6 Important Keys to a Successful Startup Launch
A small business founder may dream of an entrepreneurial paradise staffed by top talent who will be well-paid and whose long-term allegiance will be secured by perks, such as sabbaticals, nap pods, massage chairs and on-site gyms.
But it takes more than an enduring fantasy to transform an entrepreneurial vision to a startup that has more than a 50/50 chance at survival for the near term, let alone the long term.
To boost the odds of a good idea becoming a good product and a good product becoming the foundation of a top-performing company, or at least a business that comes to be worth something more than the capital that stakeholders invested in it, a small business needs more than an idea lodged in an entrepreneur’s brain.
The business needs resources such as an innovative product or service that, with luck, might lead to more products or a product line, or perhaps a platform technology that represents a large market opportunity.
In each case, the asset must satisfy a market need and be something consumers want, and must be managed by personnel who will stay the course when facing operational and financial challenges that might discombobulate others.
6 Important Keys to a Successful Startup Launch
1. Innovative Products or Services
Although startups pop-up every day, the best ones enhance their probability for success by introducing an innovative product or service that offers a unique value to a customer.
While an embryonic concept might draw public interest, it’s the full-blown innovative product that offers real customer value to customers that establishes a company in the marketplace.
That perceived value will also determine the product’s price, which will determine the feasibility of its commercialization. In turn, it’s the commercialization of the product or service that assures the financial returns, which justifies development and startup costs.
2. The Potential Development of a Product Pipeline
An innovative concept, product or service that might be a forerunner to multiple other products or a product line makes a company’s success in its chosen market more likely than does a single product or service.
In part, this is true because a product pipeline is a more interesting prospect to investors who prefer to make a wager on a company with multiple income streams, rather than a “one-pony show.”
While a single-product idea might serve as the basis of a new business, it’s less attractive than a company whose product line offers a larger market opportunity.
3. A Product or Service That Fulfills a Customer Need and Want
To justify founding a company, an entrepreneur must offer a product or service that meets a customer need, but even more importantly, what they want. Hence the emphasis on identifying the first product or service a company will offer in a chosen market.
The single criterion to which a startup’s first product or service must adhere to is that the product or service satisfies an existing need or want in the real world.
Equally important is that the product or service fulfills a need in a desirable market and that it will likely ensure the company a competitive position in the market.
4. The Commitment of Appropriate Management Personnel to the Venture
Regardless of the desirability or marketability of a product or service, a startup that lacks adequate management will fail.
Startups face innumerable barriers during the different phases of company growth. In particular, early stage technology companies face an uphill grind to reach commercialization. But managers of any startup must possess the skills needed to acquire customers, raise capital, motivate a team and manage each business function from marketing to manufacturing in an appropriate way.
Few entrepreneurs possess these skills or have access to a sophisticated network populated with individuals who possess the very particular business skills that benefit a specific startup.
5. Access to Specialized Facilities
Once an entrepreneur receives funding, he must identify the space and equipment needed to make his dream a reality and that meets the company’s requirements in terms of cost and time schedule, as well as permits and regulations. For instance, to establish a company, an entrepreneur might need to identify a facility that can be secured and configured to best suit a particular purpose. As an alternative, the startup might contract functions to an external provider, which means the entrepreneur must evaluate providers in terms of qualifications, contracts and prior performance.
The entrepreneur must navigate the requirements of establishing his company’s facilities by overcoming any roadblock and taking a turn in direction when necessary.
6. Interact with Potential Investors to Secure Financing
The cost of taking a product or service to market determines a startup’s cash requirements.
It’s likely an entrepreneur who provides a service online will require less initial funding than will a founder who establishes a new manufacturing company.
In the latter case, an entrepreneur will spend numerous hours in attempts to secure a large amount of investment capital. Even after he secures the initial capital, a founder must then plan his efforts to obtain the next “round” of financing.
In any event, financial objectives will be determined by the business launch timeline and the nature of the product or service the company will offer.
The odds of a startup becoming a top performer depends on more than a product or service that is deemed by its chosen market to be “a good one.” The startup will require a truly innovative product, a sizable market, and knowledgeable and skilled staff members who are committed to the company’s success. The startup might also require the use of a specialized facility as well as sufficient funding to meet a company’s near- and long-term cost and payback requirements.