Why curiosity killed the cat?
How many startups are there? This question drove me to think about what makes a young company successful and how to maximize the chances. This post may be relevant if for some reason you can't make it to the mainstream market (go live) and you feel that your business is stuck a bit.
Image by Marco Schroeder
According to the reports, 305 million startups were created globally in 2022. 1.35 million in technology.1 On average, only 10% will survive and will become enterprises, understood as profitable businesses.2 The reports also show the main reasons for failure (post-mortem-based) and name, among others, the following:
- no market need,
- run out of cash,
- get outcompeted,
- poor product,
- lose focus,
- lack passion.
Besides the very first one - no market need - which is a no-brainer, all of the following reminds me of the famous quote3 on the (in-)famous chasm between early and mainstream markets:
To enter the mainstream market is an act of aggression. The companies who have already established relationships with your target customer will resent your intrusion and do everything they can to shut you out.
Geoffrey Moore, Crossing the Chasm
Startups, often funded by engineers who are passionate about technology, forget that being successful doesn't mean winning in all fields with the strongest competitors. What they built in years most probably can't be beaten immediately by a young company. Therefore it is crucial to silence the inner critic telling you that the product isn't complete or that there are superior tools that can do the same. Find your top feature or features (just a few!) that deliver value, and make them good enough to win first customers.
This will be your stronghold (using Moore's term) on your way to future successes and over time may lead you to great victories. Even against the big players of today.
Staying focused is in my eyes crucial as it helps to address all of the reasons for failure listed above:
- no market need - at least you will find it out quickly,
- run out of cash - before it happens you should be in the market and have some traction, even if you will need to get an investor, it should be much easier,
- get outcompeted - a few, top-notch features are better than lots of poor ones,
- poor product - same as above,
- lose focus - simply won't happen,
- lack passion - it's much easier to keep it having visible improvement and progress.
On the flip side, being curious is vital. It opens you up to new possibilities and allows you to get surprising results. All you need to do is avoid going too far with experimenting and in turn, having a wide variety of so-so features that nobody is willing to use.
Have you ever had issues with focus in your startup? Share your thoughts in the comments!