5 Ways to Prevent Startup Failure
The biggest fear for any startup’s founder is its premature failure and ultimate exit from market. Although market research indicates that 90% of startups fail, it is important to focus on the 10% and analyze why they are successful. There are five main methods to ensure the long-term success of a startup.
Walk in the Shoes of the Customer
Being close to customers is even more important for startups than established businesses. Steve Jobs once said, “Get closer than ever to your customers. So close that you will tell them what they need well before they realize it themselves.” This quote exemplifies the importance for a strong connection between a startup and its customers. Few startups have the revolutionary mind of Steve Jobs, but with diligent market research and strong customer relations they still have the tools necessary for success.
Furthermore, it is critical that startups accept customer feedback whether it be positive or negative. If the observation is negative then it is important to solve the problem to assure customer satisfaction. Customer feedback is the foundation of a strong business. By accepting the criticism and adapting appropriately, the business is bound to flourish.
It is extremely important for a startup to create a unique brand proposition of its product. The value of the product’s utility needs to be effectively communicated to the customer. The product needs to be developed with the goal of customer satisfaction in mind. The most important aspect of creating a product is that the customer understands its significance.
Every decision needs to be based on careful calculation. The viability of the product needs to be tested before its actual launch. This analysis can be done with customer feedback. Using the criticism as a foundation, the startup can work to build the next version of the product. While operating a startup, there should be few gut feeling decisions. Each step of production should be driven on the basis of calculations.
Invest in the Right Team
It is critical for a startup team to contain a diverse group of individuals with different backgrounds and interests. Most importantly, it is important that the startup team is able to problem solve and navigate through the problems of the business. A one-man empire should be completely avoided. A balanced team builds cooperation and further establishes a foundation upon which a startup can be successful.
Enhance Leadership Skills
Personal development is critical for any leader of a startup. A good leader will accept criticism and adapt accordingly. Furthermore, it is important to communicate, delegate, and channelize the energies of the team to be successful. With proper and effective leadership, the owner of a startup has the ability to accelerate the success of the business and build a solid plan for future profits.
Startups are often founded on the dreams of their owners but with proper market research, they have the ability to flourish into a long-term successful company. Starting the enterprise is the easy part, but sustaining its growth requires further effort and determination. If the aforementioned strategies are executed efficiently, it's possible to sustain such an expansion.
Gupta, S. (2018, August 13). Here is How Your Startup Can Avoid a Failure. Retrieved June 11, 2019, from https://www.entrepreneur.com/article/318375