Whether you are starting a new business, trying to take an existing side hustle or company to new heights, or simply looking to boost your career, you can benefit from adopting some of the characteristics of a startup. Startups are resilient, innovative and adaptable – traits that are valuable for any person or organisation in today’s fast-paced, digital business environment.
Before we jump into the topic, let’s clarify the difference between a typical small business and a startup. Startups are usually founded to drive rapid, top-line growth and scale up into national or even international businesses. The intention is often to change the way an entire market or industry operates, in many cases by using new business models, technologies and processes. And the most successful ones deliver products and services that dramatically improve our lives.
These lofty ambitions set startups apart from small enterprises that aim to achieve stable revenues and profits, usually with a view of serving a local market. In many cases, the business owner is content to remain small and sustainable. In that context, it would be remiss not to point out that the failure rate of startups is high and there are thousands of struggling or defunct companies most people have never heard of for every Uber, WhatsApp, or Tesla.
Still, there are many useful lessons to take from successful startups and how they navigate a complex, constantly change world.
Let’s take a closer look at the mindset and DNA of a successful startup.
- Embrace change.
- Take calculated risks.
- Be flexible and move fast.
- Run lean.
- Learn from failure.
- Have a vision for making customers’ lives better.
1. Embrace change
Technology, regulations, consumer tastes, demographics, and the social landscape are changing fast. It has, for example, taken less than 20 years for the web to transform how we shop, bank and work, and innovations such as social media and smartphones have only been a big part of our lives for 10 or 12 years.
Small businesses need to embrace change to remain relevant in this environment. If you are in hospitality, trends like plant-based diets are reshaping your sector at an astonishing speed. Financial advisors are finding that generations Y and Z think differently about money. Rather than fearing these changes in age-old markets, businesses with a startup mindset will seek to find opportunity in these trends.
2. Take calculated risks
Startups look to get big payoffs from calculated risks. Your small business could also reap some rewards from challenging the status quo. There are many ways to shake things up a bit.
For example, you could bet on a new supplier for your restaurant or dip your toe into a new market by adding a new style of cuisine to the menu. Or you could try hiring a freelance marketer from outside your industry for new perspectives on the business. The key here is that the risks are calculated – you should do the due diligence and know what’s at stake before committing.
3. Be flexible and move fast
We’re living in a world where speed wins over perfection, with a few exceptions. Startups cope in this environment by rapidly developing, prototyping and iterating their products, using methodologies and concepts like agile, design thinking and minimum viable product (MVP). Delivering new products, services and ideas to market quickly helps them to learn what customers want and rapidly learn and improve.
The lesson here is that it can be good to get to market with your new ideas and products before someone else does, and rapidly improve it based on user feedback. If you spend months perfecting your new offering, you could find that it’s no longer relevant by the time you come to market or that someone else has beaten you to the punch.
4. Run lean
Tech startups usually don’t try to reinvent the wheel, leverage off resources and capabilities that already exist in the market. For example, they will usually use cloud services and open-source software to build their own product rather than trying to build from scratch and do everything themselves.
Small businesses can also benefit from this approach – for example, you could use a co-work facility for office space to save money instead of renting a full office of your own. Instead of building a website from scratch, you can use a solution like GoDaddy’s Website Builder or a template on a content management system like WordPress.
5. Learn from failure
Failure is a part and parcel of a start-up’s existence. In fact, failed brand campaigns, product launches and feature updates happen in every company’s lifecycle, irrespective of its industry or size. But what makes startups different is that they accept that failure is an inevitable outcome of experimentation and innovation. And they see it as a learning experience.
Rather than becoming despondent or pointing fingers, successful startups will analyse a failure to see where their assumptions or their execution were flawed. It’s a good principle to adopt in your small business, too. Rather than beat yourself up when you’ve lost a major account, failed to convince the dream salesperson to join, or mispriced a product, ask what the lessons are and how you can do better next time.
6. Have a vision for making customers’ lives better
The most successful businesses in the world are usually fuelled by purpose. They are curious about their customers’ problems and they are passionate about making life better for the people or businesses they serve. They are customer-centric, constantly asking how they and no one else can engage the customer and deliver something that makes a real difference.
Every small business can emulate this example. You can use a range of tools – from surveys to web analytics to face to face chats – to understand your customers’ needs. Constantly seeking customer perspectives is a great way to build a successful business.
Lessons from startups
Adopting some of the ideas and characteristics of a startup can help you to thrive in a complex world. Customer-centricity, flexibility, resilience and tolerance for calculated risk can all give you an edge as you grow your business. Whether you want to change the world or make the best coffee in the neighbourhood, thinking like a startup can help you to thrive.