Over the recent years, there has been significant growth in the start-up market all across the world. But what does it take to create the next billion-dollar empire, especially when you’re starting small? We explored some factors that can make or break a promising business idea.
The United States is home to 70,762 start-ups, leading the world’s start-up market. Out of which 69% start at home. The world of start-ups has seen a significant boom over the last few decades. With inspiring success stories coming out every day, more and more people, not just in America but across the world are taking the leap towards creating a unicorn.
In fact, January 2020 saw the highest number of internet searches for “how to start a business”. But what really happens when a business starts? Is it just someone in their garage doing their own thing? Small businesses and start-ups have been reported to be hiring in large numbers. Despite the pandemic where we saw a large number of job losses in big corporations, small businesses have reported a historically high number of job opportunities in 2020. This makes the start-up culture a great thing for not just the founders and business owners but the economy in general. The model has been driving growth in terms of money, technology, infrastructure, and innovation across the world.
The world is full of success stories where backyard businesses became globally profitable ones. The world’s most valuable start-up company, ANT Financials is valued at $150 Billion. So, can anyone do it?
So far, we've established that there is no dearth of big dreamers who are ready with a startup idea and the zeal to take it to successful heights. However, out of the 70,762 start-ups that currently exist in the US, only 50% are likely to survive beyond 5 years. As we’ve discovered, over the last several years, the start-up market has become a rather competitive one. While new ideas and ventures are budding every second, the investors and the consumers are still only as many. This means that a lot of the new entrants need to constantly fight for attention from either bigger investor firms, businesses, or customers. Add to that the limited resources and scale of a new business, it’s no easy task. Bureau of Labour Statistics indicates that the first year is the most crucial one for any new business, especially the ones that are employers.
Creating a successful business has never been a cakewalk, but it has become increasingly difficult in the competitive climate of today, where attention spans are low and expectations are high.
So, let’s take a peek into what goes on behind the scenes. Genius can strike anytime and you could be sitting on a billion-dollar idea but that’s only where the strenuous journey begins. Since a majority percentage of people start their businesses from home, it’s no secret that more often than not, the founders are spread quite thin. Their designations can range from from an intern to the chief operations officer all at once. From fetching coffee to cracking the big deal, the work is stretched out in every direction but only has attention from a limited bunch of people.
One of the most crucial tasks that owners and their teams find consuming their time is finding the right kind of support in terms of service providers and vendors.This part of the business is truly a conundrum. While it’s a task that keeps them away from other much more valuable things that could lead to the growth of the company, tying up with the wrong service providers can cost the business a whole lot in the long run.
A new business requires a lot more than an established long-running one. With every aspect of the business starting from scratch, it needs to look for multiple partners it can rely on for multiple roles. Depending on the nature of the business it could be in need of anything from recruitment services to software services.
The top three industries that see a surge of start ups are Fintech at 7.1%, Life Sciences & Healthcare at 6.8%, and Artificial Intelligence at 5%. Understandably, reliable SaaS products are something that a lot of start-ups require as a starting point for growth. Whereas any startups operating on a B2C or D2C model will need assistance and services from CRM professionals or payments and transaction services.
While the success stories make it to every home, a much larger number of the failure stories are seldom read or seen. Behind the glitz and glamour of the start-up world and the potential of a multi-billion dollar unicorn, there are some harsh realities.
One of the major reasons behind the exponential number of failed start-ups has been an inability to correctly gauge and provide for the market. One of the most essential parts of a business is to understand the problem you’re trying to solve and create a service or a product designed accurately for it. This journey is not just one that requires effort but also a huge amount of time and attention from the teams. Something that’s hard to get around when a chunk of your time is consumed in researching, finding, and trying to appoint the right vendors and service providers.
Another major reason behind the high failure rate is the poor management tools. A lack of structures and reliable management tools for internal and external purposes can result in chaos in no time. With multiple tasks and responsibilities at the hands of key stakeholders in any new business, it gets harder and harder to keep track of things, and before you know it you have lost track of crucial stuff that can make or break a business. With these logistics occupying a major part of the time, start-ups find it very hard to focus on the reason they started the business in the first place.
So far we’ve learned that the start-up world is an overcrowded and competitive one. Potential unicorns often find themselves caught up in the complications of looking for or coordinating with vendors and service providers and fail to pay attention to growing their business, making fresh pitches, focusing on problem-solving and developing solutions to meet market needs.
So, what’s the solution?
Well, one way of ensuring success is to take the competition and turn it around into an advantage. By replicating reliable vendors that competitors are using, businesses can save their energy to focus on more important things.
With solutions like GetProven that systematically curate and manage your vendor and service provider requirements, the business owners and teams can significantly cut down the time and effort they had previously been allocating to vendor management.
However, it’s more than simply saving time. GetProven curates and manages all your interactions with third parties to minimize costs by creating a healthy competitive spirit among vendors. By getting listed alongside others, every vendor strives to deliver their best quality and price. All that the start-ups must do is simply replicate what their successful peers have been going for.
When this large area of business management does not need constant engagement, start-ups can really focus on agendas their growth and success really rely on. In addition to that when they get access to peer vetted and reliable vendors they know their business is in safe hands and certain aspects of the business are off their busy hands.