What Matters In Business For Successful Start-Ups?

by Richard GourlayBusiness mission, Dumfries and Galloway, Innovation, opportunity, start-up advice, Strategy, VisionPosted on Comments are Disabled

What makes a successful company in a market? Is probably the single biggest question a new start-up team must be able to answer. What factors make a successful business has always been a difficult question to answer. So what matters In business for successful start-ups?

The answer has always depended upon who is asking the question!

Unicorn Start-Ups

Dreamers look for unicorns with unique protectable offerings, such as Intellectual Protectable rights, a Unique Selling Proposition (USP).  These dreamers will invest in big step start-ups, market disrupters which will change the markets they wish to operate within. Step changing start-ups such as unicorns (are rare hence the name unicorn), but can reshape markets towards these start-ups. Think about Apple and Amazon and what they have done to the markets they operate within. Today these two are the largest (by value) companies in the world today.  

Unicorns need a unique angle, a technical platform angle, a defendable IP, or a unique (and defendable) operating platform. Even small start-ups can be unicorns if they can identify and control a unique position. Inside Apple’s early technologies was the British made ARM microchip, which propelled it into be a unicorn.  But unicorns are rare, and their window to get established is getting shorter and shorter as competitor awareness and responsiveness is constantly quickening.


Funding Start-Ups 

Traditional funders, such as banks want high returns with low risks, and owners who will take all the risk directly, or being prepared to 100% underwrite the banks so called investment.  Banks do not like, or take risks, which is uncertainty.  Which is why they avoid taking them, unsecured risks are not what banks generally do. So they may support a start-up with a loan based upon a sensible fully costed and robust business plan. 

Banks, who are most start-ups first point of call, often provide a poor place for people to start a conversation with about a business start-up. Start-ups looking for financial support, ideas and how to get a business start-up off the ground often left disappointed by the support which they receive.   

The risk reduction by definition reduces opportunity; in essence if you remove all the risk you also remove all the opportunity a start-up can achieve.  Start-ups often overstate their growth, understate competitor defensive activity and the challenges in getting established. Often start-ups can find better funding through self-funding options, alongside friends and family as stage one seed funding.  It is always best to start small, prove your concept and then go out to market for stage 2 funding with a proven pilot under your belt.  

Start-Up Entrepreneurs Solve Customers Problems

Entrepreneurs genuinely look at solving an emerging problem, the old adage is:-

“The secret of success is to find a need and fill it, to find a hurt and heal it, to find somebody with a problem and offer to help solve it.” – Robert H. Schuller

While the logical approach of bankers is to ride an existing market wave, true entrepreneurs look to create the wave. They are looking at a problem and identifying the ideal innovative solution for that problem’s resolution.

 

Researching Successful Businesses

So what makes a successful business model includes a whole variety of factors including the core idea, the experienced team, the market opportunity, market access, competition, scalability (the list goes on and on, depending upon who you are talking with) and what resonates with key stakeholders and target audiences.

Recently Bill Gross, CEO of Idealab decided to research this using his extensive range of business start-ups; 100 of his own, and matched by another 100, across a whole range of sectors.  His assessment started by analysing what makes successful businesses. He came across 5 key common factors and he cross-referenced those compared to businesses which have succeeded.

Bill Cross’s 5 keys for a successful business include:-

  1. The Idea: defined and coherent.
  2. The Team:  skills, experience, energy and how well connected.
  3. The Business Model:  comprehensive worked through covering the business need.
  4. The Funding – access to the right amount of money to achieve its core goals.
  5. The Timing – identifying the market timing to meet target audience needs.

The research results contradicted what many thought would be the results across the 200 companies he and his team analysed. This survey included global names such as Airbnb, Youtube and LinkedIn amongst the 200. His analysis showed that of all the factors which can affect success or otherwise of a business, success really came down to these few key ones. They key factors which are common across all markets, sectors and over time  are the defining characteristics for a successful business. But of all the factors one stood out throughout the survey.

Success in Business Start-Ups Relies Upon…

Timing is THE common factor in a successful business at 42%. It is the most common trait of successful company start-ups.

Team came in 2nd, with 32% and the Idea only came 3rd in importance with 28%.  The business model, upon which so many advisors focus their attention was 4th at 24% and the funding came in 5th at 14%.

