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How to start a startup – Points to consider!

Is Just an Idea Enough…?
Points to ponder before start(ing) up…!
An innovative idea is the most important seed for a startup business venture. An innovative idea can bring about a significant change in the way a product or service is adopted by the customer, but there are a host of other aspects that come into play to make the idea a working business proposition.

An innovative idea is absolutely necessary to establish a startup. But an innovative idea alone does not guarantee success in the marketplace…!

What turns an idea into a successful business venture?

While an idea by itself may be innovative, the real challenge for the originator of the idea lies in:

Stitching the idea into a profitable business model:In this context, a business model essentially refers to (a) how the idea (or a product/service based on that idea) will deliver value to the end user (b) how it can be monetized, and (c) how scalable it is.
Evolving a go-to-market (GTM) strategy that takes the business model (essentially the idea) to the market:Having conceived an idea, how will it be taken to the end user? The first question a budding entrepreneur with an innovative idea has to ask is this: what will be the profile of an ideal customer for me? Will it be, for instance, an online user from the general population looking for a specific service, or will it be a corporate entity looking to address a specific business need?
Among other questions, the GTM strategy has to, at the minimum, answer the following questions:

What is the profile of my typical customer? This question helps segment the market into various categories
Where is my ideal customer located?This question helps segment the market into various territories / geographies
What problem does it solve for my customer, and how critical is that problem?This question helps draw up the ‘sales and marketing pitch’ for the customer
What are the typical expectations my ideal customer would have from my product/service?This helps identify whether there exists a similar product/service in the market, and how your idea can be differentiated from existing offerings
How much would my customer be willing to pay for my product or service?Am I able to offer my product/service at a particular cost, or should it be high or low?
Managing Funds/Bringing investments during incubation:Working capital requirements are one of the most important aspects to be factored while establishing a startup. Entrepreneurs at times have a heady conviction behind their product/service, making them unintentionally overlook the fact that employees have to be paid their salaries, and that rentals and utility bills are a monthly occurrence!
The best way to kick-start a venture is through ‘boot-strapping‘. Self generated funds, or funds sought/borrowed from friends and relatives have been the widely used avenue in raising initial capital to set the venture in motion. If this option is not feasible, or when additional funds are required investments can be brought in through other options too; loans towards working capital or equity infusion from the investor community. Both options have their own merits (or demerits depending on the perspective!) depending on which stage of the business lifecycle the startup is at the time.

The main advantage of a loan is that it keeps management control of the startup with the entrepreneur themselves. This enables the entrepreneur to take operational decisions on organisational strategy, product/service roadmap, etc. based on market conditions, and while doing so, stays in sync with the vision with which he started off.

Equity infusion is a double edged sword. While it gives the entrepreneur access to the potentially vast network of contacts held by the investors, he has to concede certain extent of management control. Equity infusion is ideal when the startup has started to yield revenue (perhaps not profits yet!); such infusion is required to take the startup to the next higher orbit of revenue and profitability.

Whatever the investment route the entrepreneur takes, it has to be aligned with the merit of the idea, the business model, the GTM strategy and the long term plans for the venture.

The People Perspective:Having conceived a brilliant idea, a robust business model to go with it, and a GTM strategy that addresses the needs of all possible market segments, how well is it going to be executed? Having right people on the right seat. It is important to bring on board people who have a shared passion and vision about the idea/product/service.
Working in startups is characterized by the absence of role clarity – every role in the company becomes multi-faceted! The CEO could find himself making a pitch for funding during an investor meeting, at the end of which he would need to pick up the telephone to cold call a potential client! These situations will be the norm rather than the exception; hence it is imperative that the people who form the core team do not bring any bureaucratic baggage about hierarchy, role-compartmentalisation and other related aspects.

The People perspective covers not only employees: it also covers external consultants, professional mentors, advisors, partners, vendors/suppliers and others who are equally critical to the success of the startup; they bring the much required view from an external perspective, and along with it, a (brutally!) honest assessment of any shortcomings in execution.

