Nine out of ten startups die. All entrepreneurs know this and hope that their company is the 10th one that survives and becomes the next big thing. Having a great problem, its solution, funding and the people to work on the solution means that you are 80% ready. The remaining 20% makes or breaks the start-up. You get the 20% right, you have a winner. These five rules may help to get that 20% right.
1. EUREKA... I have a solution !! -- Great !! But say what? We don't have problem. Sometimes because of a great solution your startup might secure a funding. But in reality no one might be looking for a solution because they may not have a problem at all. All so often, the VC realizes this in about an year or two and refuses to give any more funds, leading to the death of what might have been a very promising startup.
2. I am the Superman ... not ! No one is superman. Superman is an alien being. So because we are not super men and women, we need the right team to ensure that all aspects of business are taken care of. That would include Finance, Legal, Marketing, Business development, Technology, Sales and so forth. You need to have the right people to do the job right.
3. Philanthropy .. is done by people who have a lot of money left after their own expenses are taken care of. So before you think of giving equity to all the people you hire, just so that they feel they are a part of something different and unique, STOP. Understand the skills, expectations and loyalties of people who join your organization before you take this decision. Not everyone is a saint.
4. I don't need no processes ... But you do !! Passion and commitment are a part of the 80%. For sustaining the momentum, you need the minimal processes and repeatability inculcated in the way you work. A lot of employees use startups as a stairway to something big that they have planned. They will leave and that's when people dependency and lack of process kills.
5. Back to the future.. teaches you to think of all the things that might go bad in the future and plan for them. I read a quote saying if you have plan B, you are planning to fail. That's not true. Don't believe in all the quotes that you read! Plan for disaster, manage your risks, have mitigation plans for everything. Also have a plan to scale. Too often startups are not able to come up with an idea as good as the first. As an entrepreneur you need to have plan to scale, diversify and take your startup to the next phase.. a winner.