Should Startups Hire Consultants?

“Why do People need Doctors? Why does a pilot need a Co-Pilot?
Chances are you have already understood half of the jobs that Startup consulting firms are hired for.

Traditionally, Consultants from Consulting Industry Giants like McKinsey, Bain, BCG etc are extremely expensive and hired exclusively by Top Enterprise Companies.

There are several small to mid-size consulting firms that cater to the SMB’S. With the rise of Startup revolution, a number of Startup Consulting Firms have popped up most of which provide complimentary but indispensable services to Startups like company registration, business plan creation, pitch decks and fundraiser plans. Some of the reputed ones do offer Strategy and Management Consulting services as well.

Question is that, given their size, stage and cash flows, do Startups need Consulting services?
Let me list some advantages of hiring Startup Consulting firms and if it fits your use case and if you should hire one is up to you to decide.

1. You need to know the Best practices
   No matter how long you’ve worked in the vertical, running a business is a completely different ball game. You need to know the Best Practices followed across industries to keep the operations streamlined and efficient. Following them would minimize the rework that might be needed later and help you focus on growing your business now.
2. You need a Business Plan
   Creating a Rock Solid Business Plan early on is the most critical aspects that most Startups fail to create. You need to identify your business model, revenue streams and need to turn your narratives to numbers. This will help you create hiring timelines, allocate expenses, forecast revenues and raise funding. Consultants will help you create a Step by Step plan to make your Business profitable.
3. You need Well Defined Milestones
   A consultant can help you create a Go To market Strategy. Competitive analysis and Customer requirement gathering will help you break down your vision into well-defined milestones and create an executable product roadmap.
4. You need to know the Market
   Consultants can help you understand a holistic and disparate view of the Market. Complete understanding of the value chain or customer segmentation helps in market sizing and targeting the right customers.
5. You need the Right Contacts
   Consultants can help you identify and connect with mentors, investors, or businesses to partner with. They can help with Domestic and Global expansion which otherwise would be difficult and time-consuming.
6. You need things done quickly
   Building a Startup by its core definition is a race against time. You are better off outsourcing some jobs to the experts who in retrospect you’ll find saved you countless invaluable hours.
7. You need a third perspective
   You can be too large, complicated, and emotionally involved to understand the inner workings of your psyche. A corporation post a certain size loses the ability for self-diagnosis. A third perspective will help you contain your thoughts and focus on what’s important and drives value for your business.
8. You need someone to tell you whats working and whats not
   You will almost always be carried away by the decisions that you’ve made and processes/operation in place. Your judgment will be clouded by diversified workload, and emotions. A consultant will tell you what’s working for your business and what is not. It will help you keep your costs low and increase profits by identifying operations and campaigns that need to be shut down and the ones that need to be continued or invested in.
9. You need Subject Matter Experts
   Being a Startup, you want maximum output from minimum resources. At the same time, you need Star Players to handle Finance, Marketing, Development etc.
10. You need a vision into the future
    Chances are that started small and created a niche market for yourself. But with changing times comes changing requirements. You need Super Smart people who can influence your decisions. You need access to Senior Leadership who have been there and done that. They can guide you in building core values for your business, and create a vision to work towards building a company that you had no idea could ever exist.
11. You need someone to boost your confidence
    Building a startup is tough! your idea or progress validated by super smart people will give you and your team a much-needed Confidence boost which in turn will help in increasing productivity and happiness.
12. Neutrality/ Consensus building
    Internal consultants lack clout and are conflicted. They fail since they need to provide sometimes harsh recommendations on their peers. Political leverage that you get from hiring a consultant can help the decision-making process.
13. You need access to data and analytics
    You have access to your data and some more data that you have collected over the course of time. But Consulting firms have access to way more data. They have already produced analytics to make the right decision. They have access to 1000’s of case studies that more or less will map directly to your business.
14. You need a Global Perspective
    Consultants deal with companies of all sizes both domestic and international. They can help you understand the Global perspective to build your product and target market accordingly. What may work in India, might not work in the USA. Can you vision Self-driving cars in India in the immediate future?
15. You need to know multiple industries
    Consultants have worked across several industries and have knowledge of how they operate and affect each other. You might know your industry well enough but an eye into complimentary industries is always an advantage to move fast and create a disrupting business.

Should Startups hire consultants is dependent on the team pedigree, the problems, the scale and the funds available. But if you find the right fit, a consultant can add a lot of value to your business.

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