Well, there are some lessons that I have learnt in my journey…. and as an entrepreneurship evangelist, have had the opportunity to observe many startups start up, and fail. Here are some observations:
- Don’t underestimate the costs and time that you will require to meet your milestones – often entrepreneurs, enthused by their deep passion and conviction in the concept, expect things to happen sooner than it would, and they usually expect to achieve it in lower resources and costs than it would. Running out of cash is the single biggest horror that a startup or early stage company can face.
- Plan for the worst-case situation… not the best case. Most entrepreneurs prepare business plan, which look at the most glorious of outcomes. While that is a possibility, it is prudent to think hard about what aspects could go wrong, and think of plan to mitigate those disasters. If the venture does well, enjoy the ride, be sharp and steer it towards success. However, if you have planned well for disasters, you will be able to manage the startup even during times of significant challenges.
- Ensure that co-founders are aligned on the vision, the pain in the journey and each other’s views on key decision points in the journey (e.g. how would you react if you were to get an offer to sell of for $ 10ms… what will be your decision if the offer was $2mn?)
- Talk to customers. Don’t plan on the basis of your enthusiasm and conviction. Test the concept with customers/consumers. Even before the product is ready, have conversations with potential customers/consumers to get their feedback and thoughts on what they would like to see in such a product.
- Be very, very careful about whom you hire as your first employees. Make sure that they are in it with some level of conviction and passion for the concept. Pure commercially inclined employees will not have it in them to pull through the ups and downs, the course correction, and the challenges of the early stages of your journey.
- Keep your costs low. Be frugal. Plan your cash flow and fund flow requirements well. Make sure you are well funded. Dont assume that you will be able to raise the balance amount as you proceed along in your journey.