In today’s day and age, it’s not enough to adhere to the old adage of “build it and they will come.” Firstly, if no one knows what you built, they can’t become a customer of your startup.
Secondly, your job is not finished once you have incorporated a startup company. Instead, there is more global competition for your startup than ever before.
When you combine that with the rapid evolution of technology, it becomes clear why you need a plan for continuous growth. If you don’t continue to improve on all fronts of your business, competitors will be looking to take your place.
Therefore, in this article, we will discuss various ways to prepare your startup to grow, not just now, but continuously, into the future.
That way, you can boost your revenue, your equity, and your chances for ongoing success in a crowded startup world.
Let’s jump in!
9 Essential Stops On The Road To Startup Growth
- Understanding Your Market
- Idea Validation
- Investors and Funding
- Your First 5
- Lean Testing and Iteration
- Medium Stage Growth
- Late Stage Scaling and IPOs
- Customer Feedback
1. Understanding Your Market
You have the best business idea and build the most amazing product in the world according to your internal team. However, if there is no hungry market ready to purchase or use your products and services, it won’t matter.
That is why the first step in setting up your startup for continuous growth is to know your market on a deeper level than anyone else does in your industry.
One such strategy to achieve this is via a customer “avatar”.
This is a representation of your typical ideal customer or user. For instance, you’ll want information on the following areas:
- Marital Status
- City / Location
- Interests / Affinities
- Previous Purchasing Habits
- Problems / Frustrations
Of course, this is just a start.
Once you create the initial avatar, you need to constantly revisit it to keep your avatar updated with market changes.
2. Idea Validation
Once you have a market in mind thanks to your avatar, and you have an idea of what kind of product you want to provide for them, you still need to make sure that your predictions are correct.
This is where the stage of idea validation comes into play.
One of the core tenets of lean startups is to validate your ideas early and often. This involves creating something called an MVP (Minimum Viable Product).
In essence, your MVP is the most bare-bones version of your final product that still works and serves your users’ needs.
Instead of taking the time and money to build out 10, 15, or 20 features, you should focus on a small handful that deliver results.
From here, you can see how your market responds. This approach allows you to make key changes early on, rather than waiting after you’ve invested heavily in development and other costs.
That way, you have more cash to invest in future continuous growth.
3. Investors and Funding
Once you have hammered down your ideal customers and proven that you have a product or market fit for the early iterations of your startup, you are in a much better position to attract funding.
Funding is essential for early-stage startups because you are up against others who are receiving large amounts already from various investors and venture capital firms.
The primary thing that investors want to see is a proven market and a product that serves them.
From here, you can cater your pitch deck to explain your unique vision, how it fits in the industry, and the opportunity to grow rapidly — therein delivering a large return to your investors for their upfront risk.
4. Your First 5
Your team—the employees within your startup—are the lifeblood of your business. There is a concept in the startup world called the “first 5” for this reason.
Essentially, the first 5 people you hire make a monumental difference in your ability to grow your company.
In a way, the first 5 employees that you have will determine the next 10, 20 and even 100 employees that you hire.
They are a showcase of the kind of team members that you expect and allow in your organization.
At a minimum, you’ll want great designers, programmers, marketers, and managers.
It is common to promote from within, so these first hires should be individuals who you would feel comfortable putting into management positions as your company expands.
5. Lean Testing and Iteration
The first version of your startup’s product or service will not be the final one. Instead, you need to be constantly testing your product and revising it.
Otherwise, you risk becoming boring, out of touch, or simply having too many bugs to count.
So if you want your company to continue to improve over a longer timeline, testing and iteration should be part of your organizational DNA.
Adhere to regular testing and iteration periods where you review your results, your errors, and implement changes to improve what you’re offering to the market.
6. Medium Stage Growth
Once you have established traction and iterated a number of versions of your startup’s product, you are probably in what is called the “medium stage” of a startup.
You have plenty of users, and you have a reputation within the market. Now, your job is to grow in other fashions.
For instance, you might look to acquire a smaller company or bring on top talent, even if they are overpaid—since your revenue or investment resources allow you that luxury.
Be careful not to rest on your laurels at this stage. You still need growth because your competitors will be looking to do the same. If they find innovative solutions before you do, you can still lose market share.
7. Late Stage Scaling and IPOs
There is a certain point you can reach within your company’s journey where you need to grow in an exponential way.
Otherwise, you will be stuck in linear growth models, which don’t always sustain profits after you take into account all the expenses you incur as your company grows.
In order to counteract this, there are some ways to scale your revenue, or at least your equity.
One of the most used ways to grow once you are a late-stage startup is to use an IPO (Initial Public Offering).
This is where you take your company public and allow a lot of new shareholders to purchase equity, dividends, and other rights within your company.
Keep in mind that you can grow your revenue without necessarily giving up voting rights, making it an attractive option.
However, some entrepreneurs prefer to maintain full control and privacy over their companies.
Various governmental organizations may want to have you keep records once you reach a certain level of public notoriety—an important factor to consider, because lawsuits tend to be filed against well-known brands for frivolous reasons.
This article wouldn’t be complete without a final note on security. Keeping your software development secure with the best practices has never been more important than it is today.
If you allow some kind of data leak to occur within your startup, you will lose all the trust that your market had in you.
Therefore, ensure that you implement firewalls, two-factor authentication, and other security measures within your team to maintain data safety.
9. Customer Feedback
There is a certain comfort in using pure numbers to judge the success of your startup. They are impersonal, exact, and cold.
However, to keep a true pulse on how successfully your company is solving your market’s problems, you need to ask your customers straight up.
Customer feedback can come in various forms, all of which offer different advantages. For instance:
- Email Surveys – Email is certainly not dead. In fact, it is a valuable tool for startups to reach out to their verified customers and solicit feedback on various aspects of the business.
- Phone Calls – There are few things more personal these days than a direct phone call. It shows that you are putting that personal touch on your outreach, which can win you new customers for life.
- Forms After Purchases – On your website or app, simply create a form or popup after the purchase is complete. This can allow customers or users to tell you about their experience.
By getting feedback from your market using the methods above, you can find out what parts of your company you need to improve in order to maintain your upward growth curve.
If you want to achieve your business and personal financial objectives, then you need to have the right strategies in order to navigate the modern business world.
Otherwise, you risk missing out on crucial opportunities.
Many startups make the fatal mistake of focusing too much on shortsighted goals or specific technologies instead of the overall trends and higher-level concepts of their industry.
Therefore, if you use the tips above to grasp the methods to foster continuous growth, you can gain a decisive advantage over your competitors.
So, select a handful of the steps above that are most relevant to your startup planning right now.
That way, when you start your venture you will be equipped with the knowledge and confidence to dominate your market and provide more value for your end-users.
Author: Michelle Laurey
Works as a VA for small businesses. She loves talking business, and productivity, and share her experience with others. Outside her keyboard, she spends time with her Kindle library or binge-watching Billions. Her superpower? Vinyasa flow!
Twitter | LinkedIn