You’ve heard the stats. Only 10% of startups survive beyond the first five years. The first three years of business don’t even show a profit. On and on they go.
These are reality for most new businesses. But it doesn’t have to be for you.
I’ll let you in on the startup secret sauce I’ve discovered after 40+ years in the business and entrepreneurial world. All the successful startups I’ve seen have these five traits in common.
If you don’t get these right, you’ll get frustrated fast. You’ll stay busy but not get much done. You’ll feel like success is just out of reach, or only for “other” people as you watch your dreams slip away a little more every day.
If you want to be a part of the 10% of startups that explode with growth instead of the 90% that fail, you must have these five ingredients. Without them, your chances of failing are 100X greater. (I just made that statistic up, but I really think it’s true.)
#1—Get Comfortable With Risk (It’s the key to breakthrough success)
“Shoot for the moon. Even if you miss, you will land among the stars.” —Norman Vincent Peale
“Whatever you can do, or dream you can, begin it. Boldness has genius, power, and magic in it.” —Johann Wolfgang von Goethe
This should go without saying, but startups are risky. Everyone involved in the company—whether we’re talking about investors, CEO, or the employees—is risking something.
In a successful startup, not only is everyone okay with this, they’re excited by it. High risk can yield high reward.
The reason the risk energizes them is because of reason #2:
#2—Create Contagious Buy-In (Belief drives behavior)
“Customers will never love a company until the employees love it first.” —Simon Sinek, author of Start with Why
If a startup is going to succeed, everyone has to buy into the company’s beliefs. Every single person has to be 100% convinced and committed.
That means the right employees have to be found, hired, and put into place. You as the leader of the business have to instill your company values in each of your employees and partners and investors. Talk about them all the time. They have to be real in your life first, and then others will buy in.
[I’ve created a free step-by-step guide that might be of help here.]
#3—Build Around a Great Idea (Schedule time to think)
“Capital isn’t that important in business. Experience isn’t that important. You can get both of these things. What is important is ideas.” —Harvey S. Firestone
A great idea drives the startup ship. Without a good idea, how will employees buy into the company? How will you convince investors to fund you? How will your startup have an impact on the world?
Great ideas turn into great products. Great products turn into great money.
Without a great idea, your startup is dead in the water.
In the best cases, the product sells itself. That is HUGE when you start talking marketing and advertising strategy.
Before you even start, make your idea the best it possibly can be. You’ll thank yourself later.
#4–Understand What Will Sink You (You can’t dodge what you can’t see)
So you’ve got a great idea, everyone buys into your idea, and each team member is excited by the risk because they know this thing is going to go BIG. Don’t get too cocky yet, because there’s still something that could put a gashing hole right in the hull of your startup ship.
Without great management, everything will sink. Fast.
The employees are the muscle in a startup. They put in the long hours and produce a lot in those hours. But at the end of the day, upper management is the blood, sweat, and tears of a company. It is up to them to get funding, make deals, and create vision. They make the big decisions and guide the company.
“Good management is the art of making problems so interesting and their solutions so constructive that everyone wants to get to work and deal with them.” —Paul Hawken
Who’s on your management team? Are they going to sink you or propel you to the yet-uncharted waters where legends are made?
#5—Master the Art of Communication (Listen as well as you talk)
“Effective communication begins with mutual respect, communication that inspires and encourages others to do their best.” —Zig Ziglar
Too many people forget the basics when they’re trying to achieve something big. Communication skills are crucial in any business, especially a startup where things are bound to change often.
If everyone isn’t on the same page, time will be wasted. People will become disconnected with your company values. And the product—and your profit—will take a hit as a result.
Remember, vision leaks. You have to keep casting it and you must keep the goals front and center for your team.
Make sure YOU are a good communicator. Listen as well as you talk. Be empathetic and clear. And set the example for your management team to do the same.
Break The Statistic Machine
So much has to go right for startups to succeed.
I could go on and on about ingredients for success, but if you get these five down, your startup is going to make it—and make it big.
Do a shabby job on any of them, and it will likely fail.
After all the work a startup takes, you don’t want to be part of those statistics.
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