CEO Jan Beránek has been running U+ for 8 years and has encountered certain patterns, both in his own work, and mentoring others at Google Launchpad in San Francisco and the European Space Agency Business Incubator in Prague. We sat down with Jan so he could share some of his observations about common issues which prevent startups from success.
Testing, one, two
Hunches can be good, but don’t only go on hunches. If you add an expensive feature, know why you’re adding it. Startups often add features without a clear sense of what should be done next per the needs of the users. Use the evidence available to you: talk to users. To build up a solid foundation, you need to set up the collection of your data properly, and then make decisions according to the data to consistently grow in a stable manner.
Chose ideas that solve a real problem
Which should be the first thing you do, but really should always be on your mind. There are two kinds of successful companies: one solves a friction, the other solves a frustration. A friction is, for example, needing groceries but not having time to buy them because the process takes too long and your schedule is too crowded. A frustration is more acute, something like not being able to get a mortgage in certain countries due to a lack of options or legislation.
Another analogy used for startups is the difference between vitamins and painkillers. You could go without taking your vitamin C and not miss it too badly, but if you have a whopping headache, then only a painkiller will do. These categories don’t purely have to do with a company’s actual purpose, but may instead involve a small shift of thought in the way a product is marketed. In the world of startups, painkillers sell better because you absolutely need them to solve your immediate problem.
Lack of focus
When building up on user testing, it is important to vet all possible features against the vision of your product. For example, if you’re building a project management platform and a lot of clients want you to connect it to their particular accounting system, it might not be the best course of action for the long-term growth of the company. Know the benefit you are delivering to customers. Too many random features, especially too early on, will dilute your vision rather than enhancing it. Having a strong vision is key to continuous long-term growth.
Many of the local successful companies that are now going international need to think about this from the perspective of common needs in different markets. While you might have giant initial success for the market you’re in, don’t let this cause you to lose sight of why you founded your company in the first place and how it can scale internationally.
Victory is mine!
Don’t declare victory too soon. Internally, this will cause complacency in your company, and under-the-hood problems will start to build up. Common problems might include issues with leadership and customer support. Externally, especially when you are expanding to a new market, it is important to humbly build up the base you’ve already developed in other countries. As in science, a new discovery only sets a new level for what we already know in the world of unknowns. In addition, since you have the attention of early adopters, you must find a way to expand on it. You should be thoroughly validating your idea and realizing your product’s market fit. Always.
Stop telling, start selling
In a management-level position you’ve been trying to throw your arms around the world, but your reach is starting to exceed your grasp. As it should. If you’re growing steadily, then start delegating. Many founders become overwhelmed because they feel they know how everything should be done and can do it best. Maybe that’s true, but you’re only one person. If you pull back on merely issuing instructions to your team, and instead help foster a capable team that can prioritize and figure out things for themselves, then you are giving yourself an exponentially better basis for successful scaling. “Selling” is thus the art of gently insinuating the right direction. Of course at first things will be rockier, but team members will learn and grow to become more self-sufficient, as will you.
Wax wings only get you so high
Economist Danny Miller coined the term “Icarus Paradox” based on the classical myth of wax wings taking you only so high. The same wings that carried you and your small early team to initial success cannot take you further. If your original tools and methods have made you successful, don’t be inflexible: you will need to expand and overhaul what’s previously worked to handle your growing company and the fast-moving world around you.