Timing Is Everything for Start-Ups

The quality fo the idea is not as important as timing. Timing, the driving strategic factor can be identified initially through a thorough PESTEL analysis. Timing is the bottomline performance criteria in driving the success factor for a business.  PESTEL factors set the macro landscape a business operates and defines the timing of its launch. If the landscape is favourable then a business can succeed. I not, then even if everything else looks great then your chances are far lower, than if you get your timing right.

This shift from build and they will come, the old motto of every good idea, qualifies that statement by saying if the time is right then if you build it they will come.

What Matters in Business for Start-Up Success is therefore Timing

If you look at all  successful business over time, then it is always timing that matters. Knowing what to do when really matters for leaders to focus on. The world is full of ideas launched at the wrong time. But get your timing right and the world is your oyster.

From the launch of the internet and the creation of Apple, to the development of low cost airplanes to the launch of low cost holidays, timing is everything. 

The Importance of Research for Start-Up Leadership Teams is Vital

Leadership teams need to focus on answering the question their target customers ask, now. Timing is offering the solution the their customers will pay for today, not waiting for it or putting up with second best. If you can answer their needs when they need it, with what they need, then you are on the first rung to find success. Without good timing you are creating products and services no-one (or not enough people want). Timing is equally important for leadership teams to assess if your product / service can be accessed by the target audience.

Successful companies work with their markets to get their timing right in launching products and services that fit within a market. They can challenge existing customers perceptions but they must be the right product at the right time for the right customer if a business is to succeed.

See Bill Gross, CEO of Idealab Ted talk here:-

https://www.ted.com/talks/bill_gross_the_single_biggest_reason_why_startups_succeed

Like to know how Richard Gourlay can support your business to succeed, then contact Richard here or below.

Successful Leaders Plan Their Business

by Richard GourlayBusiness mission, Business Values, Dumfries and Galloway, Exit Strategy, opportunity, Strategy, VisionPosted on Comments are Disabled

Business Planning

Business planning often gets a bad press.  Yet those who do sit down and plan their business are so much more focused, confident, and successful than those who float along with the economic tide. Successful leaders plan their business, so they can focus on leading their team to deliver their plan. Over the past ten years as a strategic planner we’ve worked with hundreds of business owners and seen how those that create a plan and implement it. Those that plan their business do so much better than those owners who try aimlessly lead their business on a wing, a prayer or a dream.  Successful leader’s plan their business, so that everyone knows where they are going what their role is in achieving that success. The way forward in business, clear vision and direction supported by a supportive culture and a clear business plan According the latest BERR report, Small and Medium-sized Enterprises (SME’s) together accounted for 99.9 per cent of all enterprises, 59.8 per cent of private sector employment and 49.0 per cent of private sector turnover. SME’s really do matter to the British economy, and yet they receive little effective support from Government agencies despite being the backbone of the economy, employment, and innovation.

Why Business Leader’s Don’t Plan

“If you don’t make things happen, things will happen to you” Lanes Company Having questioned business owners over the last decade the reasons why owners have not put a plan in place and then executed it, the excuses range from not having the skills, make the time, or have the conviction of their thoughts. Owners know they should have a plan ‘we had one when we first started, but have not looked at it since’ is a common theme. The other is being too busy fire fighting to realise that preventing fires starting, is the best way to not have to fight them. Do business owners not see the value in developing a plan for their business? On the other hand, is the classic perception for business owners that frenetically staying alive is seen as being successful? For many not knowing how to plan is one major reason why people haven’t and don’t plan their business.  Where to start, and how to know what they are trying to achieve immediately puts people of planning.
Faults in Business Planning
Business planning is also often at fault here.  The most common reason new start up businesses create a business plan is to secure funding from banks, that’s when banks did fund business start-ups (now they just offer a high interest mortgage backed by the Government). Therefore, once people have received funding they no longer see the main advantages of planning (and the real advantages are not around money).

Business planning by Richard Gourlay creates a clear path and direction for your business.

