startups

Quit, Pivot or Sweat it Out: How to Choose Your Startup’s Next Steps

By | Startups | No Comments

A Controversial Proposition: Plan for Startup Failure

The experience of running a business from scratch and achieving a certain level of success gives pride and hope for a better future for entrepreneurship. However, often startups need to keep evolving to suit the changing market environment and eventually be ready for any possible outcomes. A number of startups feel assured about their future roadmap and resist the idea of an exit strategy. However, experts suggest that having a good exit plan can actually increase the entire value of the business.

At some point in the life of a start-up, the founders or stakeholders have to decide whether to persevere, pivot or let a business die based on the value it generates for the target market.  For example, Youtube founders decided to get acquired by Google in 2006 and be the primary outlet for all video content. This provided the required momentum and ecosystem to achieve Youtube’s full potential.  Similarly, PayPal enjoyed a first-mover advantage in the online payments industry and competed with large banks. Still, its board members decided to get acquired by eBay so that it can achieve the required scale and penetration; as the PayPal model of business needed huge volume maintain its success.

How do you decide whether to persevere, pivot or let your start-up die?

Every start-up business needs to do a market test for its offering after a period of existence. It needs to implement a certain set of metrics targets and a realistic timeline to make a judgment for the future course of the business.

Let’s understand how to decide the business potential in the years to come:

Establish clear metrics that need to be reached

The companies can use sales metrics, financial metrics, customer conversion metrics and digital performance metrics to gain a better picture of the enterprise. Decision making using a combination of different metrics show the current position of the company.

Set a realistic target and schedule

A realistic timeline is everything. Startups need to set a realistic timeline to achieve the target numbers of the performance metrics. The timeline may depend on the various factors such as the funding availability, market conditions, concept awareness in the users.

Test value propositions of company to make the right decision

Based on the measurements of the metrics as explained above, the founders can make a decision about the future path for the businesses. However, usually it is not such a black and white decision; one must analyze the parameters before making a sound, metrics-based decision.

Now, let’s understand the above 3 points in detail.

  1. Establish clear metrics that need to be reached

The business should focus on right metrics for a better understanding of the company status. Identify the key value propositions to signify the potential of the business – for example, in some business models immediate profitability does not represent a viable parameter to measure, but the gross sales value makes more sense for future growth. Rely on Sanity analytics to improve the business and resist the temptation of vanity metrics. There are different types of metrics that startups should choose based on their business model.

Sales metrics – This can be measured to understand the total value of the product/services sold in the market over the period.  

Financial Metrics – Companies should on focus on profitability, burn rate, operational efficiency and gross margin to understand the cost involved in the production, revenue left for scale up, necessary and unnecessary expenses.

Customer related metrics – Key parameters to be measured are the number of subscribers, Customer Acquisition Cost, Retention Metrics, Churn Rate.

  1. Set a realistic target and timeline

Setting a realistic timeline depends on various factors starting from the market conditions to the larger economic scenario. Also, it depends on the type of offering; for example, if the offering is premium and niche then the timeline to achieve the customer numbers would be long, whereas if the offering is for the mass market, then the time to reach target customers might be shorter. In some cases the timeline is also driven by the availability of funding as adding new features requires more investments.

  1. Test value propositions of company to make the right decision

Based on the parameters measured explained in the above entrepreneurs should continuously reformulate or realign their value propositions.

Below are the steps to make a choice:

Test the viability of the business

If the company achieves the projected metrics within the decided timeframe and also shows future potential, one must decide to continue with it. However, it might be a right juncture to scale up the business. This can be done in two ways below

  1. Find external funding to grow the business organically.
  2. Merge with another business to gain access to the larger market, subscriber base, funding, complementary solutions/technology or the workforce

Pivot

A business needs to understand the customer priorities so that best value propositions can be designed. If the metrics show a gap in your offerings and the customer expectation or there is a serious market change, there is an indication to pivot your business.  

