Exploring statistics about startups is enough to turn most aspiring entrepreneurs away. Just consider some of these facts: over 50% of small business fail within their first four years. 82% of funds that support startups come straight from the entrepreneur’s pocket. And, perhaps most discouragingly, only 40% of small businesses that survive those first four years are profitable.
This is a post by SwipeSum CEO Michael Seaman, a professional entrepreneur and amateur advice-giver. Exploring statistics about startups is enough to turn most aspiring entrepreneurs away. Just consider some of these facts: over 50% of small business fail within their first four years. 82% of funds that support startups come straight from the entrepreneur’s pocket. And, perhaps most discouragingly, only 40% of small businesses that survive those first four years are profitable. But there’s good news: there are thousands of entrepreneurs that have been in your shoes before and succeeded. You have the benefit of learning from their successes, and luckily, you can learn from their mistakes, too.I had a few entrepreneurial experiences that got me where I am today. My first business, Snappin Studio, sold handmade gifts for people who aren't creatively inclined. My partner in that business is still running it today down in Florida. When I was in college, I started Tako Grip, which sold custom-made grip tape for athletes. Unfortunately, Tako Grip is no longer around. Both experiences were daunting, but I knew I had to take the risk. One was successful, one failed, but both of them convinced me that I wanted to try again. There were things that I knew I could do differently to bring better results. SwipeSum is my take three. While I don’t want to jinx it, things are going well (at least, much better than they did at Tako Grip). As time has gone by, I’ve realized that a lot of the success I’ve seen at SwipeSum have come out of my previous failures.You might be wondering what those lessons were. Well, I’ll tell you. Here are my top 8 lessons for pushing your startup to success:
For a startup to stay alive, it has to grow. For a business to grow, it needs customers. And if you don’t start selling now, how will you ever establish a customer base? Your product may not be as polished as you’d like it to be, but selling in the idea stage is a great way to collect feedback to further improve your product.There are so many opportunities to sell, too! Think of the number of potential clients you meet every day when you are running errands or going out to eat. Just because you are not “at work” does not mean you should turn off your selling switch. Instead, make selling part of your daily life. For example, I always ask to speak to the owner when I visit a restaurant in the hopes that I can introduce them to SwipeSum.
Odds are you are not the only clothing store, restaurant, or any other number of small businesses in the area, so competitors are going to play a large role in your day-to-day job. This competition makes business difficult, but it can also be a huge resource for you when you’re starting out. As a business owner, you can use the competition as a teacher for your own strategy. Did a rival business start a controversial ad campaign that resulted in a lot of negative publicity? Avoid that angle. Did they launch a promotion that brought in a bunch of customers? Consider launching a similar one of your own. When we were thinking about the company culture we wanted to establish at SwipeSum, we studied (and if I’m being frank, stole) some great ideas from companies we wanted to be like. That’s made a big difference to us.
Far too often business owners lose sales or clients because they are afraid their enthusiasm is off-putting to customers. Odds are you are thinking about your customers considerably more than they are thinking about you. In fact, research shows that it takes 6 to 8 touches to generate a visible sales lead. That means your potential customers need to see your name 6 to 8 times before they even consider purchasing from you. So get your name out there, and find that sweet spot of annoyingness that ensures your name pops up often enough to be familiar, but not so much that they start screening your emails.
Authenticity is key for converting customers, so let the uniqueness of your business (and yourself) shine through. At SwipeSum, we’re in an industry that’s traditionally very formal: suits and ties, meetings in high rises, you name it. But we are very much not of that mold. We’re here to disrupt the payment processing industry, and our culture reflects that by being young, vibrant, and active.If your company seems inauthentic to customers, you won’t be able to fully cultivate their trust. In turn, they’ll be less inclined to buy your product. So be authentic, but make sure you are letting your employees be authentic too. This means that you cannot require them to do everything your way. As long as they are producing their own results, you do you and let them do them.
When you’re starting a business it is easy to get overly focused on your big product. Don’t be afraid to create complementary products, and always keep your eyes open for new opportunities to expand your business. It probably goes without saying that starting a business is expensive, and most of those expenses are coming straight out of your pocket, so do not limit yourself to one idea. Seek out ways to create multiple recurring revenue streams and pursue them!
TOMS, Apple, and Spanx are all billion-dollar companies, but they have one thing in common: they started as small businesses, just like you. Never lose sight of the fact that your company can go big. Sure, you might have financial limitations that prevent you from getting there now, but without a big mindset, you won’t have the creativity required to reach that level.Look at Sara Blakely, for example. She was selling fax machines when she came up with the idea to cut the feet off of her control-top pantyhose--the start of her journey to founding and patenting Spanx. She had $5,000 to her name when she started the business and is now valued to be worth more than $1 billion.
Have you ever heard the phrase “fake it till you make it?” Right now you are just getting started, so there might be things that you feel inclined to put off. Don’t. When you reach explosive growth, you’ll be glad you did all the nitty-gritty work now rather than putting it off. Do whatever you can now to help prepare for a future of success. This means creating processes and policies that will help make that growth a little less painful for you. If you want to make it big, you have to act big.
Growing a business is stressful, but you can’t get negative. Everyone you meet from your own employees to rival business owners could have the influence needed to make or break your business. Make sure they feel inclined to make it. Even if they won’t be a customer, you never know who they know. Not only that, but you could be the person to make or break someone else’s dream. Offer introductions, help entrepreneurs sell, raise money, etc. As a general rule, you should be a little kinder than you have to be in any personal interactions. If you’re awesome to people, they’ll be awesome to you (and help you grow). Every good deed will come back to you in the long run.