics, such as conversion rate. A constant focus on metrics helps a startup in its journey towards finding the ideal product/market niche. Measuring various metrics daily helps a early-stage tech startup to pause and measure its growth. While the focus should be on capturing all metrics, it is prudent to review and watch the most important metric.
Without metrics, a startup will be like a rudderless ship.
Ditch scale for customer delight
Instead of looking at scaling-up rapidly, technology startups should rather shun scaling-up until they have realized the ideal product fitment and target market. In order to do so, our experience suggests that such startups which focus on a small customer base, and spend time on engaging with them closely, tend to be better off over the long-term.
Be fluid in discovering your niche
In our experience, it is prudent for startups to start small by focusing on a niche segment. Such an approach helps understand the needs and aspirations of the target customers, enabling the startup to build and tailor their products to the right target demographic. Once a small customer base has been secured, startups can look at expanding and scaling-up their product portfolio, and the approaches.
While focusing on the “niche”, we believe it is equally important to be fluid for the startup. By moving beyond a strict goal focus, it is more important to retain the capabilities to adapt itself to new realities, in terms of target market needs and demographic aspirations, while reaching the final product fit stage.