Business Planning Skills – Have some GOALS

“The discipline of writing something down is the first step toward making it happen.” – Lee Iacocca Planning takes time, resources, (grey stuff) not the executive trip to some exotic away weekend planning, but some time allocated to review where you are as a business, how your sector and industry are performing and what you want to achieve in the future. Whether it is looking at the next year or planning the next five years, everyone who owns or directs a business is responsible for setting its direction. However, just having a plan in your head, with the classic defence of ‘its flexible at the moment’ is either ducking the responsibility or deluding themselves. The only way to have a plan rather than a dream is to have it written down, turned (if it is not already) into an action plan which is resourced and owned by someone to deliver. Only then do businesses go forward in a deliberate purposeful way. Only then do the right things happen because you made them happen and only then can everyone, employees, shareholders, customers, channel partners and even other halves, see your dream, share your dream, deliver your dream. That’s when planning works. It is a written document, which lives within your company, and it doesn’t matter if you are a one-man (woman) band or running a multi-national Plc.

What Business Planning Delivers

A clear business plan is the result of a process. It starts with thinking, then writing it down. That commitment itself is a sense-check, it creates a reality and makes the writer accountable for their thoughts. By writing down your business plan a leader takes a dream and begins to make it a reality. Others can see, critically evaluate, and judge the business idea and review the opportunity the plan intends to address. By doing this a business idea is viewed in the round, looking not only at the idea, but the actuality of what needs ot happen across all busienss area functions to turn the idea into reality.
“In the absence of clearly-defined goals, we become strangely loyal to performing daily trivia until ultimately we become enslaved by it.” – Robert Heinlein
business planning, business plan, the elements of a business model Planning provides focus in strategic direction.  It provides clarity of where the business is and where it is going as well as a vehicle for getting from where you are to where you want to be. Planning time out of the business provides time to reflect on personal and corporate goals, time to share and channel new ideas while reviewing existing activities. Planning in a structured and open format develops clarity of purpose and a clear understanding of the organisational and individual skills people have and can use to leverage advantage. Bringing in outside views widens the planning horizon, a fresh perspective to drive businesses forward. This is why many successful businesses use non-executive directors or outside specialists to help drive their business forward. That is one reason why so many people volunteer to get support from people like the Dragons from Dragon’s Den, they are looking for expertise and advice which gives them confidence to go forward as much as the money.
Plan More For Success
British business owners need to plan more often to keep being successful. Good planning creates and sees opportunities as owners and directors lift their heads up from the daily grindstone. How often should you plan? Well it all depends on the speed of your market’s evolution, but even stable and stagnant businesses should review their business every year, and not just a light dusting (add ten percent and change the year) but strategically review what and how well they are doing. It is only by looking for fresh opportunities and how to take best advantage of them, by planning your business around those opportunities, that companies successfully compete in today’s business environment.

Business Planning is not a four letter word

“An organization’s ability to learn, and translate that learning into action rapidly, is the ultimate competitive advantage” Jack Welch

The old adage, compete or get beat, is more relevant today than it has ever been. The rise of the Internet means there are no secrets, competitive advantage lies with those who can see an opportunity and adapt fastest to take advantage of it. Those owners and directors who see and go for opportunities become the stronger ones.  That is where good strategic business planning provides it real advantage. That’s why successful leaders plan their business to achieve that success. By orientating a company to where it can retain better, win new and develop existing customers companies that plan their success out compete in their sector, and equally importantly have everyone focused on where they are going. From the smallest to the biggest every business needs to have a plan that is written down, owned and guiding your business in the direction you want it to go. Good Luck
Richard Gourlay
@richardgourlay www.cowdenconsulting.com
The way forward in business, clear vision and direction supported by a supportive culture and a clear business plan, by Richard Gourlay

Content Strategy: The future of marketing

by Richard GourlayBusiness culture, competitive advantage, content strategy marketing, Innovation, Marketing, opportunity, StrategyPosted on Comments are Disabled

In a world of continual change seeing what is happening is often difficult to understand until the paradigm shift has occurred. Many companies are struggling to stay ahead or even in the game of online marketing. Many companies are moving towards online marketing content strategy or as marketing people call it inbound marketing. This major shift in culture and one needs to be fully understood. The importance of content as a strategy is the future of marketing.

Content Matters

I have just had an old-fashioned marketing communication from a well-known brand, asking me to make an immediate purchase offering me a FREE upgrade for a new phone. My automatic response is not to be interested, at all because they have not demonstrated that they understand my specific needs. That made me thinks and write this article to explain why in today’s online world that old marketing technique is now as un-effective as a double glazing salesman offering me 50% off! 

