SUMMARY
While thousands of businesses never get off the ground, a small number of them will certainly fail after a promising start
On the other hand, several startups succeed and challenge established players
To make a startup successful, every leader must focus on four key areas: purpose, profit, people, and product
Over the last ten years, India has seen a surge in the number of entrepreneurs. While thousands of businesses never get off the ground, a small number of them will almost certainly fail after a promising start. On the other hand, several startups succeed and challenge established players.
Every entrepreneurial journey begins with one person feeling the need to find solutions to a consumer need. The purpose and motto of the entrepreneur are what drive the establishment of a startup. The next step is to find like-minded people who believe in the mission and support your cause.
A startup is not only about solving existing problems, but also about running a profitable business that continues to give back to the community. There are numerous guides available to entrepreneurs on how to launch a successful business. To make a startup successful, every leader must focus on four key areas: purpose, profit, people, and product.
Purpose
Purpose is the north star for any business. For every startup, the purpose is the driving force. When the purpose of a business is defined, a leader can always find solutions to the problems that it is seeking to resolve through its startup.
Every startup faces dark days, where the founder wakes up and finds it difficult to continue. A brand with a purpose has the tenacity and strength to face the dark days. The passion for the purpose is what keeps any entrepreneur motivated to pull together on difficult days. The purpose is a superpower strength that gives any organisation tenacity.
Purpose not only helps a brand make good business decisions, but it also helps a brand find allies. Business and profits are no longer the only things that matter to any stakeholders. Investors, customers and talented employees are all looking for a business they can buy into. A business that understands what it is doing, why it is doing it, and how it is doing it has a better chance of understanding what the business requires.
USAA, a San Antonio-based Fortune 500 company, was founded in 1922 when 25 army officers decided to insure each other’s vehicles. USAA was established with the mission to facilitate financial security for military members and their families by offering a full range of highly competitive financial products and services. With roots grounded in the military, USAA proudly serves its members with exceptional service by demonstrating the core values of service, loyalty, honesty and integrity.
Inspired by the mission and commitment to provide excellent service to members, USAA stands financially strong. This strength enables USAA to pay all claims on time and serve a growing membership.
This mission has enabled USAA to not only survive for more than a century, but also to serve millions of members and become one of America’s only fully integrated financial services organisations.
Profit
While a brand’s purpose serves as its North Star, no entrepreneur should lose sight of the need to make money and build a business. Profit motivation will drive a leader to not only make concentrated efforts toward the goal but also to add value to the efforts that have already been made.
Profit, in essence, is a testament to the service/products provided to the consumer base. Profits can be viewed as a byproduct of the goal. This simply confirms that the problem exists and that the market has clearly demanded solutions.
The Tata group is an excellent example of a purpose-driven business that has established itself through good products and contributions to society. Aside from profit, this conglomerate is committed to serving the nation and creating a brand that every player in its respective industry will look up to. The brand’s goodwill value is much higher than its profits, and its goal of nation-building and inclusive growth drives the company’s profits.
People
The strongest pillar for any startup is its people. As a startup grows, every leader needs their stakeholders to believe in the cause and the vision of the company. People aligned with the purpose of the organisation bring passion and positive energy to the workplace and a brand ends up creating better products or catering new services.
Gone are the days when a company made money because it had the most fashionable or cheapest products. Word-of-mouth publicity and a brand’s social image can make or break a startup. A strong customer support system that is always answering customer questions and catering to their immediate needs, especially in the age of social media, helps in creating a strong consumer base and brand loyalty.
People nowadays invest their time and money in brands that have shared value. They are aware that they are voting with their money and time to advance a cause in which they have an indirect stake.
London Drugs, based in Canada, is one large company that has nailed this super app concept; they sell everything from pharmacies to residential flats because they’ve been able to build a community. It is the personalised experience that draws people to the product, eventually making every experience worthwhile.
Product
Products build the first impression of any startup. A good product can help a startup capture and transform customers. A positive product experience boosts customer satisfaction, loyalty, and retention. In the age of personalisation, it is imperative to understand a consumer’s need and provide solutions. Keeping the overall philosophy of customer centricity in mind, a well-designed product function provides business startups with competitive advantages in creating unique experiences for their target audiences.
End users will appreciate a product that is focused on purpose, profit, and people. This will contribute to the creation of a complete ecosystem for the growth of an entrepreneur. On the contrary, a negative customer experience with the product can be hazardous and have a cascading effect on its consumer base.
Dmart is the best example of a product-based company with customer-centricity at its core. Even though they do not manufacture any products, their service and convenience make all the difference in the market. Regardless of whether large players enter the same segment, none could be as agile and innovative as Dmart.
Caught up in the conversation about running a business, making profits, and becoming a unicorn, investors and entrepreneurs have forgotten that business is a deeply human institution. Having an investor on board and a financial cushion allows entrepreneurs to focus on running their businesses without stress. However, before onboarding an investor, one must ask whether he understands the organisation’s mission. Would his ideas and future plans help the organisation’s mission?
Before investing in a company, investors should inquire about its profitability and how its target market perceives the brand and its products. More than being caught up in the product’s innovation and potential market size, it’s critical to determine whether the company has made any profits and pushed boundaries to create its own market space. This is a testament to the founder’s passion for its purpose, which is often enough to propel the brand.
