Many believe that the business idea is the key to startup success. It’s not. Think your idea is unique? Think again. The truth is that somebody else probably already had your idea. The good news: It doesn’t matter who had the idea. The idea is only the starting point. What matters is a sound idea combined with great execution. Successful will be the founders that execute the best and adapt the quickest and pivot on their idea to offer the best product-market-fit according to actual real-world customer demand.
As a startup founder, you are on the starting line, summon your energies and get ready to run! Yet, what run are you actually preparing for? A marathon — not a sprint! As much as you may want to get to the finish line (e.g. a 7-figure-exit), you must be in this for the long haul. The rags-to-riches stories of overnight success are simply a fairytale. They do not exist. If you want to launch a startup, you must be prepared for at least 3 to 5 years until your business may really take off and provide solid income. That is a long and hard dry spell that demands every little bit of your patience and perseverance. Do you have what it takes?
Bill Gross, founder of “Idealab”, analysed hundreds of case studies and determined that timing is the single biggest determinant of startup success or failure. In other words, you need to execute on the right idea at the right time. If you are too early, the world isn’t ready for you. Customers don’t need your offering (yet) and will reject it. If you are too late, then other startups have already conquered the market and you can’t compete. This factor is somewhat disheartening because it is definitely outside of your control. After all, how could you even determine whether now is the right time or not? It’s probably a combination of instinct and sheer luck. Bill Gross suggests in his TED talk “The best way to assess timing is to look at whether consumers are really ready for what you have to offer them.”
Being a young start-up in a non-established market is like sailing in the big sea with a small boat. You are helplessly exposed to environmental conditions — the weather could turn at any moment, the winds may change, a storm could come up, rainfalls, etc. Everything can change in a heartbeat. This especially applies to regulation in dynamic and innovative markets like cryptocurrencies, artificial intelligence, and more. The sailor’s only hope of survival comes from being agile and flexible, being able to set the sail according to the winds. As a startup founder, how agile are you? Be flexible and embrace the idea of “pivoting” (incremental improvements on features and aspects of your offering or business model) from the beginning. Be Darwinian in your approach instead of being attached to your original ideas. It’s not about your idea, it’s about what customers actually need and are willing to pay for. Steve Blank, author of the start-up bible “The Four Steps to The Epiphany” said “Your business plan won’t survive first contact with customers.”
Remember inspirational stories like PostIt which were originally the result of a production fault at 3M until people realized the light adhesive could be used for what is commonly known today as “sticky notes”. You might make “mistakes” along the way that result in the creation of something much more valuable than your original idea!
The last thing busy startup founders want to do is to deal with complex and annoying red tape. That is perfectly understandable. Many successful entrepreneurs are more “big picture thinkers” and don’t have patience for the nitty-gritty of complex legislation and administrative obstacles. Yet the paperwork really matters. Startups must get it right from the start to be fully compliant with regulations and not risk running into legal issues. This is especially important if companies are in a regulatory sensitive field like fintech where AML/KYC and further regulation demand strict compliance and finest documentation of company procedures and customer data.
Yet paperwork also applies to the drafting of a business partnership agreement between co-founders. Yes, that is necessary to avoid potential conflict later down the road. Document your ownership stake.
Being a startup founder can be a very lonely undertaking at times. You may be the only one to believe in your idea to begin with, but that’s less the point. As a startup founder, you don’t have fixed working hours. Grabbing a drink Friday night with your corporate friends? You might have to sacrifice it for an urgent pivot in your business proposal. Spending the romantic weekend with your partner? Maybe your investors demand an urgent revision of the business plan or documents. As a startup founder you will often have to work on days and times of day where everybody else is relaxing or having time off. Be prepared to experience a roller coaster of emotions. Incredible successes may be followed by enormous setbacks. The highs are higher, the lows more frequent. You will generally invest more time and work for years — that is a lot of hours and time you will (literally) only be in your own company. Are you ready for that?
When looking at charismatic serial entrepreneurs like Elon Musk or Richard Branson, it is easy to (erroneously!) assume that these founders were always confident and knew they would succeed. In reality, however, all startup founders are full of self-doubt and worry. When you put your life on the line for that big idea, it is perfectly normal to have doubts. You simply cannot know whether it is going to work out or not. The key is to just accept them as part of the journey. You cannot let the doubt petrify you. Instead, develop the iron-clad discipline necessary to focus on the next step to take to propel the success of your venture. Always ask yourself “To lead my company to success — what is the most valuable use of my time right now?”
Yes, you are amazing! A highly skilled and ambitious entrepreneur who risks his time and money to lead a daring venture to success. Yes, you are experienced in your industry and know the market very well. BUT: NO, you don’t know it all. The world is too complex, the market too big and the necessary skill-set for success too broad. You don’t have to know it all. This is why you should hire people who know what you don’t. Focus on attracting and hiring the best people for those tasks and responsibilities you neither have the skill, qualification nor patience to excel in. This often means hiring people for tasks such as accounting, bookkeeping, technical documentation or human resources. Business-avid founders might need a CTO, technical experts might need a well-versed business development manager.
90 % of startups fail. Undoubtedly you have heard about this devastating statistic before. If you decide to venture into the startup land in spite of this likelihood then you most likely have a better and healthier attitude on making mistakes than the rest of the population that warn and try to keep you from starting such a daring (ad)venture. This includes your friends and family that ask if you are crazy to risk a comfortable corporate life for this risky idea.
Yet, it bears repeating. Perfection is the enemy of progress. Mistakes are inevitable. They are part of the journey. You are going to screw up bigly! Look forward to and embrace your next mistake — it is bound to happen! It is not about the mistakes you make, but the lessons you learn and how quickly you can improve upon them. The truth is that mistakes are the greatest potential for a better future. In some cases, this might even mean that one failed startup idea paves the way for the success of the next startup idea.
Being a start-up entrepreneur is a 24/7 job that isn’t tied to any specific office hours. It is a truly full-time task. After all, “it all rests with you.” Maintaining a work-life balance can be tricky. You will have to put in long hours, weekends, sleepless nights you would rather spend in the comfort of your bed. There will be emergencies and unexpected events. Whether market or investors demand your quick action — as a startup founder you must “always be on”. You can’t afford to wait, or your business might fail. Say goodbye to the idea of “me time” — at least for now.