Content Strategy: It’s a complete shift not just an add-on

In a world where everyone is online all the time, the amount of information is drowning people, from Linkedin to Facebook and Twitter the rise of smart phone connectivity has promised much change to marketing but until recently only early adopters, high value and niche players could see what it meant to the marketing process.
Like many changes, it is not until the change becomes tangible does its impact become visual to many marketing departments that enables them to successfully influence a company’s marketing policy. This is considerably harder to convey when there is no tangible evidence of marketing results attributable to hard to track invisible marketing shift. Unlike the shift to direct marketing where direct connectivity between outcome and result can be seen through a transparent return on investment, online inbound marketing is struggling to demonstrate its effectiveness.

Content Marketing: Pace of change is outstripping current understanding

Currently content marketing relies heavily upon invisible and poorly understood online activities. Simply put, the rate of change is outstripping the knowledge base of the marketing industry, creating a gap between the understandings of marketing by decision makers. The routes causes of this is that not only are customers sourcing information in newer ways but the platform they are using, the Internet indexing is also changing ever faster, Goggle will make over 600 changes to way it scores content. Rapidly changing customer preferences, coupled with changing technologies and an ever changing platform results in the lack of certainty of what is working and why. By the time you’ve worked out what works it has already changed.
Content Strategy can create confusion.   
Content strategy marketing process, one that now focuses on creating online and open platform engagement, online PULL; rather than internally controlled PUSH marketing methods, traditional marketers often struggle to understand the process let alone feel uncomfortable with the concept. This is not unreasonable, given the history of marketing in the last 50 years has always focused on the traditional pipeline of generating and then controlling customer decision-making, content marketing turns that on its head. People investing in inbound marketing are asked to spend money on losing control of the potential customer by letting them make an open decision about how and when they engage with your brand.
In the mid 1990’s I remember designing a website to support a brand. No one was interested until it was live and people could see something online. A director then said, “That’s great let’s print it off and send it to all our customers”    

Dialogue NOT monologue

The inbound marketing process is about generating an open dialogue, rather than a structured marketing process. It lets potentials, prospects and suspects move in and out of your control while they select you, rather than being controlled by you.
The Content Strategy Process
  1. Listening – Online is now the first port of call for 78% of web users.
  2. Creating – Great content that answers need and demonstrates expertise.
  3. Engaging – Is about being talked about and developing a dialogue with audiences
  4. Transforming – Is about continual engagement, moving them from suspects to purchasers
  5. Growing – Requires creating perpetual momentum developing new and developing loyalty
Traditional marketing models of developing engagement such as AIDA are still highly valid but instead of just focusing on a immediate winning proposition through a grabbing hook, attach a liner and sink them in a simple linear model for winning customers. Content strategy marketing demands  multiple engagement tools which include cross referencing other parties creating competitive collaborative working to generate awareness, giving away FREE content in white papers coupled with fast and slow acquisition tools in decision making.
Content strategy needs to be explained better
Moving to a content strategy is about moving from PUSH to PULL, not about the Internet platform, it is about understanding the importance of open unrestricted dialogue rather than material generation and in reality it is not just about the Internet although this is where its impact is being seen today, but equally will encompass every marketing platform and process. The growth of mobile technology will further the pace and realisation of content strategy.
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Leadership in business is a challenge we can help with.

Have you felt the full power of the Internet Tsunami Yet?

by Richard GourlayBusiness Identity, competitive advantage, content strategy marketing, Innovation, Marketing, opportunity, VisionPosted on Comments are Disabled
Has the world moved for you, or did you miss it? The world of business has shifted but many businesses don’t seem to have noticed the great shift in power away from companies to the customer. The internet is not a fixed service, it is growing and evolving rapidly and with it so are the tools and uses it delivers. What was once a way to replace your Yellow Pages has become the most powerful source of information the world has ever seen.  Have you felt the full power of the internet tsunami yet?
We all see the impact of the Internet in every market sector.  We see the growth of online shopping or the growth of smart phones and the online move of insurance and music online.  That shift and the corresponding growths of new consumers are just beginning to be understood, this is just the proverbial tip of the iceberg. The next stage of the internet revolution has yet to be felt.

