Thousands of startups come up every day. This is a huge number by any standards. Another vital fact is – the world of startups is ruthless and turbulent. Hence the question arises how many of these startups manage to survive the turbulent ripples of the change that has hit the overall functionality in today’s business world.
Challenges are everywhere and startups specifically are hit really hard if not equipped or prepared well in advance as they have less cushioning as compared to other well-established businesses. It’s not something that is unexpected, startup founders are well aware from the very beginning but still some problems may surprise you. Unrealistic expectations are also a significant problem for startups.
In this blog post, we are going to elaborate about some of the biggest challenges faced by startups in India. Here are some of the main issues to watch out for, so you can plan and know what to do if they crop up.
The corporate world is quite intense. The margin of error is negligible in this fierce competition and keeps the startups on their toes all the time. No matter how great your product or service is, in order to survive, you must be aggressive to be recognized amongst the cluster. Moreover, the turf keeps on changing rapidly with entry of new rivals. So, you have to put yourself in potential customer’s place and keep on revisiting questions like, what makes your company different, how’s your service/product special, what makes you unique, why would someone choose you? There should be a balance in defining yourself, it shouldn’t be just with regards to your competitors, it has to have a soul of ‘self’ also. You should be able to brainstorm and have the right strategy. Your ability to adapt in new settings define your success or failure.
Startups should plan comprehensively on all the aspects of their business which they can think of and have solid business plan. Many startups fail to hold and fade away because of lack of planning or leaving a few bases unplanned. The vital aspects of business-like recruitment, skills shortage, sales, development and funding should always be a part of business plan right from the start. Also, you can’t prepare for every contingency, but you should be prepared for unexpected turns. Optimism is good but if you fail to allow for surprises then you should be aware that you are heading for big trouble. The big point here is you should not leave details for later.
Success is always accompanied by expectations, which may seem realistic. But the problem here is after an initial booming success most startups tend to set ‘inspired expectation’ which turn out to be unrealistic. Startups need to interpret the real expectations as we know that sustainability should be a priority given that it’s the bottom line for any business. Consistent efforts are required to be counted in the game. Hence, startups should certainly have high but controlled and measured expectations keeping in view the market factors, the resources available and the magnitude of probable growth.
For any business to survive and grow, certain skills are crucial and knowing these skills need and getting on board the right people possessing them determines the success of any startup. The synergy of the team defines the culture of an organization, especially a startup. Individuals with similar capabilities and identical focus forms a cohesive team. So, it becomes imperative for a startup to hire suitable candidates which leads to creation of successful team culture and a successful organization. A wide pool of talent is available in the market and selecting the right candidate is a tricky task. Any delay in this process of finding the right talent is costly. On the other hand, making a haste and hiring the wrong person creates bottlenecks and stalls many things in the company. So, you have to lay out a hiring strategy right in the beginning, each role has to be carved to fit the goals you want to achieve.
For any business to stay strong and succeed, partnership has to be well founded. Many a times it happens that the very same people who nurture an idea from nothing to a business may become the reason for its downfall. In the ever expanding and volatile digital era it’s a herculean task to find trustworthy partners. Its highly rewarding for startups to get into partnerships, but you need to contemplate varied aspects before making any decision to collaborate. You need to have your investor presentation and pitch deck in place to attract investors. Startups should look for partners that have a sound presence within the market and also good reputation amongst industry giants. Another key point here is that the founders should not make the mistake of thinking that they can do it all alone. you should hire executives who can fill in the gaps in your knowledge and you should spread the workload keeping only the critical decisions for yourself.
Money is the most important input for a startup, unless you are amazingly lucky and cash flows in straight away, money is going to be an issue sooner rather than later. With the increase of income, expenditure also increases. Financial management is the most predominating challenge for startups. Financial forecasting, valuation, budgeting are the things that startups should focus on. Startups rely heavily on financial backup from the investors. Cash flow issues hit hard delaying important processes, so proper management of finances is a real pressure for startups. In order to tackle the financial situations, startups need to play cautious. So, financial advisory and startup consultancy services are the best help in managing financial crises and maneuver the tight spots as these agencies provide you with financial modeling and financial analysis with financial forecasting to help you take sound decisions. They give you CFO services along with accounting and bookkeeping. All the data analysis is done for you to take decisions accordingly.
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