You might have to change your target market, value propositions as per your unique selling points and the market fitment. Sometimes you have to change the business model and revenue model to suit the customer behavior.  This sometimes results in a completely new product or service offering compared to the original idea.

For example, Odeo, a network to find and subscribe to podcasts, saw the sudden change in the market when iTunes began taking over the industry. The company decided to make a drastic change and run with the idea of a micro-blogging platform which is now popularly known as Twitter.

Kill and exit the business

Founders and stakeholders need to make a decision to quit and kill the business if

  • It is not achieving the growth projected.
  • The target market is diminishing.
  • There is a disruption in the market completely changing the customer behavior and making your product obsolete.
  • There are no idiosyncratic capabilities or qualities that can be leveraged in another market or solutions.

It is always hard to make this choice, but founders must see the larger picture of the current business. Getting emotionally connected without a proper exiting plan can diminish or restrict the company growth. It is important that any entrepreneurs should reinvest resources both in terms of money and efforts for creating better value for the society.

Finally, every company should focus on creating net value for all its stakeholders in particular and for society in general. In an ever changing competitive environment, a wise entrepreneur invests his time and money in the right place, realigning his vision and goals whenever required.

 

remote work culture

Fostering Positive Remote Work Culture to Increase Productivity

By | Remote Work & Culture | No Comments

Is the traditional office a thing of the past? Thanks to the endless possibilities in the way tech (and other) industries organize work in the 21st century, there has been a huge upturn in the amount of people who are able to work remotely. But what exactly does working remote entail? Remote workers telecommute and telework outside of a traditional office. Some companies combine remote and in-office workers while some companies are completely distributed, without any headquarters (Zapier, GitHub and Mozilla are some of the giants who are hiring remotely in 2018).

Many companies are afraid to implement a remote work culture, fearing a drop in productivity. In actuality, 86% of workers prefer to work alone to hit maximum productivity, which remote work encourages. It can also help to reduce stress, 82% of remote workers report lower stress levels than in-office workers. Remote work even decreases turnover rate, with job attrition rates falling by over 50% when remote working options were offered.

If you want to reap the benefits of remote work, you’ll need more than just wifi, PC or laptop. You’ll need an awesome and positive remote culture to keep your employees engaged and happy in their jobs. Establishing a positive remote culture can help your employees feel more connected to their jobs, increase productivity across teams, and even increase the amount of time employees stay with your company. Remote work, like any office environment can also fall victim to a negative working environment. Keep an eye out for things like workplace gossip and overworking, as these things can tear down any work culture, including a remote work culture.

Communication is Key

One of the biggest things remote workers have to maintain is constant communication. Luckily, tools like Slack and Trello have made staying in touch easy for remote teams. Because almost all communication between remote teams takes place through chat, it’s important for remote workers to over-communicate. Encourage people to speak up when they share a problem, share an accomplishment, or even just to ask a question. This kind of communication ensures that there are no confusions when deadlines come up and that projects move quickly. It also helps remote employees feel like they are being heard and recognized by their coworkers and managers.

Communication is not only important for the business side of things though, it’s also important for building team morale and connecting with your coworkers. Many companies facilitate this by implementing non-work related chat rooms into their company’s Slack. This means you’re not losing out on those water-cooler type conversations that can help employees feel connected to their coworkers.

Encourage a sense of ownership and leadership

Nobody wants to feel like they’re just executing tasks. This is especially true of remote workers. Be sure that your remote work culture encourages ownership and leadership. Give remote employees the opportunity to “drive the ship” and make it clear that there are always ways to advance. This helps your remote team feel like they are a part of the company’s success, not just the people executing it.

Define company values and culture

We’ve already told you community is incredibly important for fostering positive remote culture. But no community is complete without a common goal. The best remote companies have a few core values and principles that bring everyone together. Figure out what this means for your company, and don’t just phone it in. Live and breathe your values, and your employees will do the same. Remote culture is about more than working from your laptop, it’s about being a part of a team that is working together towards a common goal.

