Three out of four startups end in failure – an oft-quoted statistic that haunts many entrepreneurs beginning their startup journey. While ‘fail fast’ has become a widely-accepted mantra in the world of startups, nobody wants to see their hard work and vision tank.
With so many articles, talks, books and videos offering guidance for entrepreneurs it can be difficult to wade through the information. Who better than investors – who have a great deal of experience helping startups grow – to offer their advice to first time entrepreneurs.
Here’s what they had to say:
Define your goals and stick to them
Megumi Ikeda, managing director at Hearst Ventures, said: “Be disciplined about where you focus your time and energy. While it’s important to keep up to speed with the latest trends, technology and competitors’ movements, it’s too easy to get distracted and lose your way. Clearly define your own goals and stay committed to achieving them,” she says.
Make culture a strategic advantage
Stan Laurent, partner at Highland Europe, added:
“Workplace culture is often overlooked or accidental at startups. But a corrosive culture, once established, can be hard to change. Thinking about what sort of culture you want to create early on gives you a strategic advantage. And remember that brand, product, people, process are all part of a cohesive culture.”
James Wise, partner at Balderton Capital, says it’s vital to think carefully about your team.
“There’s no escaping the fact that hiring is a laborious and time-consuming process, but it can truly make or break a startup. The ability and vision to build a world-changing startup doesn’t lie solely with the founder. All the early hires made will impact the scale that the startup can achieve,” he added.
Enjoy the ride and play the long game
Julia Hawkins, partner at LocalGlobe, went on to note: “People do their best work when they’re excited about their job and the same applies for startup founders. There will be many highs and lows along the way, so you have to embrace the challenge every day. Being an entrepreneur is all-consuming and building a business takes years, so make sure you give yourself time to recharge and reflect on the process.”
Cash flow and timing is everything
Sandy Mckinnon, partner at Pentech Ventures, says startups “should always be closing”.
“When you’ve just finished an investment round, you probably don’t want to be thinking about the next. However, too often people wait until money is running out before they think about raising more capital. You need to give yourself at least six months buffer to get any round closed, so creating a cash flow management plan will help protect you from falling on harder times. This enables you to focus on growing your business fast,” he concluded.