Creating a start-up is relatively easy, but making it
successful is far more difficult. To blame are the competition, decrease of
profits and volatile loans.
Launching a start-up is convenient for real
or is it just the “new thing”?
Certainly we do live in the start-ups era, and there are several examples of
small companies that, having the right idea, were able to be successful.
However, these successes tend to eclipse all those start-ups that instead can’t
make it. The Economist talked about it in terms of “mass extinction”, as if the
majority of these technological experiments were doomed to fail (Surowiecki, 2014).
However, today the real problem is that
creating a start-up is easy, but having it to work effectively is way more
complicated. Since the creation of crowdfunding projects and websites, many
people had the chance to launch their inventions and see their great ideas turning
into successful realities.
Usually, the phase right after the launch is the most
delicate and pivotal for the existence of the start-up itself. Every aspect is
crucial and could compromise the future of the company, but there are three
situations that require a more thorough consideration.
1 1. Watch out for your competitors: the mere fact that launching a start-up is relatively easy
automatically increases the number of competitors. Before creating a new
start-up and start gathering the funds, it is wise to study in detail all the
potential competitors. Once the competition has been screened and evaluated, and
then it is possible to structure the business in a way to capture a particular
niche of the market that has been left out from others.
2 2. It is crucial to precisely define the target market. Firstly, because even
though there is a lot of money out there, there are also many start-ups, which
mean a dilution of profits. Secondly, if crowdfunding is useful to start the
opening of the new company, in order to keep the business going is necessary to
involve venture capitalists and/or angel investors. These guys have much
more competence and expertise of the business world, but, unlike the generous
donors of the crowdfunding websites, they also need to see potential profits
and returns for their investments.
3 3. Failures
Management: it is a common belief that entrepreneurs are generally not so
scared by the level of risk involved in their business. This is not completely
true, because they are simply more confident in their likelihood of success of
their activity. On the other hand, the startuppers
share the same mentality, but they usually do not give up not even after
repetitive mistakes and failures.
It is statistically inevitable that the
higher the number of start-ups, the higher the number of the failures. “There’s a widespread tendency to
treat failure as a badge of honor: ‘Fail fast, fail often’ is a familiar mantra
in Silicon Valley” (Surowiecki, 2014). This is connected with the general idea that making
mistakes will eventually lead to future success. However, the sad reality is
that the opposite is usually more realistic, meaning that who fails the first
time, very rarely has success the second one.
In conclusion, faith, confidence,
commitment and enthusiasm are positive attributes, but it is also important to
face reality and be able to understand and admit when our ideas just do not
work. However, in order to avoid a failure, an accurate and detailed market
analysis and a meticulous planning strategy can always increase the odds of
success.
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