Managing growth after establishing the business model:The issues, challenges and priorities will start to change; from the time of business start, and+ when it has reached a certain stage.
Managing growth could also involve the exit strategy for the founders. When does a startup cease to be a startup? At what stage will the founder reduce their stake in the venture? Is it the vision of the founder to make his startup a global organisation? Alternatively, is it the vision of the founder to have his startup acquired by a larger organisation which sees his idea to complement their business (typically associated with serial entrepreneurs)? It is not surprising to see examples of startups working in niche areas, eventually getting acquired by larger enterprises.

The aspects captured above are just the tip of the iceberg. It is wise that these are best approached by having a clear vision, goals, and backed by a robust execution strategy.

Dwight Eisenhower once quipped, “In preparing for battle, I have always found that plans are useless but planning is indispensable.”

Indeed, establishing a startup is no different from a battle. While we may not have all the answers at the very beginning itself, there needs to be certain goals and milestones that needs to be signed-off but be flexible enough to incorporate any changes in plans or execution, during the journey!

Startup Xperts is a Business Growth and Consulting company with an objective to transform CEO’s growth vision into realistic, strategic, actionable plans that delivers results. Startup Xperts supports enterprises through business strategies, goal setting, sales and marketing set up, developing a high performance sales engine, digital marketing, specialized trainings, executive coaching and leadership hiring.

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Globally Recognized Certifications & Standards

Globalization has shrunk the world to an extent where we can see its impact in numerous instances in daily life. We use laptops and PCs for instance, which are assembled in China, with parts/subassemblies sourced from local and international manufacturers spread across the globe. When an Original Equipment Manufacturer (OEM) depends on a globally spread supply chain, it becomes imperative to ensure that the suppliers adhere to a well defined set of quality standards and organizational best practices.

Best practices that have an impact across the organization can fall under several functional areas: Quality Management, Environmental Safety, Organizational Health, Information Security, Process Improvement, Energy Management, Social Accountability, and so on.

Just as there are so many areas under which best practices can be categorized, organizations could look at several standards and certifications which establishes guidelines for managing their business effectively. In fact, for parts suppliers and manufacturers to compete in a global economy, they need to demonstrate their commitment to management excellence by getting accredited to globally recognized certifications as is relevant to their business.

Some of the most prominent globally recognized certifications that help organizations position themselves in the global marketplace are highlighted below.

(a) ISO 9001 – Quality Management System (QMS)

The ISO 9001 standard specifies the requirements for a Quality Management System where an organization is able to:

    • Consistently demonstrate its ability to provide products or services that meet customer expectations within the framework of applicable local/regional statutory & regulatory requirements
    • Ensure that its business processes are designed for continuous improvement through effective use of checks and balances to deliver products and services that meet customer expectations.

ISO 9001 standards have evolved over time, and in their current form, draw the focus towards achieving customer satisfaction. The accreditation process for ISO 9001 now measures the extent to which business processes as defined by the organization will be able to achieve customer satisfaction.

Benefits of ISO 9001 accreditation include:

  • Gives visibility to the senior management through an efficient quality management process
  • Clearly defines the areas of responsibility and accountability across the organization
  • Identifies and develops more efficient and time saving processes
  • Highlights process deficiencies, and thereby areas for continuous improvement
  • Reduces operational costs

(b) ISO 14001: Environmental Management Systems (EMS)

The ISO 14001 is a standard for environmental management systems applicable to all businesses. The objective of this standard is to reduce the environmental footprint of a business and to decrease the pollution and waste that a business produces.

The ISO 14001 standard can be adopted by any organization that seeks to improve the environmental impact of their business operations. This standard is of particular importance to large multi-national, multi-site companies, manufacturing, process and service industries across all industry sectors.