Document and Track the Essentials

This is possibly one of the most important things to establish in a remote culture. The real reason managers are afraid of remote: loss of productivity. Though we know this isn’t the case in many remote working environments, clear documentation can put your mind at ease and will let your employees know exactly where they stand and what they can improve.  

Many remote-first companies document absolutely everything. Every set of meeting notes, every conversation that led to every decision. As with communication, over-documenting is always preferable to under-documenting. Many cool project management tools exist today to allow you to customize how you want to document and track your workflow.

Celebrate everyone’s individualism and quirks

Remote workers can come from every corner of the globe, and are great examples of how diverse the workplace can be. Be sure to celebrate and support this in your remote employees. When morning people are given the flexibility to do their work when they’re most productive and night owls are allowed to burn the midnight oil, the whole team benefits from better work. Making your employees feel valued for what makes them great at their jobs is something that should be present in every working environment, but it’s especially important for remote workers who don’t get that face-to-face confidence boost.

8 Reasons to Launch Your Startup in Singapore (And A Few Not To)

By | Entrepreneurship | No Comments

These days, Singapore seems to have it all– a strong and stable economy with growth areas in finance and telecoms, Eduardo Saverin, the largest increase in per capita income any independent nation has seen within 50 years. Frequently dubbed the Switzerland of Asia, it’s known to be one of the best places to launch a startup today. The startup scene is thriving and home to many top-tier startups: Grab, Hooq, MyRepublic. The Singapore government seems committed to nurturing and expanding the tech ecosystem. Pair that with a solid political climate, Singapore seems to be the perfect choice for to launch your startup.

But first, why Singapore?

The Singapore startup space is thriving and growing every year, but there are still some pros and cons to consider before making Singapore your base.

Some of the most common reasons people choose Singapore as their startup home:

  • It has an affordable tax rate
  • A vibrant and thriving startup scene provides ample networking opportunities
  • A healthy venture capital industry
  • The government is actively interested in supporting startups
  • Its location is perfect for connecting with the much larger Asian markets all around
  • It famously takes 2 efficient days to register your company in Singapore

Some of the difficulties:

  • If you’re a foreigner, you’ll need a visa
  • There are a lot of startups in Singapore, so you’ll have some competition
  • Singapore is small, you’ll face all the attendant challenges of a small market
  • Higher costs of setting up your business despite all the advantages of doing so in a developed nation

1.  Vibrant Singapore Startup Scene

Having other startups to network with and bounce ideas off of can help your startup to stay abreast of developing trends. Singapore has this in spades. Singapore’s startup ecosystem contains ample opportunities for growth. Singapore is also home to many accelerator programs, within which you can network and grow your business. These include Startupbootcamp Fintech, Fatfish, Rockstart, and Jungle Ventures. These accelerators can help you get your startup off the ground and connect with people who share your vision.

Singapore also has a lot of places to work, whether you’re a one-man show or a budding business. There are many coworking spaces that offer solutions for startups of all sizes. These spaces allow you to have a professional office space while staying connected with other startups in the community.

2. Attractive tax system

Singapore boasts an incredibly attractive tax system for new companies. It includes tax breaks for businesses within their first three years. This can reduce their tax rate to 0% for the first 100k of income, which makes launching a new startup easy. Singapore’s corporate tax rate is also capped at 17%, making it a great choice for businesses concerned about rising tax rates as they scale up. Dividends are also distributed to shareholders tax-free, which makes investors more likely to put their money in startups.

3. Sizable amount of interested investors

Remember when we said the government in Singapore loves startups? They’ve recently introduced an initiative called Spring SEEDs which allows startups and investors to receive investments from the government.

4. Dynamic Workforce from Many Countries

Singapore has a diverse population of smart and savvy potential employees who can help grow your business. Singapore not only boasts of an incredible education system that prepares students well for the fast-paced startup world, it also has liberal immigration policies that allow you to source talent from a diverse international pool. This can result in creating teams that are smart and agile, the perfect people to take your ideas to the next level.

5. Strict Protection for Intellectual Property

Singapore has some of the strictest IP protections in the world. This makes it easy for startups who need to have IP protocols in place to launch their startups in Singapore feeling confident.

