If you read digital news frequently, you’ll already know that the hottest topic of conversations today is startups.
Call it the need of the hour, or blame Unicorns, but everyone is after the ‘next big thing’. Entrepreneurs are obsessed with coming up with an idea that might be this ‘next big thing’, and investors are after ‘opportunity’.
Let’s get real, entrepreneurs are the new-age poster boys! They’re even leaving behind politicians and celebrities when it comes to making news or raising controversies.
The thing called ‘startup success’
Whenever a new idea enters the market, there are hundreds betting that it’ll be the next one to make it to Forbes in a short time.
The basis of their judgement?
- the idea getting into an incubator
- raised venture capital money
- a feature on popular websites like TechCrunch
- millions of app downloads and unpaid users
I wouldn’t say that the party betting was wrong - if it wasn’t for the half-baked ideas that are often deemed the ‘next big thing’.
There’s a hot new startup in the limelight every other day, but, the truth is, 90% of these fail. Even the ideas that progress and meet the ‘criteria of success’, more often than not, lose momentum and become a thing of the past.
Don’t believe me? Check Forbes!
A recent consumer survey suggests that the average number of apps in a user’s smartphone is 42, but less than 10 are frequently used.
Ask yourself – what are the most productive apps that you frequently use? The answer says it all.
It was proven during the dot com bubble that human lifestyle cannot be automated through the internet. The same applies to mobile apps. People love varied experiences, and it’s natural to try out newer things out of curiosity. But what makes business sense is the increase in convenience offered by a mobile app that makes users use it regularly, and willing to pay for it.
Even though getting funded is a step towards success, it isn’t always associated with actual validation of products. Let’s face it - investors are here to make money and they take their chances with due diligence - however, it is not too different from a lottery bet.
With today’s Internet economy, the possibilities for a startup are immense, and the liquidity of money in the market just makes the journey smoother. Also, investors don’t want to miss out on an opportunity, and web journalists are racing against time to be the ones to discover the next unicorn!
Question - does claiming a huge venture capital round or a PR feature mean success? Does any of this matter to your customers?
No. What matters to your customers is whether your product resolves any of their day-to-day issues. Once they have something they relate it to, you won’t believe how willing they are to pay for it. But they don’t look at your fundings or PR features, not once. As a matter of fact, most people don’t even know these statistics!
What ‘startup success’ really looks like
Put yourself in a realistic and satisfying position, and don’t get distracted by the PR glory or funds you bag within a week of putting your idea in the market. Here’s what really defines a startup’s success:
- products that solve real time problems irrespective of their nature and size
- customer traction out of need, and not multiple advertisements
- steady inflow of revenue and profits
- customer retention and the ability to get referrals
So, before you give too much importance to the sexy side of starting up - fundraising and PR - remember that the above 4 points should be your primary goals; everything else is secondary.
Doesn’t match what you’ve heard? Well, this is the truth - coming from a guy who has been through the grind.