I’ve been involved in the startup ecosystem and community for a number of years in several capacities, and through these experience, I’ve come to appreciate two fundamental elements above all else: the first is the desire to change the world for the better, and the second is the strong sense of camaraderie and community. The Lean Startup author Eric Ries is right, I think, in defining a startup as “a human institution designed to create a new product or service under conditions of extreme uncertainty.” That’s both exciting and daunting, and not to be taken lightly. I’ve had the benefit however of picking up on some common threads across the most successful startups in the community, and these represent my 5 key guiding principles for entrepreneurship:
1. Solve a real problem
A fundamental of product management is that if there’s no customer problem, no matter how obscure, then no amount of investment, innovation or effort will assure success. There needs to be a gap in the process of a common, frequent or soon-to-be-frequent workflow for individuals, groups of people or businesses that would be better off closed. Better yet, the target customer knows of the gap, desires it to be closed and has been hacking the system on their own in one form or another to get through. The secret here is that the more visceral and emotional (yes, even in B2B) the customer problem, the better a relationship with customers one can build and the easier it’ll be to build a commercially-viable solution. Nowhere in here is the comment “Wouldn’t it be neat if …”.
2. Do something that matters
Sort of an extension to number one, we entrepreneurs not only have a responsibility to solve customer problems but a duty to turn our attention to big ones. There is no question that while some aspects of life are better now in the 21st century than they’ve ever been before, we still have giant mountains to climb, together, be it social or economic inequality, the environment, disease, etc. In fact, it matters not what a founder chooses to pursue or why, but rather that they’re motivated by driving positive change through the use of their product. There is no better way to be driven by one’s customers to build a successful business in a sustainable way.
3. Pursue efficiency
If the mission of entrepreneurship becomes so critical to customers and the larger social fabric, and the risk of accomplishing that mission is inherently high in risk, then as founders we have a parallel responsibility of driving as much efficiency as possible into our own processes. Startups, be they independent ventures or divergent initiatives inside larger corporations, have precious little in the way of resources, capacity or runway. We need to put all their efforts into driving value out of their unique skills and assets, minimizing any reinvention of the wheel. In other words, if there’s something you think you need, be absolutely sure you do, then find some way to source it in an inexpensive, appropriate manner, particularly if such a service takes distraction and worry away: the more “black box”, the better. Don’t shy away from asking for help. Some may see this as a risk to ownership, but really the solution that the entrepreneur is building is not defined by technology or effort, but by the gap closed for the customer. That delivered outcome is far more important than what it took to build the offering. This leads to an interesting opportunity for companies seeking to close gaps for entrepreneurs themselves – doing very important work but facing potentially crippling risk.
4. Listen to customers
Getting past the first hurdle of understanding the customer and market problem is a monumental achievement, one many startups don’t traverse (especially if we realize that the problem definition is far more critical than just building something). But if one is fortunate enough to find themselves with a product to sell and customers who wish to buy it, then there is an arguably more complex and nuanced task ahead: that of not letting ego, sunk costs or preconceived notions muddy and slow the trust the customer has placed in the startup. The measure really is how easily your customers can articulate your value proposition (not what you’ve built, but rather what you’ve solved) in their own words. If they can, it means they are drawing meaning from it. If they can’t, it may mean that the problem is ill-defined, the solution isn’t ideally usable or not communicated in the way that resonates. The faster an entrepreneur can react to the dual dynamics of market dynamics and customer maturity, by listening, revising, and going back again to customers, the faster the flywheel of virality can turn, driving down customer acquisition costs, bolstering against competition and ensuring recurring revenue, opening the laneway to product expansion towards the customer’s next big need.
5. Build a great company culture
One cannot even hope to take on big global problems, build solutions that work and ensure customers engage with and evangelize those solutions without a tenacious, dedicated, diverse and talented team onboard. Company culture and alignment of a mission isn’t something shelved and put aside for some later time when the company is large enough to have hired an organizational development lead. Lack of collaborative engagement at the outset is just as much of a landmine as missing the right founder skill. These are hard, stressful tasks that an early stage company signs up for, and the process by which team members share their ideas, question each other, point out potholes, encourage wins and snap to action when the decision is taken can make or break a company. Diversity is absolutely a secret weapon here. If a founder wishes to minimize risk by ensuring that a larger number of possibilities are considered when plans are being made, she can be better equipped to do so with a diverse team incorporating different cultural, societal, educational, technical and philosophical backgrounds. The great thing is that the bolder your mission, the better the people you’ll attract to your company. We all want to build something great.
The world needs entrepreneurial spirits, now more than ever. Economies are becoming distributed and diversified, ideas and assets more readily shared, startup ventures are changing our society and large enterprises are seeking inspiration from them to drive more capital into this approach, because it’s the only way we will tackle the biggest barriers to our growth. It isn’t easy, but we are extremely lucky that fate chose to make the pieces of success in entrepreneurship self-reinforcing. The collaborative startup communities drive broader thinking and new ideas amongst the founders who earn the attention of the bravest customers and most innovative employees, and by helping each other, we can take on bigger, bolder things.
About Balaji Gopalan, CEO and Co-Founder of MedStack
Balaji leads business development, strategy and marketing at MedStack and is an expert in product management and building software platform ecosystem businesses across a wide range of industries. He is also well-respected startup educator, advisor and mentor. His proudest achievement comes as the lead Product Manager in the original skunkworks team that built and launched BBM at BlackBerry, now relied upon by millions worldwide.