Start up, as it is more familiarly known as, is a newly established business. How does a startup differ from other businesses? Let’s put it like this, startup is the seedling stage of a business which is striving to concentrate on potential growth and revenue to support it, while incorporating in the processes its inner need to get things done in a smarter & efficient way. A person who has a startup idea is always keen on learning and getting better in whatever that will make the startup a success.
Whereas a business is a ‘fully established startup’ that has achieved its breakeven and further needs to focus on its stability in the longer run. A businessman perceives the environment more commercially and not radically. Not all startups grow enough to establish themselves as a flourished business house. Certainly the startup that survives, matures into a successful business that creates bigger and better employment opportunities subsequently for all.
Let’s understand the reasons for a mushrooming growth of startups.
- Startups are quintessential for any economy to flourish as they are based on fresh innovative ideas that create an opportunity to put available resources such as financial, social or technological to optimum use.
- Since the survival rate of startups is not too high, the failures come along with many worthwhile teachings that reiterate the significance of agility, resilience and persistence to the younger generation who structure the bedrock of a better future. A low survival rate needs more aggressive approach to increase the probability of the establishment of a successful business.
- Startups that survive and nurture themselves to become a stable business in turn create many new career opportunities that contribute to better socio economic conditions of the society.
- Startups are either capital intensive or talent intensive. In both the cases the dormant assets are put to work and subsequently either they are multiplied or at least out of the latency stage, thus catalyzing a win-win situation.
- Not all startups are focused on profit vending. There are startups that strive to exist in order to uphold a social cause such eradicating illiteracy, empowering women, eliminating child labor, making basic amenities available to all sections of the society etc. Such startups symbolize social entrepreneurship.
Though our economy is in utter need of a good number of startups, it is an appalling truth that a majority of them fail to thrive. What are the reasons behind such a miniscule success rate?
- Globalization lead to monumental diversity in terms of population, economy, resources etc. It is immensely significant to assess the inclusive nature of all the available resources that will contribute towards the increase in success rate for startups.
- Through research needs to be undertaken before setting out to execute the idea. The exact need of the product or service to be offered should be minutely understood to validate the startup idea which consequently will minimalize the risk of failure.
- Sufficient training and expertise should be acquired to facilitate & lead the team to work coherently. Realistic performance assessment goals should be set to avoid undue disappointments.
- Appropriate data regarding potential customer groups should be gathered in advance to preclude panicking situations where employees are well equipped to handle the potential customers.
- The finances that a startup is going to depend upon needs to be planned very meticulously to avoid resource crunch at the eleventh hour.
- A dependable legal team should be in place much in advance to escape any unwanted and irrelevant legal hassles. Any redundant legal issue has the potential of misleading the startup and make it lose its focus. Thus, leading to the failure of even a great product or service.
A wisely chalked out plan backed with a thorough research and eminent team that is well trained can never go wrong in making a startup successful.