The Great Paradigm Shift: Internet Tsunami

As our understanding of this shifting paradigm slowly emerges and evolves.  It takes time for its impact to be fully understood and its impacts to be really appreciated. In the same way as the impact of the introduction of domestic electricity which subsequently facilitated the introduction of the radio, which spread communication did in previous generations. So the rise in power of the Internet is more than just our ability to look stuff up and buy consumer goods online.
This paradigm shift has certain key features, which makes the rise of the Internet generation far more dramatic in its impact to business today.
Unlike many previous innovations, the move online has been done in an infinitely scalable way.  Making markets financially accessible to company’s of any size and dimension using low cost everyday technology. The whole plethora of internet software platforms provide total engagement opportunities for businesses to reach specialist or global markets. Rather than being a premium service only open to the super rich, such as the introduction of the car, airline or a global consumer product range. A good idea, service or product can now be provided through the internet instantly. The availability of multiple open software technology platforms, has lowered cost and created universal access by braking down barriers across all areas of a global market.

The Internet is a Global Movement

This global shift, supported by governments and industry to reach and penetrate all and every strata of society and on an almost global reach is a new global phenomenon creating a universal shift.
Whether in New Guinea or Newfoundland, you can get a 3G signal.  Many countries like India and China just leapfrogged the copper wire landline systems of the 20th century through large parts of their country’s moving straight into the 21st century, avoiding unnecessary cost and rapidly accelerating progress throughout their country.  The Arab spring was not achieved by any three letter acronym news agency or Rupert Murdock’s media empire, but by new young mobile online generation who created, sustained and drove the rolling revolutions.

The POWER of the Internet Tsunami

The result of the internet revolution is that the world has made a huge step forward almost overnight.  That has changed more than just the way we buy some products, it has in fact changed the way we think, and act.  This universal overnight movement has also solved the adoption dilemma for new technology.  For companies to achieve a launch of a new product or service they had to achieve a critical volume and this can now be achieved without geographic boundaries.  The internet creates multiple new routes to market, bypassing traditional routes to market, achieving profit without having to invest huge amounts of capital in awareness marketing.
The sign you've been looking for that values matter in business

Internet Empowered Intelligence

This paradigm shift has moved the way we think to such an extent that everything has changed. When in 1906 Admiral Sir John Fisher invented the Dreadnought battleship in 1906, he changed naval world overnight. At the time the Royal navy had 1,000 ships of the line, the introduction of the Dreadnought made them all redundant overnight. Suddenly, to be a superpower it was not the number of ships you had but how many Dreadnoughts you had and a new arms race had begun as every other battleship become redundant.
In the same way, the introduction of always available high speed broadband has made so much of business thinking redundant, not just in the collapse of use of directories such as yellow pages, dictionaries or our communication. Today people have empowered intelligence, the ability to become informed by scanning a QR code, or connecting to a highly rated source they can become more than informed, they can become actively empowered.

Internet Tsunami Continually Evolves 

The internet is now driving people to think and do things in different ways across many age and economic cohorts. Its not just the young buying music or consumers doing their shopping online, although both have delivered huge shifts in culture to these markets.  People’s first mental response to knowledge and decision making is now to click, look-up and become informed.
No-longer relying on our embedded historical mental heritage or through experts’ advice, people are now researching and networking their knowledge and our learning, widening knowledge and creating expert communities on almost every subject matter possible. For example to become an expert on social media you could do an online course or you could click onto Mashable and become an expert within hours. Anyone and everyone can become an expert, exposing consumer and business choice to new forces and opportunities.
You may have heard the old adage that there is more computer power in a simple watch today than on the Apollo 11 spacecraft which took man to the moon. People have at their finger tips more knowledge about companies than even the most informed company is aware off. Users groups, expert forums and review sites empower and drive decisions, in a far more effective way than traditional marketing channels can persuade customers.
In just in the same way that the Arctic Monkeys pioneered the music online community following, rather than through the plugging and playlist approval to get on the radio. Today the same today is true of consumer both in consumer and business markets.
The power of the internet is yet to be fully understood. For some it has been like a Tsunami, just as a record shop or an insurance salesman. To many others though it is an unseen force, they know its there but not what or how it operates and effects their business. But it is and it will. The sooner business wakes up to these changes the better placed they will be to compete without feeling they have one hand behind their back.