Before you begin your journey of launching a tech startup, answer this question:
What are the similarities between these ultra-successful companies – Zoho, GitHub, Dell, HP, Apple, Harley-Davidson and Starbucks? What do they all have in common?
Well, there is only one axiom on which these aforementioned companies are similar- All these companies were started without any funding. And yet today they all are evaluated at not just millions but billions, and in some cases trillions of dollars.
It almost seems like a pipe dream. How are these larger than life companies brought into existence without any funding whatsoever? And, it’s not like there were more resources available in that time than there are today.
So what makes a tech startup with minimum to no funding successful? Is it the idea, is it the timing, or is it the team? What is it that you need to start a startup that would take you to such heights?
In this article, I attempt to crack the code of just that. So let’s dive right in.
Solve an actual, real-world problem for the technology business ideas startup
There have been instances where a list of tech startup companies with good ideas spend all their life waiting for funding to arrive. But the funding never came!
There have also been many tech startup examples where eager entrepreneurs, who can’t wait to get into the startup game, just start solving any problem they find. They put a lot of work in it, put in a lot of time and spend a lot in terms of resources and savings. But they are soon faced with the reality that the startup is not growing. And because they have put in a lot of effort and resources, they start creating additional problems where there aren’t any.
This is the recipe for failure. Going through this path will not result in success even if they put in a lot of hard work. Because they are not providing some solid value or solving a real problem. What is supposed to be the basic purpose of the startup, you fail at achieving that and hence no amount of effort will suffice.
These type of failures are not exclusive to startups, even big companies fall prey to such traps. Take a look at the Amazon’s ‘Fire phone’ for example. The launched an expensive mobile device with 3-D functionality and four cameras at the front. But what actual, real-world problems did that phone solve? People at the time didn’t want or need a 3-D smartphone, nor were they interested in having 4 cameras to the front. In short, the market did not find the device useful and Amazon suffered a huge loss of around $170 million.
When you come up with an idea for a tech startup, pay some mind to think: what are the chances that you are working on something which is not useful for most people?
Thus, it is very important for aspiring entrepreneurs to focus on solving a real-world problem which serves as a reason of bother for many people in the world. They must have a unique selling point for their idea – like if their idea makes things:
- Faster; or
- Cheaper; or
- Easier; or
- Is a completely new innovation.
Make sure what working on is something unique, not something that is already being worked on by other individuals or companies.
Do lots and lots of research
Get a lot of feedback about your idea or product, not just from your friends and family members, because they might be of the kind that always support and encourage you no matter how terrible your idea is.
Conduct surveys, go talk to your potential clients and customers. Ask them whether the problem you are trying to solve is really a problem worth solving. Ask if this is an actual problem or are there more pressing problems in the same field.
Inquire if these potential customers will be willing to pay for the solution. Also it would be useful to find out if there are other big companies trying to solve the same problem in a better or cheaper manner.
Do lots and lots of research and understand the pain points of your potential clients.
Create a business plan
Make rough estimates of the expenditure and the launch time. But none of this should be set in stone. Always be ready to put in more time, money or resources. Read tech startup articles, research the top tech startup ideas 2019, among other things
In the journey of starting a start-up, you will be faced with new challenges and unknown problems everyday. So your business plan should be flexible enough to accommodate changes you may need to make so as to best utilize the options that are available. In short, be read to improvise.
Build a MVP(minimum viable product)
Now that you are aware that your product actually solves a real-world problem and that there is a demand for this type of product, the next step towards developing your tech startup ideas 2020, should be to build a minimum viable product(MVP).
Identify as to how your product or service is different from other products or service. What are the one or two most important features that set you apart from your competition?
Now when you start making your product or service, make sure to put special emphasis on these one or two most important features.
Other features that enhance the beauty or interface of the product, or the other common templates that even your competition provides, are not the key factors you should be focusing on. These are unnecessary at the early stages, and not your problem right now.
Those aspects and features that set your product or service apart, put your blood and sweat into them, and you will have created something to be proud of.
Initially use your savings
Even if you don’t need any money for finalizing your idea or the business plan or doing the research, you will definitely need the money to build the MVP. For building your MVP, you will need to use your savings or any other money you can get, with no strings attached.
For utilizing savings, first you need to create savings. Don’t leave your job prematurely, save up all of your income. Use cost cutting techniques wherever you can.
Till you reach the point of building the MVP completely, you should take it as a given that whatever expenditure estimates you might have initially, you will surely exceed that amount three to five times over.
This is the essence of a startup’s journey, it is filled with pitfalls and curve balls. You will be faced with new problems which do not even exist in the playbook. Solving them requires time, money and resources.
So make savings and use your savings to cross such hurdles.
In the case where your savings don’t suffice, you will have to borrow capital from friends and family. But this comes with the possibility of an obvious pitfall – if your tech startup does not do well, then the relations with the people who helped you may get spoiled. To avoid this conundrum, try to make the terms of their investment as clear to them as you can. Clarify whether they should expect a return or not, or offer stock options or a returns strategy.
In any case, leave no room for doubt in such a scenario and make use of your savings as much as you can.
Focus only on profit
Do not waste time worrying about trivial issues, but focus on making profits as soon as you can. After all, your savings can only last for so long. Create a small team of reliable hardworking individuals.
As you do not have investments, the tension and pressure can become overbearing. So do not focus on growth in the early stages, instead focus on earning money. Growing requires dealing with major losses, and this strategy does not bode well with tech startup ideas with no external investments.
Use free and discounted services
In the age of social media, marketing has become essentially costless. You can promote your product or service on Facebook, Instagram, LinkedIn, and you can make good tech startups website with good promotional content for very cheap these days. In short, focus on free marketing
There are many companies and tech startups in world who offer their services to startups at discounted rates. Utilize these types of services.
Make sure that the demand of your product gets appropriately utilized and you are able to sell you product and services to as many people as you can.
Conclusion
Finally, it is not the idea alone that can make your startup successful. The industry is replete with stories of tech giants that started with bad ideas, but with a few key alterations, some new perspective, and a lot of hard work, ultimately became successful. You can have a bad idea and still it won’t stop you from doing anything.
It is not the team that guarantees your success either. There are also many stories of teams with the worst qualifications of their field becoming pioneers and business leaders through hard work, determination and other factors.
It is not the timing either. Timing is super important, but there’s no way of knowing whether your timing is right unless you fail at trying and then try again.