The benefits of ISO 14001 accreditation include:

  • A more proactive and measured process for environmental sustainability across the supply chain
  • Enhanced levels of waste reduction
  • Enhanced level of employee health and welfare
  • Reduced impact of business operations to the surrounding environment
  • Adherence to regulatory requirements on environmental impact

(c) ISO 27001 : Information Security Management Systems (ISMS)

The ISO 27001 standard is largely targeted towards IT/Software and Systems engineering companies. The information security controls in a business operation typically address important aspects of Information Technology or data security. In today’s connected world, information present in the IT infrastructure of organizations is one of the most valuable assets. Information assets are held by organizations on behalf of their customers, by virtue of providing them business services

It thus becomes imperative for organizations to ensure that:

There exists a robust process to examine the organization’s information security risks, taking account of the threats, vulnerabilities and impacts
Designs and implements a coherent and comprehensive suite of information security controls and/or other forms of risk treatment (such as risk avoidance or risk transfer) to address those risks that it deems unacceptable
Adopts an overarching management process to ensure that the information security controls continue to meet the organization’s information security needs on an on-going basis

(d) Organizational Health and Safety Assessment Standard (OHSAS) 18001

The OHSAS 18001 is a non-ISO standard which deals with how Occupational Health and Safety of employees, contractors and visitors in an organization is effectively managed. The OHSAS standard draws attention of organizations to the potential risks/occupational health and safety hazards that persons can encounter during the course of their duties in the organization. It also helps organizations identify the regional regulatory and legislative requirements with respect to Occupational Health and Safety

.
The OHSAS standard is compatible with ISO 9001 and ISO 14001 standards, and can hence be approached from the traditional Plan-Do-Check-Act sequence of implementation.

Organizations accredited to the OHSAS standard derive the following benefits:

  • Reduce the exposure of employees and other parties to occupational
  • health and safety risks associated with their business activities
  • Potential reduction in resultant costs
  • Greater assurance of conformance with occupational health and safety guidelines
  • Demonstration of conformance to third parties, and of due diligence generally
  • Consistent and proven management approach to health and safety, present and future
  • Deployment of method for continual improvement of the occupational health and safety management system

(e) Software Engineering Institute – Capability Maturity Model (SEI-CMM)

The CMM Process Improvement & Certification process enables software product organizations and software services companies to benchmark their processes at five levels:

  • Level 1-Initial: Processes unpredictable and poorly managed
  • Level 2-Managed: Processes defined by nature of projects and is reactive
  • Level 3-Defined: Processes defined by the organization, and are reactive
  • Level 4-Quantitatively Managed: Processes are measured and controlled
  • Level 5-Optimizing: Organisational focus is on process improvement; defect prevention

Each of these levels could be attributed to software product companies, in which case the applicable model is referred to as CMMI-Product & Service Development (CMMI-DEV). Where it is to be attributed to Software Services, it is referred to as CMMI-Service Acquisition and Management (CMMI-SVC).

The certifications mentioned above some of the most prominent ones that apply to a wide spectrum of industries. There are other certifications, sometimes derived/extended from the parent ISO QMS that deal with Energy Management, Safety in Food Manufacturing, etc. Likewise, organizations could also look at Six Sigma based approaches for process improvement.

The common denominator amongst all certification programs is that they demonstrate the existence of well-defined management approaches to running all the business processes in an organization. By virtue of being globally recognized, these certifications help organizations position themselves in the global supply chain.

Startup Xperts is a Business Growth and Consulting company with an objective to transform CEO’s growth vision into realistic, strategic, actionable plans that delivers results. Startup Xperts supports enterprises through business strategies, goal setting, sales and marketing set up, developing a high performance sales engine, digital marketing, specialized trainings, executive coaching and leadership hiring. Whether the organization wishes to move forward with ISO / CMM certification or have systems and processes that are world class, equivalent to ISO/CMM standards, Startup Xperts provides its expertise in getting these organizations ready for this initiative in a highly efficient and a cost effective way.

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Startup Accelerators – why and what is expected ?

India has become one of the world’s favourite ‘startup’ destinations. The numbers say it all!

  • Over 4200 new age companies have come up during the last year. As per NASSCOM’s statistics we have over 3100 startups in IT (as of last year) and expected to have 11,500 startups by 2020.
  • Being the youngest startup nation, and 2 out of every 3 founders are under 35 years.
  • Almost $5 billion worth funding has been pumped into Indian startups in 2015.

