How resourceful startups are changing the world
The small steps startups are taking to make a big impact.
Innovation today is increasingly led by startups. Unburdened by legacy systems, timely processes and established infrastructure, startups are unbound in their desire and ability to create. Some of these companies will play an incremental role in how we see the world and what lies ahead for all of us.
While we’ve all heard the tale of how startups around the world have gone from being small organisations to multinational companies, we’ve also heard of the rate in which startups fail. It’s estimated that 90% of new startups fail. A hard fact for potential new entrepreneurs to digest. However, there is still the 10% that are not only getting it right but changing the way people will operate forever.
The startup business model has opened up doors for employment opportunities, a thrilling working environment, more responsibility, more chances of learning, and more creative freedom. But what separates truly successful startups from the rest?
Let’s take a look at the small steps resourceful startups are taking to make a big impact in the world.
The experts they hire
There’s no doubt that entrepreneurs and their employees are hungry for knowledge. We know that they are typically young, eager and excited to be a part of a company that is working to fill a void in the world and will do whatever it takes to get the business off the ground.
Employees are encouraged to continuously learn and tackle any task that comes their way. They often wear multiple hats, due to their eagerness and due to the lack of resources. This is great for the beginning of a startup. When the energy is high and the company is small. However, in order for a startup to scale, the need to hire functional experts to take the enterprise to the next level is essential.
As these companies start growing, they face new challenges that open doors of complexity that only experts in their field can anticipate, manage and predict in order to prepare for future growth. Not only does this facilitate employee learning even more, but also helps ventures stay two, three, four steps ahead of their competition.
Take Birchbox for example, the highly successful online monthly subscription service that sends its subscribers samples of makeup, or other beauty-related products. In a Harvard Review article, Nicole Fealey, the director of people operations and performance at Birchbox, shared her excitement of being a jack-of-all-trades during the first 18 months of their business. ‘That’s what I love about startups,’ she said. ‘You never get bored.’
She shares that she soon realised that she and other early employees lacked the knowledge and experience to handle everything on their own as the company grew. To manage such complex work, Birchbox divided it into specialised functions and sought out domain experts to improve the effectiveness of each one. Their new hires included a CTO with a computer science PhD from Carnegie Mellon and a vice president of brand campaigns who had been a principal at Booz & Company.
They understand risky business
The ‘go big or go home’ mentality is ripe within startups and it’s what keeps them relevant. These individual or group of individuals are not afraid to take risks and daring steps. Unlike traditional corporates, startup companies are not afraid to set their goalposts extremely high, even though chances are that they won’t succeed.
Let’s look at Netflix for example. In the ’90s, Blockbuster dominated the scene with 900 stores worldwide. They had a monopoly over the video hiring industry. Netflix, which was also founded in the ’90s, too focused on renting movies, but via ordering them online and having them delivered via the post. However, after struggles with their postal service model, like people not retuning the videos, Netflix was very near filing for bankruptcy. However, Netflix believed in the power of the internet and took the risk, which Blockbuster thought was too risky, and decided to try to deliver movies directly over the internet. A big risk that had a big payoff.
However, knowing and understanding the risk is what truly matters. Startups need to understand that their business will likely fail and be willing to adapt and take the necessary leap of faith to avoid this.
Their working culture and company values
It’s hard not to imagine a startup without a cool office space. Google really set the bar for this. Larry Page, and Sergey Brin, the founders of Google, wanted to make Google a fun workplace for its employees. This completely unhinged the way that ‘office places’ should look like and what they should serve for their employees.
In startup environments, employees are often encouraged to take a time-out when they need it or even have a quick game of foosball or table tennis to blow off some steam and connect with their colleagues. This type of culture is typically a big part of what draws people to join start-ups — and what keeps them there. When working long hours and late nights, this sense of culture if what keeps employees motivated.
Founders of startups know that this mentality works. However, as more employees are onboarded and systems are put in place, employees tend to become frustrated and will often leave when things become too formalised to find the magic of a startup environment somewhere else.
Startups that prioritise keeping its values and culture alive by hiring for cultural fit and rewarding desired behaviours through recognition and remuneration are often successful when it comes to retention. Employees need to understand the long-term vision within a company, that what they are doing matters, and that they are all working toward a common goal.
They are not afraid to put structures in place
Although startups value and pride themselves on their ability to move fast, have control, and the intimacy they have with their team, implementing management structures to accommodate for growth and scale is what will really set startups apart.
Startups move at a rapid rate, however, sometimes too fast that it hurts their ‘big-picture’ outlook. Many entrepreneurs will resist formalising structures. They often develop strategies as problems arise, lacking a frame of reference because they are starting from scratch, and they take a similar impromptu approach to building their establishment.
This doesn’t mean that scaling should entail separating from their start-up identities and embracing large-company stereotypes once they’re destined for growth. This can mean developing new products, ventures or services, entering new markets, or engaging in other forms of innovation.
Those prepared to manage that growth, take the risk and to learn new ways of operating and behaving, stand a much better chance of making it in the long run.
Are you a startup, hungry to make your mark in the world? The Delta is a corporate venture builder that specialises in the validation, building, championing and scaling of startups from the ground up. Get your business off the ground today. Get in touch here.
