Starting your own business has never seemed more cool or exciting than right about now. Everyone wants to do a startup and raise a million dollars! It’s a good dream to have; it’s also probably never been easier to get investors to believe in half-baked ideas that might one day find a mass audience. The problem lies in the vision. Let me explain, any idea that a person believes in seems exciting. We now tend to fall so much in love with this idea and that all sense of practicality fails to reach us and there is reason feeling guaranteed success! The idea only seems to be missing the fuel of money and funding seems to be the one sole goal for the entrepreneur. Now, I hate to shatter this dream but funding or money isn’t the secret to success. Startups like Food Panda, FabFurnish, TinyOwl, Housing.com, and many others are proof of this. I follow startups, VCs’, rounds of funding very closely because it’s very important to understand market trends, mistakes and what has been done right. While everyone obsesses overvaluations in the words of the Softbank’s President Nikesh Arora, “To live up to these valuations, there is a need for perfect execution!” So stop being a romantic and falling in love with ideas. Be passionate but practical because, in the end, the only thing that matters is execution! I will be writing a part two to this real soon about what a startup should focus on.
In our last blog, I explained why it can be dangerous to fall in love with ideas and lose focus on execution. So considering that what should a startup be focusing on? Here are the three things that can make or break a startup: 1. Structure It is very important to understand that a business has a legal side and having the right paperwork goes a long way. Also, think of structure in terms of the people that become a part of your business and what core functions will they be executing. Managing people is a core part of a successful startup because your team can be your biggest asset but also remember they come with a fixed cost that will be a major chunk of your burn. Remember, as an entrepreneur you can’t do everything on your own! 2. Profitability There are a lot of startups that focus on the adoption of their services and products versus profitability. Keep your eyes on the prize. While investors are ok with startups bleeding for a few years in order to become a mass accepted service/product, this usually motivates people to lose sight of the cost of customer acquisition and then most things go downhill from there. Any resource whether time, energy or money is spent must have a measurable and acceptable return on investment! 3. Scalability No one wants to invest in or run a company that can’t grow beyond its first ten customers. There must be constant innovation and growth because that is an undefined goal of every startup. It’s crucial to keep an eye on the competition, changes in technology and ensuring your concept is future proof. Someone bought 500 horses a day before the car was invented!
Entrepreneurship seems like a very romantic idea. After all, who wouldn’t want to be an owner of their own business? But the path to entrepreneurship is far from a rosy dream. It’s filled with hard work, dedication, and planning. So here are 5 tips for all the entrepreneurs who are aiming it big. 1. Practicality When you are an entrepreneur it becomes very easy to fall in love with an idea. Unique ideas that you think will work. But you also need to learn from the mistakes that people before have made. It seems like a very rosy picture to start your own business, but unfortunately, the world doesn’t work like that. There are a lot of practical decisions that you have to make. Realize the reasonability of the situation. Don’t just go with your gut feeling that ‘it’s just going to work because I believe in it’. Don’t fall in love with your idea so much, that you fail to see the practicality of the situation cause that might become the one thing that leads to your failure. 2. Patience Nothing happens overnight. It takes days and months and years before something works and you can scale it up. So don’t believe that in your first meeting you are going to get the funding or crack your biggest client. The idea you had for three months might actually take a whole year to scale it up. Shift your goals. Shift your guns. But don’t get demotivated. Everything takes time. You need to keep putting in the hard work every day. Only with that, the result will start showing. 3. People It’s very important to understand that you can’t do everything on your own. You might start out as an entrepreneur or a solopreneur, as a one-man army trying to cover up all the goals. But it’s not going to be possible. At some time you are going to need to build a team and give them responsibility. They might not necessarily be able to do what you can. But you need to believe that this what they can do and they are trying their best. And work with that situation. Because as an entrepreneur the most valuable asset you have is your time. Where you dedicate your time is very important. If you are giving time to the small things which actually can be done by someone else. You are wasting your time. Having the right people on board helps you to get more work done and achieve more goals. 4. Believe There are a lot of times when other people, your client, your team members say that this may not just work. Market changes, competitors changes and might make you think that maybe they are right. It is important that more than anyone else, you believe in yourself and your idea. Believe that it will work. Because it’s your belief that’s going to keep your passion and hard work alive. And it’s your passion that can touch your team members as well and fuel their hard work. If you don’t believe in yourself no one else can. 5. Adapt Market changes, competitor changes, team changes. The idea you started out with might not be a very practical one. But the thing that matters is whether you can adapt and address the market with your current setup. This is something that you need to learn to do. Many businesses are going to fail because of their lack of ability to adapt. Nokia, which was a leading mobile company which simply faded away because it could not adapt to the smartphone landscape. History has repeatedly taught us that no matter the scale of the company if they fail to adapt they will fail. So remember whether it is three months into the business, six months or ten years or sixty years. Never fail to adapt.
After having an opportunity of conversing with a crowd of college students recently, I have come to realize that the “entrepreneurship is cool” trend has been successful in prevailing through the years. I believe that following the trend has made most of them go wrong while taking the crucial decisions of their life. Most of them don’t seem to know what it is about and what it entails until they get into it. Everybody wants to be their own bosses and feel happy with the misconception that building a brand or a business takes only 2–3 years of time. With none of them deciding on being an entrepreneur for the right reasons, here are the best ways to test yourself and know if entrepreneurship is for you. The most important thing is to know what kind of entrepreneur you are. You either belong to the lot that can come up with an idea but are somehow unable to run a business or the lot that can execute an idea and successfully run the business. Entrepreneurs belonging to the first one always end up looking for a co-founder and it’s crucial to determine whether you need one or you don’t. The second most important thing is to analyze your idea. What is it and how do you work on it to make something huge out of it. Every idea must be passion-driven, something that makes you want to leave behind all the physical and mental barriers that stop you from achieving it. Maintaining a long term vision for your brand is an absolute necessity. It is not wise to be carried away by an idea that is “in” presently with not a great future. Entrepreneurship is not for those who wish to make a “quick buck”. Coming up with an idea that sounds good is easy but ask yourself whether it’s practical. The only thing I keep saying to those looking forward to being an entrepreneur is that don’t fall in love with your idea. The last thing that is a must-know is who your customers are. Analyze your audience, research as much as you can about who they are and what do they want. There might a really great idea that has struck your mind but it would be of no use if the customer doesn’t respond to it in a particular manner. Every business is a fail till the time the customers begin to find it interesting. Understanding their interests, need, price-sensitivity is the crux of every new business. Mastering the three things that I have mentioned can help me be a good entrepreneur. Everything else can be learned over a period of time. I believe that failure is a part of entrepreneurship on a daily basis. So if you nail everything else and aren’t too moved by the smaller daily failures and what people think about you. Take the ownership and the responsibility of your business and have a bit of a thick skin as if you don’t, you’d never be able to make your decisions that you can trust.