Well the stats can go on, but the key point to consider here is that the environment has never been better for a great startup ecosystem to get built. At a time, while the rapid rise is on for the startup industry, how long can it LAST and how many of those can actually SCALE?

Well the stats can go on, but the key point to consider here is that the environment has never been better for a great startup ecosystem to get built. At a time, while the rapid rise is on for the startup industry, how long can it LAST and how many of those can actually SCALE?

Many startups face challenges in even having an office space for their work. With limited funds, lot many of them cannot afford a proper working space and address. Here comes incubators who do provide co-working space for startups and this trend is picking up across various cities over the past few years.

To facilitate startup ecosystem, there are enablers like TiE, NASSCOM, CII, BYST, etc. who provide a platform for startups and bring together mentors, investors, incubators, and other stakeholders. This is also witnessing increasing tractions, as we can see from the number of such events being conducted across cities.

To ensure that we have a solid startup ecosystem, and one that sustains over long term, is to have good accelerators. So who are, and why, ‘startup accelerators’?

Startup accelerators support early stage high growth companies through incubation, mentoring, investments, and guide them through their journey.

Today, many companies call themselves accelerators but not really sure as to what they offer other than incubation space, and possible networking with investors. I would say, ‘accelerators’ are meant to ‘accelerate the startups’ businesses. Startup accelerators need to ensure that startups tread in the right path, direction, and do course correction when and where required. These accelerators need to have a business model that incentivizes them when these startups perform. This gives both the startups and startup accelerators a win-win proposition.

You might have heard about the famous Y-Combinator in the US. Based in Boston, it was the first seed accelerator program that I know of. They add a lot of value for those startups who have the opportunity to work with them. Accelerators typically have a cycle time of 3-6 months of working with startups.

Startups, in order to increase their success quotient, need more nurturing than before due to dynamic market conditions, shift in technology, disruptive innovation, and many other factors that startups need to be aware of during their journey. The growth can be exponential and at the same time can go down deeply, if they tread on a wrong path.

Startup accelerators need to support today’s young entrepreneurs through incubation, mentoring, connecting with potential investors, perfecting their pitch to investors, and guiding them through their journey. By doing this they certainly can create a positive impact in our society and also help build a better startup ecosystem which is essential for our rising economy.

Startup Xperts is a business accelerator supporting startups, small medium enterprises, boutique firms, by driving their go-to-market strategies, digital marketing, smart sales initiatives, to accelerate their revenue growth.

To know more about Startup Xperts, visit us at www.startupxperts.com or write to us at info@startupxperts.comThe views expressed in this article are that of the author’s and Startup Xperts is not responsible for this content. In case of any objection in content, IP violation, incorrect or inappropriate information, please inform us at ceo@startupxperts.com. We will do our best to act on it at the earliest.

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How to find the right mentor for your startup? 9 things to be considered

With numerous startups coming up every other day all over the world, there is a definite need for startup consultant. The requirement and demand has never been so much, and one of the primary reasons that entrepreneurs looks for a good mentor is to ensure that nothing goes wrong during their startup journey.

Unlike other services, are startup mentors easily available? Can they add value? Can they increase the success ratio of the aspiring entrepreneurs or startup founders? The answer actually has two sides;

One who has ‘been there, done that’ kind of professionals are too busy in their own stream of things. Being an entrepreneur themselves it is hard for them to find time to dedicate to many startups who seek their advice. So those, while still being busy, who are able to spend a fraction of their time with your idea, your product, your vision, are a smaller fraction of these ‘available’ mentors. So it is best to figure out if they are available and can they really spend that quality time with you to build your dreams.

Now, the next question will be how to find the right startup mentor?

It is not a simple way to just look for and asking someone. You will need to be clear as to what you wish to accomplish; what your strengths are; where do you exactly need the support of a mentor; what aspects do you feel that the mentor should look at while are you busy building your vision, your entity; and many more.

