Start up has become a huge buzzword lately. Everyone wants to build their startup today and grow it to form a successful company some day. If you are someone who is already running a startup and looking for tips to make it successful then your choices are limited. Surely, you can still utilize the tips and optimize the business that you already have and make it further successful. But for those who are simply looking for ideas to make their startups, they have an opportunity to start on the right foot.
If you are planning on a startup and you want to make it a success in the near future then follow the below tips and make sure that the startup you are planning, passes the various points mentioned in the articles.
1. Lean Startup: This is the first thing one should look into a startup. If the business you are building isn’t heavy on the codes, that is it is easy to get started and the technical aspects of it is low and developments costs are a bare minimum, then the overall business is lean.
When we start a business, the biggest obstacle is mostly the development side of the business. If the cost of getting started is too heavy, the regular maintenance is costly, then it is a business that one should probably skip.
2. Profitable from the Start: If you are starting a business that might be able to sell something in the future, where the revenue model isn’t as clear then you should re-think your idea. A good startup should make money from the first day and should be profitable from the start.
3. Unit Economics: At the very core of any business is the unit from where it is making money. This unit is basically a customer or a sale that happens as a regular of marketing activities. So, if you spend money to acquire a customer and get a sale and the money you have spent to get that customer is lower than the value of the customer, then it is a positive unit economics.
This unit might not be positive right away but if you calculate the lifetime value of a customer and it is positive at some point of time in the future, then it is still a positive unit economic.
4. Market Size: Whatever market you are in, if the full size of the specific market is huge then you and your investors have a good opportunity to grow in the future. However, if your marketing size isn’t in the billions, or the market is declining and moving over to something else, then at a larger scale, the business has an issue.
5. Subscription model: One of the easiest ways to grow a business is by creating a paid subscription model. This way, even if the cost of acquisition of a customer is higher, the business will still be profitable in the long run, as the monthly subscription revenue will make way for the profits in the near future.
A subscription business model is also a stable and safe way to grow a business. Here, one does not really have to worry about the next sale, as every order is a repeat order and at the end of the month, the business knows that its customers will be billed and money will keep flowing in.
6. Scalable: There are several ways to scale a business. One of the easiest ways to grow and scale a business is by utilizing pay-per-click advertisement model. If the business can easily be scaled by putting advertisement money and getting sales, then the model can be quickly grown. Surely, the unit economics still stands as the ad expenditure needs to be lower than the sales amount, else it cannot be sustained in the long run.
7. Easy Exit: For the founders, investors and the team, as much as it is important to stay involved and get the business growing, it is equally important to have an exit route. No one wants to stay bounded to a business. Knowing the exit option gives everyone the flexibility to leave the startup and make way for others to join in and fill the gap.
8. Investable: A startup should be investable. If it is too difficult to invest in the startup then the chances of growing it and scaling it is slim. There can be several reasons why a startup isn’t investable, for example the market size is small, the founders aren’t easy to work with, the churn rate is high or the product isn’t market fit. Whatever be the cause, but if the startup can’t be invested in, then it won’t grow.
9. Build a Team: While growing a startup, it is often seen that the founders are so involved and talented that they think, they can do everything by themselves. This is helpful up to a certain extent, but after that the process becomes difficult and rather than helping, it starts to hurt the progress of the startup.
Even if the founders are good at everything, one should still focus on building a team so that many aspects of the business can be managed and run by others and free up the founders time.
10. Churn Rate: Any business will have a churn rate as it is almost impossible to please everyone. At the end of the month, some customers will leave the business and move away. However, it is still best to have this rate, as low as possible. It is always expensive to acquire a new customer, so making sure that existing customers stay it a top priority.
11. Utilize Content Marketing: Not all marketing has to be expensive. There are some free and cheaper ways to market a business, for example, SEO, starting a blog and doing content marketing.
12. Optimize for Social: Social media has grown to become a huge marketplace for businesses to make the best out of it. Build a following on sites like instagram, make video content and target sites like YouTube and TicTok, stay up to date on sites like Facebook, twitter, Pinterest etc.
With the growing amount of startups in the world, the space is getting competitive and slowly the chances of making money from growing a startup is becoming increasingly difficult. In a competitive market, it is important to take care of the basics and grow the business in the correct way and monetize it and keep growing it day by day.