By One way to tell a newbie aspiring founder from a seasoned veteran isn’t in how much they make with their ventures, but rather with how they assess and decide on which new ideas to pursue. In reality, it’s not a good idea to judge a startup’s performance or potential using numbers on the table regardless of whether the numbers actually reflect profits — is a simplified and terribly flawed strategy.
Stickiness
I don’t know how many entrepreneurs have pitched to me “great” ideas that all are based on a one-time purchase, says Raphael Sternberg. Although I’m not saying that patents are worthless or that you cannot make money or be successful from the one-time purchase of a service, it’s not an ideal or most efficient option (unless you’re selling at a premium price).
Here’s why
The expense of acquiring customers usually isn’t cheap. So the likelihood of your success is dependent on the one-time purchase’s profits over the expense of acquiring this new customer, and then you’re walking an extremely fine line.
It’s usually cheaper and simpler to keep a satisfied customer or to upsell them onto more products and services than to acquire a brand new cold lead, and then convert them into a buyer
If you’re planning to build any kind of tech product or service I’d say the need for stickiness is an absolute requirement to succeed. Why? Because regardless of whether your technology product is based on the basis of B2C revenue or B2B advertising revenue generated due to your large volume of clients, continued performance and financial success require that these users continue to use your product or app platform.
This is a reason why digital platforms try to gather your personal information even if they do not sell it. They can make use of your previous information and interactions to make your next customer experience more personalized pleasant, efficient, and convenient and, in turn, cement your status as a frequent customer.
If you’re able to create an item or service that records previous preferences of customers or feedback, purchases or actions and then use it to enhance their experience in the future and experience, you’re halfway to creating a lasting company that draws customers to return on a regular or weekly basis, with the intention of keeping them for years to be.
Trends
If you believe you’re creating your business in a void, insulated from, and shielded from the market or economic developments, I’d think that you’re facing an unsettling reality. But even if current trends in the industry may not initially appear to be favourable for you does not mean that your plan (or trying to implement it right currently) is a failure. Actually, you might be in a position to make use of the same patterns that make competitors nervous for your benefit when you’re savvy sufficient…
In this case, if for example, the business is in an infrequent lull (thanks to the recent recession that is slowing sales and frightening competitors) It could be a suitable time to jump in when competition is less (and less resource-stretched) than usual, however, customers’ issues remain present.
But, certain trends suggest an industry that is dying or a dramatic shift in consumer behaviour that may not be favourable for your business, so it is important to keep track of these indicators prior to going full-time.
Replaceability
Imagine establishing a business in the hundreds or tens of millions and then being replaced in a matter of hours by a business that replicated your products or services without you having to pay a cent. If you don’t own a patent or defensible, proprietary technological product, that isn’t just possible, but it’s most likely more frequent than you imagine.
Some might say it’s the fault of the smaller business for not constructing larger moats with greater recognition of its brand and loyalty to customers Some would argue this was a missed opportunity to acquire (to offer the company to an incumbent). While both are possible however, the best line of defence is of course to design something that’s easy to replace and could be in danger of being a target for an ambush at any moment.
Access
Whatever great your concept, product or service may be one of the major challenges that entrepreneurs have to overcome is getting their idea into the hands of the correct audience. Connections and simple access can prove useful a benefit to those with connections. It could be connections to the industry from a firm you were once employed by, or work for, a friend or a relative you can poach for a board or advisor or even a team member that is directly connected to your target audience Access points may be the key to launch your venture with the utmost success.