Well, the reason you are looking for a good mentor is to help you avoid those pitfalls which you may fail to notice. The following are some pointers that I have usually shared with so many young entrepreneurs, aspiring entrepreneurs for how to choose a right startup mentor.

Need business or technical mentor?

Founders come with their own unique skills; while some have deep technical/technological expertise, while some may be finance experts. So you will need to be clear as to how you wish your mentor to bring those complimentary skills. A business mentor need not necessarily be from your area of expertise/domain, unless you need someone who you would like to contribute technically or technologically.

Powering your thought process:

A good mentor should also act as a ‘devil’s advocate’; should shoot the right questions at you to power your thinking process. They can help transform your team’s thought process. A good mentor should also be ready to push out of your comfort zones, whenever required.

Mentor in your city or anywhere?

There are some requirements that work best with a local mentor, based in your own city. But when either you are unable to find the right one, and if you are fine with a mentor outside of your city/town, it is fine to look for a mentor who is based in a distant location as long as that mentor can add value to your business. Even in the same city, meetings may not happen often. Second, with the technology transformation, you are connected to anyone, anytime, everywhere. So connections and communication has become so seamless it may be a good idea to rope in a right mentor outside of your base location too.

But then how to track and bring them on board?

There are a number of avenues today to spot a right mentor. You can either Google; or keep looking for the right person in various networking events, conferences, and other communities. Quickly prepare a list and do the following;

Follow their social profiles:

You can get to know about them if you can spend some time in LinkedIn or Twitter for example. Get to know their interests and their areas of expertise. Are they personalities who wish to contribute something back, to our society? Understand what motivates them to be in this business.

Be convincing: 

After squaring in on the right mentor, send them a professional note or mail seeking their mentorship. Your mail should look professional without mistakes; grammar errors are fine as we are not an English speaking country (yet) but it should not be carelessly composed. It is like making a ‘statement of purpose’ which you might have done in your college days.

Give them a good reason, as to why they should act as your mentor. Pick the phone and start a conversation. You will emerge with more clarity as to whether to sign up with that mentor or not.

Building relationship is the key to successful mentoring. Mentoring is built on trust and respect for mutual strengths. Mentoring should not be treated as just another casual or commercial transaction. Respect their time and consider that you are getting benefited because of their involvement in your entity.

How to strike an engagement deal?

There can be numerous ways to engage a mentor. It can be a non-commercial understanding and with a good relationship you can get things going. Or it can be a small commercial, incentive driven, with commitment to time spends clearly agreed upon.

There have been numerous instances that startups come with the proposal in terms of providing equity to get me on-board as their mentor/advisor. Though I have refused so many earlier, this also does have some merit if you look at it as a win-win value proposition. Just make sure that there is a cultural fit with that mentor, as he is like your co-founder sailing with your company for long. Once taken on-board, it will be difficult to push him/her out.

Move ahead with clear commitment to time slots, goals, milestones, to ensure that there are no misunderstandings or realizing the gap later between what was expected and what was achieved?

Not having the right mentor can make or break your idea or your startup. Mentors bring in a lot of wisdom, experience, insight, and their aspiration is also to see you through emerging successfully. So even if you are running your startup, enterprise (small or big) successfully it is always advisable to rope in good mentors, as advisors, for your business growth.

Startup Xperts is a business accelerator supporting startups, small medium enterprises, boutique firms, by driving their go-to-market strategies, digital marketing, smart sales initiatives, to accelerate their revenue growth.

To know more about Startup Xperts, visit us at www.startupxperts.com or write to us at info@startupxperts.com

The views expressed in this article are that of the author’s and Startup Xperts is not responsible for this content. In case of any objection in content, IP violation, incorrect or inappropriate information, please inform us at ceo@startupxperts.com. We will do our best to act on it at the earliest.

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Startups – how to get your digital marketing approach right?

Startups typically have two major challenges to overcome – Time and money. Though time is money by the old age saying, here we are considering the importance of both separately.

