The Strategist

How to kill your business in just a year

04/05/2019 - 12:20

90% of startups do not live enough to celebrate their first birthday. It's very easy to spoil everything in the first year of work. How to do it? Easy, just follow the steps below.

1. Think only about the idea

Put your product upfront and forget about the consumer. Your product is so good that a client will sure be fond of it. Think not about about sales, do not outline the target audience and do not build the path from need to purchase. Unique selling proposition is the main thing.

This approach means vague positioning and lack of strategy. And the result is a crash.

Do the opposite. First determine who your customer is. Outline portraits of the target audience. Then, create a simple strategy by determining what you are selling, to whom and how.

2. Forget strategy

You already have a cool product and a great unique selling proposition, but you will think about strategy when you gain momentum. And in general, in order to position yourself, you must first enter the market.

When a business has a clearly formulated strategy, then it becomes clear what exactly needs to be done.

Positioning allows you to reduce errors and gain a foothold in the market. Form a price and think through a good marketing campaign.

3. Plan quickly

You want to receive additional funds for business development, and the investor needs a startup growth scenario. Make a business plan the night before communicating with him.

Do not hurry. In business, any planning will be just a hypothesis. Everything in your sphere can change in just two months: from appearance of competitors to the complete change in the needs of your customers.

A semi-annual plan is not enough. We need to think through several options for action. Plan A, Plan B and even Plan C. Such planning in conditions of high uncertainty will allow you to think through many options for development and to avoid negative events.

4. “Polish” the product before starting

The market cannot see your idea as imperfect. If it’s a website, make it multipage. If it’s a package, make it branded and expensive. Do not run the project until you fix all the flaws.

LinkedIn co-founder Reid Hoffman said: "If you are not ashamed of your product, it means you launched it too late." You can edit, find flaws and improve to infinity. It is impossible to assess the prototype, and only the finished product will give understanding of all pros and cons. The longer you delay, the greater the likelihood that you will never run it.

5. Start the project first, care about the team later

You have a working group at the beginning of the journey. Eventually, it turn into a dream team. The main thing is to “infect” these people with your own ideas.

When your startup is at the beginning, and business processes are unstable, the team does not exist yet. Without your help, a group of people can turn into something anarchic, but not in a dream team.

Do not overdo it with endless meetings, meaningless discussions and endless reconciliations. It is exhausting, especially at the start.

6. Do not think about competitors

Your product is unique and your ideas are better. Although you are a new player, you will succeed. Or maybe you have no real competitors at all.

Many start-up entrepreneurs with such thoughts closed their projects very quickly. It is impossible to underestimate the competitive environment.

If there are competitors, identify competitive advantages. Find what you look like and make it different. Do not delay with the launch. By the time you enter the market, there will be much more competitors than you expected.

If there are no competitors, this is no reason to relax. This is a call that consumers need to “accustom” to your product. The blue ocean strategy also contains competitors, but not direct ones. If your product solves a consumer problem, think about how they solved it before you? What prevents them from continuing to do this?

Based on “Blue Ocean Strategy, Expanded Edition: How to Create Uncontested Market Space and Make the Competition Irrelevant” by W. Chan Kim

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