You have come up with an idea for a startup, researched and validated your idea, and figured out how you will fund it. You may believe that you are ready to incorporate and launch your company but you must first prepare and do your homework to reduce your chances of failure.
“Inspiration does exist, but it must find you working.”
"Maybe Customer Could Be Always Right."
Even with a great team and solid financials, your company will struggle without a strong understanding of customer needs. How do you acquire this information? By repeatedly exposing yourself to the harsh, direct feedback of the market. Engage with customers individually and find out whether they are interested in buying the solution you offer. This kind of marketing is indistinguishable from sales: you are talking to a small group of people interested in your specific product, not a broad audience who is largely indifferent. Marketing like this can be hard, demoralising work. Mediocre founders often prefer to go to conferences and meetups to shield themselves from the unpleasant truths they’ll discover if they talk to users.
Your aim in these customer conversations is to acquire as much information about your clients as possible. Strong sales are driven by knowing how paying for your product or service benefits your clients’ lives, so you want to make sure that this information is easily accessible to your employees. Reflect on questions like:….Who are your clients?
- Who are your clients?
- How old are they?
- Where do they work?
- What is their budget?
- When do they buy?
- How do they buy?
- Why do they buy?
- Who do they buy from?
- What do they think about your competitors?
- What do they expect from you?
- Why do they need you?
- Who is responsible for the purchasing decision? (in B2B sales)
- How large a company are they? (in B2B sales)
Ready yourself as a founder
Too often, passionate entrepreneurs leap head first into a venture before thinking it through. To improve your readiness to succeed as a startup founder, take an honest look at yourself as a founder before leaping. The first step is: Clarify your reasons and your goals. Why are you doing this? What do you hope to achieve? The second critical step is: Understand your entrepreneurial personality. What makes you tick? From there, focus on ways to leverage your skills, assets, resources, and relationships.
Attach to the market, not only your idea.
Passion is an inner phenomenon, but all healthy businesses are rooted outside the founder, in the marketplace. To turn your passion into profits, emphasize the market—always think about your business relative to the customers you serve; know your markets—strive to understand the needs and preferences of your core customers; and execute on your market opportunity by placing a priority on your customer’s experience and perception of value.
Ensure that your passion adds up.
Passionate entrepreneurs tend to develop rose-colored plans, over-estimating early sales and underestimating costs. To convert your passion into tangible business value, emphasize the importance of planning plus math. Write a business plan that makes financial sense for the current needs and future goals of your startup.
Construct a compelling math story, covering how the elements of your business will come together in a way that is profitable over time. Address the crucial issue of funding: how much is required and from what sources.
Execute with focused flexibility.
No amount of startup planning can accurately predict the unexpected twists and turns imposed by reality. To succeed, a new venture needs both iteration and agility. Establish an ongoing process for translating ideas into actions and results, followed by evaluation. Test and adapt your concept as early as possible. Work on continually improving the fit between your big idea and the marketplace.
Cultivate integrity of communication.
Passionate commitment to an idea can breed reality distortion. That is, aspiring entrepreneurs often see only what they want to see and rely on “feeling good” about their venture as their only measure of success. To avoid these dangers, commit to truth-telling and welcome healthy debate, even tough conversation, from the start of your startup. Commit to building the skills essential for high-integrity communication: curiosity, humility, candor, and scrutiny.
Build stamina and staying power.
Contributing factors aside, most startups fail because they run out of money or time. To lengthen and strengthen your venture’s runway, aim to launch close to the customer (ideally with paying customers already in hand) and raise more money than you’ll think you need. Focus on building personal staying power. Healthy entrepreneurial stamina is not just about the refusal to quit, but is grounded in ongoing learning and improvement.