  • In a short period of time, startups have to create the impact, grow their business as it is a question of survival. Either grow or perish seems to be the order of the day.
  • At the same time, most startups do have limited resources (money and people) to create that impact in that short period of time. So the question unfolds as to how this can be effectively achieved in today’s world?

Doing things right Vs doing right things

You cannot do everything right. We are not in a perfect world, so you need to take right steps; doing right things are more important.

  1. Do you really know who your customer is and their need?
    Focus on your customer and their need. Rather than creating a product or service, trying to spend your resources and energy into selling it (I am not referring to blue ocean strategy here) do understand your prospective customer’s pain and/or gain. If you are not solving a big problem (like Uber, booking a taxi with a click of a button rather than waiting on the streets), or not able to demonstrate a big gain (like Apple iPhone, that created a bigger impact through rich user experience) then you may have to seriously relook at your offerings. Else create a ‘differentiator’ that stands apart. Bear in mind, you don’t need to be miles ahead to win a race, but just nose ahead!
  2. Create and expand your brand identity digitally
    It is a no brainer that startups need to create their brand identity, and not think that the brand building initiative is only for established or large enterprises. It is all about creating differentiation, building trust; and digital will be an easy and cost-effective way to build your brand. The first step is to create a website that resounds well with your business. With good dot-com names virtually not available, this might need a lot of searches to arrive at the right name that can strike a chord with your customers as well.
  3. Cheap digital marketing Vs cost-effective digital marketing
    I do keep receiving mailers that say that they can get website page rank in top search results; and that too at very cheap rates. I do wonder how this may even cover the cost of such resources if it has to be done in the right way it is supposed to be. To top it all I get zapped when they list out strategies that were used a few years ago, that’s not going to work in today’s scenario. Of course, how many do really know Google’s new algorithm released this year? Many startups have come back to us after experiencing these cheaper options, as they realized it is just a drain of money and time. Here the important aspect to note is that, time loss is a precious loss; and you have already burnt sufficient amount of your limited resources (funds) hoping that digital is going to create that impact. If it didn’t work, don’t blame digital; just that you didn’t do it right! So go for cost-effective digital marketing that has a well thought out strategy and execution planned, with clear timelines.
  4. Pick the right strategy
    You all very well know that no one size fits all. Digital is beautiful in that way, because custom strategy can be carved for every one of you – be it a boutique, services firm, product startup, retail outlet, etc. I have stressed the need of SEO many a times in my earlier articles; a balanced approach to SEO, SEM, and SMM is important for you to succeed in this business. There are strategies (pre-launch, during launch, post-launch) that you need to pick depending upon the stage of your startup.
  5. Do not put all eggs on one basket (Rephrased: Do not spend all your money on just one strategy)
    It is always advisable to go for A/B testing. Create two or more sets of messages (needless to mention across social channels, Adwords, etc.) to see which one works best. Fine tune and try to see if improvement in performance is seen. Result is always a moving target and so constant fine tuning is essential to get the overall momentum and impact right. I do notice, many make the mistake of spending their precious funds on a particular message, and come to a conclusion that digital hasn’t worked. I was not surprised because the messages were not right, or the audience was not chosen right, or probably wrong timing. Be it LinkedIn, or Twitter, or PPC, you need to take a balanced call as to which combination can maximize your visibility and achieve your set objectives and goals.

It is easy to say ‘go digital’. But digital is not just a technique; it is a tactic (strategy). Digital certainly can be done in a cost effective way, and more importantly measurable. You will be able to see where your dollars go, with reference to your spends on various buckets. So, starting this New Year 2016, are you ready to go digital more effectively?

Startup Xperts is a business accelerator supporting startups, small medium enterprises, boutique firms, by driving their go-to-market strategies, digital marketing, smart sales initiatives, to accelerate their revenue growth.

To know more about Startup Xperts, visit us at www.startupxperts.com or write to us at info@startupxperts.com

The views expressed in this article are that of the author’s and Startup Xperts is not responsible for this content. In case of any objection in content, IP violation, incorrect or inappropriate information, please inform us at ceo@startupxperts.com. We will do our best to act on it at the earliest.

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