Phases of establishing a startup
#1 IMPORTANCE OF AN IDEA IN A START-UP
"An idea is like a virus. Resilient, highly contagious. And even the smallest seed of an idea can grow. It can grow to define or destroy you." All industrial and software giants started at some point and at some point, they were nothing but a small idea inside a person's head. Likewise, everything that surrounds you is an expression of an idea, like the clothes you are wearing, the jewellery you have in your hands, the telephone you operate or the car that takes you to different places are some examples of an idea. ‘Google’, itself was nothing but an idea for a website, today it is the most searched website!
An unique idea can lead to the greatest innovation. Although ideas might seem to be a small part of our lives, have the greatest impact. Every product or service that you can think of, are basically an incredible execution was an idea!
It is generally assumed that an idea must be big enough to change the world, but that is what is stopping most of the people from getting to the implementation stage. Every idea, no matter how small or big, contributes something to the world that might be good or bad. Even ‘BookMyShow’, was a very basic idea, thought of while Ashish Hemrajini sat by the beach having a beer. The concept was very basic, people being able to book tickets sitting at home. This seemed to be very absurd at that point. Although, today the company is flourishing and is a multi-million dollar company.
Every entrepreneur, who thinks of any idea wants it to be implemented and see it change the world. Unfortunately, statistics speak the opposite. According to Forbes, 9 out of 10 startups don't survive their 2nd year. If you can do that, feel lucky because you have been able to do something that 90% of new businesses have not! These harsh truth dosage is not intended to discourage entrepreneurs, but to encourage them to work smarter and harder around their problems and emerge as a successful startup! Now, for a growing country like India, ideas create a huge impact on the startups. There are numerous startups that have a unique idea and do quite well with those ideas. Take for example companies like Urban clap which was India’s first online service app. They approached the proper market establishing themselves in 2014 and had a revenue of 116 crores in 2018.
Some duplicate the startups by their own innovative ideas and the innovative way of execution of the same. Basically, adding a USP, Unique Selling Point, which makes the customer buy your product or services over your competitors’. The best example is ‘Swiggy’ and ‘Zomato’ which more or less have the same ideas, but differ in revenue models and overall execution. Hence, the prime moto of any startup should first neutralize on the thought of adapting an idea and giving hundred percent on the other factors as well. Also, one should remember that ideas alone do not compensate on the success of the startup. The product or service doesn’t have to be great, the implementation also plays a major role. The market barely cares how good the team is, as long as the team can produce the viable market!
Now coming back to as to why the 90% startups fail? Do they lack dedication or resources? Or are their ideas are not that capable or extraordinary? Such things should be given a thought before the implementation of ideas. This will only increase the success rate of entrepreneurs. The term used for this is the SWOT analysis. Analyzing your Strengths, Weaknesses, Opportunities and Threats. This gives the entrepreneur an overall view of how well the startup will do in the prevailing market situation.
But also, for entrepreneurs there is no failure, just a lesson to be learnt, an idea that will work with some alterations. In the end, optimism is what counts. The best example to go with is ‘Z.com’. It was an online entertainment company. Over the years, they raised enough money and had an amazing business model, but their broadband penetration was too low in 1999- 2000. Do you remember trying to watch video online back then? It was miserable! It was way complicated back then for even accessing one video. But two years later, YouTube launched a similar platform that would quickly grow into such an immensely popular video sharing website. The problem was solved by Adobe Flash and the penetration quickly crossed 50% in America making YouTube go crazy! In this way it can be clearly stated that you may have a brilliant idea but if the timing considering the market situation and your implementation is off, you are very likely to fall! So, if you think about any idea that might work or is implementable, try pursuing it smartly, think about its cons and a way around it. To become an entrepreneur, one should never be afraid of failure and keep doing with what you think is right. In most cases startups fail because the founders get so stuck on their original ideas that they refuse to innovate and try something new!
Most of us have vague ideas in our mind, forget about the execution for a while. Try to write down every idea in your diary, sit and brainstorm with yourself or your friends. Also only brainstorming is not the answer. Even a simple idea might take you to a long run in future. The overall execution and getting things done at right times plays a major role in the development and growth of the startup. Also, remember the best startups seem like a bad idea, but those are the ones that go on to make billions!