Every year, creative and ambitious entrepreneurs launch a startup business.
2019 is proving to be no different, with even more businesses than ever trying to make it past the startup phase to become a profitable company.
Of these, statistics show that 90 percent will fail.
What can you do to put your startup into the 10 percent group that succeeds?
Characteristics of Successful Startups
Startups that succeed have four characteristics in common – become familiar with these and you may become a success story:
1. Have a valuable product or service
It’s crucial that you’re selling a product or service that fits the market and that consumers want to buy. 42 percent of failed startups claim that not having a viable product or service is one of the reasons they were unsuccessful.
2. Pay attention to business details
Successful startups pay attention to all the details, no matter how small or insignificant they may seem. This includes every point of the business plan all the way to business processes and product development.
3. Be prepared for fast growth
The faster a startup grows the happier investors are going to be. Investors, particularly venture capitalists, want to put their money into startups that show rapid growth. Startups not on board with fast growth often run out of money as they lose customers to their competition, ultimately losing the passion and drive needed for successful new businesses.
4. Recover quickly
Successful startups know that there’s no such thing as a single entrepreneur – they understand that it’s all about teamwork. And it’s teamwork that’s going to help the business make it through the rough patches that all startups experience.
Understanding the Statistics and Trends
When you’re getting ready to build your own startup, understanding the statistics and trends can give you valuable insight into what you can expect. Some of the stats to focus on include:
- Startup success rates – How many small businesses make it past the startup phase and become successful, and why.
- Startup failure rates – Not just knowing what percentage of startups fail, but why, may help you avoid the same mistakes.
- Investor information – Understanding what investing is about, such as where financing comes from and what investors are looking for, can give you an advantage when pitching your startup.
Just as important as startup stats are the current trends you need to pay attention to if you want to make an impact as a new business.
Some of the trends that can make or break your startup plan include knowing what your most expensive startup cost is going to be, how many rounds you may need to raise before you reach Series A funding, and how many startups are profitable, break even, or see a loss.
The Future of Startups
There’s no doubt that startups will continue in huge numbers in the coming years. Some of the things we can expect to see in the near future are startups that are open to collaborative partnerships as well as more startup founders moving from the West coast, where they’ve been predominant, to the East Coast for new opportunity and growth.
Final Word on Startups
When you’re ready to start your own business, use statistics and trends to give you leverage, but don’t be discouraged from working towards your goal.
As a first time founder you may have an 18 percent chance of failing the first time but trying again increases your chance to 20 percent to be a successful startup.
This infographic was created by Embroker.