6. Enthusiastic and Innovative Government Efforts

The government in Singapore is making great strides to make their country a startup hub. They’ve fostered tons of grant programs and initiatives to make sure that startups can launch and stay successful while in Singapore. We previously mentioned the Spring SEEDs initiative, which allows startups and investors to also receive money from the government.

There is also Startup SG, which offers support for founders, developing tech, and avenues of equity. This initiative supports startups of every step of the process, from launching to protecting their product.

Singapore has also fostered an Angel Investors Tax initiative, which allows angel investors to enjoy a tax break of up to 50%. This initiative makes it easy for investors to confidently invest in early-stage startups.

Singapore also has a number of grants for qualifying startups. These include the Capabilities Development Grant (CDG), which can cover up to 70% of qualifying project costs, the Productivity and Innovation Credit (PIC), which can offer businesses a 400% tax break or a comparable payout.

7. Strategic Location for Business

Singapore has a strategic location for new startups looking to connect with foreign markets. 49% of Singapore’s residents actually claim citizenship outside of the country, which means it is a great place to spread the message about your startup. The geographic location also allows easy access to Asian and Oceanic markets.

8. Plus, a great place to live too!

Besides being an amazing place to launch your startup, Singapore is an awesome place for anyone to live. The diverse community allows you to meet people of different backgrounds, and the modern city leaves nothing to be desired. Everything from fantastic food to modern architecture, Singapore has everything a modern tech guru like yourself needs.

Boostrapped Startup Co-Working Space

Bootstrapping a Startup: An alternative to raising funds

By | Entrepreneurship | No Comments

Every business after reaching a threshold size needs an influx of capital to scale and to expand the enterprise.  However, many times entrepreneurs have to decide on how they would want to grow in the early stages, i.e. faster growth by raising funds or gradual growth by bootstrapping. There are many successful entrepreneurs’ stories which depict the advantages and challenges in both, bootstrapping and raising money through either angels or VCs. Read More

Death to Resumes and Cover Letters

By | Remote Work & Culture | No Comments

How can a company spot talent effectively and efficiently? With almost a dozen open roles, hundreds of applicants, and an HR team of one, this was a critical question for our small, rapidly growing company to answer. Doing so lead us to re-think two fundamental pieces of traditional applications, cover letters and resumes, and resulted in increased quality and a more than 10% jump in efficiency. Read More

How to Coordinate a Global Team

By | Remote Work & Culture | No Comments

39 time zones. 194 countries. This is the new world of remote work, and it’s a world of opportunity. The benefits of tapping into a global talent pool and reaching customers around the world are tremendous, but coordinating remote, global teams also poses a new set of challenges. These are the tools and practices we’ve found that make coordinating a remote, global team really work.

Read More

Things to Know about the Lean Startup Methodology

Things to Know about the Lean Startup Methodology

By | Entrepreneurship | No Comments

Tech startups are the hot topic in the world of entrepreneurship these days. Since the booming popularity of Uber and Airbnb, more and more people are fixing their attention to creating the next big thing. Launching a new venture, whether it’s a tech startup, an online store or any business in general—requires careful planning and the right adoption of strategy. One of the new catchphrases in the startup world is “The Lean Startup,” which is a method of running a company that favors experimentation, customer feedback, and interactive design. As the founder and CEO of one of Southeast Asia’s emerging tech partners, Guillaume Catella shared his thoughts about the Lean Startup and what that entails for aspiring entrepreneurs. Read More

7 Things that Every Entrepreneur Needs to be Successful

7 Things that Every Entrepreneur Needs to be Successful

By | Entrepreneurship | No Comments

Did you know that young people make up 50 percent of the world’s entrepreneurs? According to the 2013 Global Entrepreneurship Monitor, those between the ages of 25 to 34 show the highest rate of entrepreneurial activity. The rising popularity of tech startups backed by increased connectivity and technological advancement has motivated more and more people to start their own business.  Read More