How to help your startup go the distance
Rowena Vestey is one of Design Council’s Design Associates, an expert in strategic design and design thinking. Recently, she has been helping some of the winners of MedTechSouthEast develop their medical technology ideas in a ten-week accelerator. Here, Rowena discusses how startups can benefit from taking their time before diving in at the deep end.
Over more years than I wish to count, I have been privileged to meet and work with a large number of entrepreneurs and startup businesses, most recently in the hi-tech and IT sectors. Through my experience, I have a few general observations to make.
Those individuals or new companies that I have seen succeed have often not been started by people who wish to be seen as 'entrepreneurs'. They have been started by people who have a particular expertise and are driven to solve a specific problem, who then build a company and business processes around it to enable them to do it – or more specifically in the early stages – fund it.
For new businesses to succeed, they should from the start develop robust processes that support and enable sustainable innovation...
I come from a manufacturing background, my design teeth were cut winding carpet yarns and checking for flow lines, so I find process and process management quite exciting. It may surprise you to hear I am not alone. Words like dynamic and innovative are used to describe entrepreneurial endeavour and, in contrast, the words management and process sound fairly pedestrian.
However, the tortoise always beats the hare. Not that I am particularly advocating going slow, but for new businesses to succeed they should from the start, develop robust processes that support and enable sustainable innovation and, in extension, business growth.
Below are three observations based on hard-earned experiences of new businesses that I have worked with over the years.
1. Do your prep…
It is a truth that around 50% of startup businesses in the UK fail in the first couple of years. This is rarely because the idea was a bad one but more often because the entrepreneur or team had not done their homework.
Initial mistakes generally revolve around things like IP issues, lack of funding and market validation issues. The most important part of seeking market validation are the questions you ask and how you ask them. Then, crucially, listening very carefully to the answers.
I heard a story recently about a startup business advised by their mentor to undertake a series of interviews with their customer target market. A number of months later, that business mentor had a very irate client on the phone telling him the process had been a complete washout, providing no insights at all. When challenged on this the business owner replied "Well, I asked all the right questions but they gave me the wrong answers." This attitude is, unfortunately, not unique to this particular business.
Other issues involve prototyping. There is a simple rule for any type of product, or indeed service, and that is it is much cheaper to change a product early in the development process than to make changes once it has been fully developed. I appreciate this sounds quite simplistic, but many businesses I have seen over the years have rushed to market without spending enough time prototyping, and ultimately this has cost them dearly.
In short, initial mistakes generally revolve around business processes and this can be avoided with careful preparation.
2. To plan or not to plan…
We’ve all heard the sharp intake of breath resulting from advising a budding entrepreneur that they really should have a formal business plan if they wish to set up a company. But the fact remains, many startup businesses fail because of fundamental shortcomings in their business planning. The plan can be modest to begin with, but must be realistic and based on accurate, current information and educated projections for the future. A well thought out plan will encourage serious investors, which will allow the business to access necessary funds for growth.
3. Who is it all for?
From day one, or better still before then, the best way of building a sustainable customer and user base is to communicate and listen to customers, partners, suppliers and influencers. This may result in your hearing something you may not wish to. It may mean adapting or modifying your approach. Not listening is not an option. Putting processes in place that enable you to manage these changes will strengthen your business and may begin to develop an innovation culture at an early stage.
So, to return to our hare and tortoise, you could propose that, had he planned his route, analysed his competition and reviewed his own time management strategy, the hare may well have been the winner. But that’s another story.
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