Art of the Start-Up
Partnership building, customer understanding and competitive analysis are just a few of the key factors in creating a successful business.
For those who dream of being the next Steve Jobs or Elon Musk, having a brilliant idea for a new product or technology is just the beginning. Transforming an inspiration into a successful business is another challenge entirely—one that start-ups, all around the world, must deal with.
Luckily, aspiring innovators don’t have to face this often-intimidating world of entrepreneurship alone. “There is so much information available to people who want to be entrepreneurs—books, blogs, podcasts, online resources,” says Donna Harris, co-founder of 1776, a global incubator and seed fund helping start-ups transform different industries. The incubator is based in Washington, D.C., and has offices in New York City, San Francisco, Arlington and Dubai.
For starters, Harris recommends a book called “The Lean Startup” by Eric Ries, a resource which, she says, is especially helpful when it comes to customer discovery—a fundamental process for any new start-up.
Customer discovery refers to figuring out if your idea for a start-up, no matter how innovative and inspired it may be, will actually appeal to a customer base that can make your enterprise grow and thrive. “You won’t know if your big idea is indeed needed, and big enough to warrant starting a company, until you get out and talk to people who have the problem that you think your idea addresses,” says Harris.
Another key element of growing a successful start-up is understanding the competition your company might face. To tackle this topic, entrepreneur Benjamin Levy recommends diving into something called the “Jobs-To-Be-Done Theory.”
“It’s an idea that came from Professor Clayton Christensen [of Harvard Business School], and it’s a great way to think about competitive analysis,” says Levy, who founded the face biometrics security firm IsItYou. “Let’s say that your company makes nails. The truth is, nobody just wants a nail. People want to hang pictures on the wall, for example, and doing so requires a nail and a hammer. If you focus on selling nails just as nails, you’re not meeting the needs of the customer. If you focus on giving them the tools they need to successfully hang pictures, you are.”
“There are countless jobs in the world that need to be done and, as an entrepreneur, you are creating tools or services to do those jobs,” Levy continues. “To start to think about your company’s place in the world, and amidst competition, don’t just think about the nail—think about the job that the nail does.”
Once entrepreneurs can pinpoint the tasks their innovations help accomplish, understanding the competition can easily follow. “Ask yourself, how is the job that you’re trying to help with being done today?” says Levy. “Maybe, it’s only getting done halfway, and other solutions are either too expensive or aren’t doing it well enough. That’s your hole, and that’s where you need to concentrate. Your company is going to try to do something cheaper, better, or both.”
Many successful ventures, both brand new and real-world tested, rely on partnering with other companies and organizations for success. Finding the right partners—whether they help you spread the word about your company or distribute your product, co-manage your inventory or help you obtain the raw materials you need—can be vital for success.
“The key is really understanding your potential partners—what challenges do they have, what’s important to them and so on—and how their needs intersect with your offerings,” says Harris. “The ideal partnership is one where everyone is giving something and getting something. Listening is key.”
Beyond finding partners who can directly help your business, Harris recommends tapping into the bubbling community of global entrepreneurs for knowledge, support and friendship. “When you’re starting a company, don’t go it alone,” she says. “Join a start-up community, hub, incubator or other programs. Entrepreneurship is an experiential activity, and it’s important to surround yourself with people who have already been down the path you’re about to take.”
For all start-ups, Harris recommends a focus on diligent research and preparation. Unfortunately, she says, many young and aspiring entrepreneurs neglect this work. “You should be self-directed enough to find and use the best free resources to get 80 percent of your questions answered. Then go to experts to supplement that,” she says. “Don’t rely on others to do your thinking and work for you.”
Michael Gallant is the founder and chief executive officer of Gallant Music. He lives in New York City.
By Suparna Mukherji
Revathi Roy is the chief executive officer at HeyDeedee, a Mumbai-based start-up which aims to empower and employ underprivileged and low-income women in the service industry. She also pioneered Asia’s first-ever women taxi service, FORSCHE, in 2007, for which she trained more than 1,000 girls to take up the profession. She has three new companies under her belt and envisions training 10,000 women in the next three years and providing them employment in the two-wheeler rider and taxi driving sector. Roy is also an alumna of the 2012 South Asia Women’s Entrepreneurship Symposium, held in Dhaka, Bangladesh, supported by the U.S. Department of State.
Excerpts from an interview.
Please tell us about HeyDeedee.
HeyDeedee is a logistics platform on two-wheelers run by women and girls. It is fundamentally a parcel delivery service.
In your opinion, what are some of the key factors that help create a successful start-up?
One has to have focus and perseverance. The traditional formula is 1,000 days. In Punjabi, there is a saying: the first year is chatti, which means you pay from your pocket; second year is hatti, which means you start easing out; and third year is khatti, which means you can start making money in the business.
How important is forming partnerships for entrepreneurs?
Today’s world and business work on synergies, so growth without partnerships is not possible. Hence, it’s most crucial.
What role does competition play in the entrepreneurial world?
In my opinion, competition should be considered positive. It helps in growing the industry. Our demographics and population only add to the fact the market size is so huge that there’s a slice for everyone.
What are some of the challenges unique to India?
I can talk of my sector, which is skill-building for employability and transport. Both of these are fairly new. So for us, it’s a challenge as a start-up to convince women and girls to take up this profession.
What advice do you have for young Indian entrepreneurs?
Many a times, I ask youngsters, “What’s your idea? What do you want to do?” They answer, “I want to make money.” That is OK, but that’s not an idea. That’s an offshoot of what you will do. So, the idea really has to be something you are passionate about and one which can make a difference.