Start-Ups with Purpose: A recipe for success

By Peter Damon

“Chase the vision, not the money. The money will end up following you.”

-Tony Hsieh, Zappos CEO

Most start-ups materialize through inventiveness. Someone has created a new or better mousetrap, the entire start-up organization is enthralled with its innovation and discovery and wants to stand up and scream at the world, “Look at us, look at what we do!” Which by the way is totally cool and fundamental to a good brand story. But a huge mistake that many start-ups make is to stop there.

When it comes to start-ups, the “What” is not nearly as important as the “Why”. The idea that births a start-up (the “What”) has a short shelf life. It’s where you go from there (the “Why”) that determines your level of success.

When you focus on the Why, you’re asking yourself the big questions: Why do we do what we do? Why should anyone care? Why is what we’re doing going to impact the world? And how do we articulate that to those who matter (employees, customers and investors)?

Here are 3 start-ups that got it right – and 3 that need to find their North Star:

Spot On:

Uber – “Evolving the way the world moves”

Uber’s recent startling valuation is a direct reflection of not what they are doing, but where they are going. A company offering vehicles for hire and ridesharing services is nothing new – but that’s just the short-sighted what. Uber is “evolving the way the world moves” – and according to investors that’s the big idea.

GoPro – “Helps people capture and share their lives most meaningful experiences with others – to celebrate them together.”

B2B stories vs. B2C stories are irrelevant here, as customers choose brands the same way in both worlds – emotionally. For GoPro, the north star of Why comes across in key touchpoints of your brand experience – from who they partner with (RedBull and extreme sports) to the products they make (their new ‘Fetch’ camera mount came as a direct result of what their camera users seemed to want to share).

Oscar Health – “Make insurance simple, intuitive and human”

Like most people in the US, the founders of Oscar Healthcare recognize that the system is broken. With every touch point, the employees of Oscar strive to create the sort of health insurance experience that they themselves want. Refusing to be constricted by what historically is or isn’t a part of the health insurance experience.

Works in Progress:

Snapchat– “Sharing your point of view”

Snapchat claims they are about “sharing your point of view”, however the perceived story of Snapchat is self-destructing messages and media teens can send without their parents seeing it . While they’ve had success up until this point, without a clear north star, they’ve got a lot of people saying – what now? Can anyone say ‘one hit wonder’?

Birdi – “Better than a smoke detector”

Cool looking product that seems to have a lot of engineering marvel at. But why? It’s all about what they do now and creating a better Nest – but what happens when investors pose the question, “And then???”

Lyft – “Ride by ride, we’re changing the way our world works”

On their jobs page they have a great overview of the way the world could be. Using transportation and tech to make cities feel small again – but the experience for both employees and users seems to take away from this. They want to have a ‘community-driven’ future, but all the focus is on what they do, not why. They will likely grow with the sector, but clearly, articulating and communicating Why has given Uber a quantifiable advantage, demonstrated in revenues and valuation — $18B vs. $3.5B.

Getting to Why isn’t easy. It has to balance aspiration with what is true about you. But done well, Why charts for all those that care about you — your customers, employees and investors — where you are going and inspires them to move mountains to help you get there.

Peter Damon is a branding executive based in LA. You can follow him on twitter @Brandfan