While a lot of people are surprised by the fact that 9 out of 10 startups fail within the first five years of running, those who have actually tried to launch a startup are not at all shocked by this statistic. After all, the odds are stacked against you and you are required to fight an uphill battle from day one.
All your competitors already have a business infrastructure, a network of contacts, return customers and in most cases, even more money than you do. When you put it that way, even that 1 out of 10 success rate may even seem a bit high.
Still, with the right plan, your business can easily survive its first year as a startup and thrive. Here are several tips to help you pull this off.
#1. Set the Right Short-Term Goals
As soon as the idea is spawned in your head, you have all the necessary long-term goals in mind. You have at least a vague sense of what kind of company you want to run in 10 years’ time, which markets you want to dominate and even where you will go from there. On the other hand, if someone asked you about your goals for the next week or month, you might lack an adequate answer.
Think of your long-term goal as a long journey, with every step of the way being a single short-term goal. For instance, you could set an increase in a number of people who visit your website as one goal and an increase in your weekly revenue as the next one. These objectives can be quite arbitrary as long as their long-term effect is the achievement of your end goals.
#2. A Good Hiring Policy Determines Your Efficiency
Numerous surveys claim that a happy employee works 12 percent better. Furthermore, various scientists argue that the temperature, noise levels in the room and even visual distractions all affect the productivity of your team.
However, you need to keep in mind that the personality, background and training of the person you hire represent a foundation for their future performance.
Some people are simply better suited for both the job at hand and your company at large. It is your task as leader to pick these people wisely and place them in a position where they can unleash their full potential.
#3. Be Persistent
Probably the most important thing about surviving the first year as a startup, that no one ever tells you about, is that you will spend a lot of time working at a loss. In fact, for most companies, it takes anywhere between 6 and 18 months to become fully self-sustainable.
With this in mind, the worst thing you could do is give up at the first bump you encounter, seeing as how you will then never find out if your company actually had a future. Even a major inconvenience, like a bad publicity hit, isn’t the end of the line, which can be seen from the example where Youi NZ boosts jobs after a rough patch it encountered right after its launch.
#4. Prepare for Success
In the introduction, we mentioned that over 90 percent of all startups eventually fail, which is why a lot of inexperienced entrepreneurs prepare for the worst, but not for the best-case scenario. In their minds, once their company sets off on the right path, all else is a walk in the park. Unfortunately, this is not always so.
It is quite easy for someone new to the market to mistake a fluke for actual growth and start overinvesting in order to expand their capacity. In the grand scheme of things, this can draw away some of the resources which could definitely be put to better use. This is why you always need to approach success with caution and a plan.
By marking your course every step of the way, hiring the right people, preparing for any outcome and simply refusing to give up, you significantly increase your chances of making it. After this first year, you will not only have your roots planted more firmly into the ground, but also gain a lot of industry-specific experience that will make your job of leading the company much easier.
In other words, while your company still won’t be completely out of the woods, your chances of staying afloat will increase drastically.