Of the hundreds of thousands of digital startups that will be founded this year, the vast majority of them will fail. According to CrunchBase, the two most common reasons for startup failures are “no market need” and “ran out of cash” – two outcomes that could have been prevented with more concrete planning.
Entrepreneurs cannot operate quickly and efficiently if they need to learn every business discipline from scratch. That’s why the most efficient entrepreneurs avoid reinventing the wheel by learning best practices from other successful entrepreneurs. By adopting best practices in each startup discipline, founders can save their time and creativity for problems that require their unique perspective, which increases their overall chances of success.
Founder Best Practice #1: Build Your Knowledge Base
Best practices consist of proven methodologies for executing on a specific task. Founders should take advantage of the vast wealth of startup knowledge that exists online in order to quickly get a sense of the different areas that they’ll need to master moving forward. Sites like Quora draw experienced founders who answer questions about everything from hiring processes to developing an MVP.
Founders should additionally seek out other founders with relevant backgrounds who have already experienced success. Selective networking with entrepreneurs in your vertical is a great tactic to use when you’re looking for specific answers related to your industry or stage of development. Experts are more willing to help out when you approach them with questions that are highly focused and demonstrate that you’ve researched a given topic.
Founder Best Practice #2: Create Killer Documentation
When I talk to founders who are struggling to build software applications, I have them imagine building a house. I ask them to consider whether or not a team of builders could construct a house using only an initial sketch, without any detailed blueprints. Despite hearing this example, some of these same people go on to make similar mistakes while building their products. They briefly sketch out their ideas and then expect programmers to build their software, without more specific instructions. The products that result are delivered over-budget in twice the allotted time and aren’t reflective of the founder’s original vision.
When building a startup, founders should use best practices to create documentation before commencing any type of build. By creating documentation like functional specifications documents or wireframes, founders will find it much easier to measure their progress and deliver according to their plans. You can use templates or other entrepreneurs’ examples while creating documentation to ensure that you aren’t missing out on crucial aspects of planning.
Founder Best Practice #3: Follow the Order of Operations
When founders follow best practices, they’ll find that there is often a specific order in which tasks should be completed along the development timeline. This means that you should first map out a blueprint of your high-level tasks, and then figure out the order in which you need to fulfill them.
For example, before developing a piece of software, you would determine your branding personality so that your product will reflect the company’s desired branding mission. After you build your product, you should write a marketing plan before spending any money on advertising, which means that you would set marketing objectives, define metrics that influence those objectives, and establish procedures to track your acquisition efforts. When you’re ready to sell the product, you should set the characteristics of your target customers and price points prior to prospecting. By understanding how and why you’re building your company according to a particular timeline, you can ensure that you’re prepared to tackle each new discipline that you set out to conquer.
Founder Best Practice #4: Do One Thing Well
I’ve often thought back to when I started my first company, sixdegrees, in 1996, and the advice that I wish someone had told me upon starting out: just do one thing well.
At the core of every new digital business is the proposition that this business will do one thing that is unique, or one thing that is better than the competition. The difference might be found in the service, the product, or the marketing. If you can learn how to manage your company in a way that is consistent with best practices established by those who came before you, then you can spend most of your creative energies harnessing the power of your unique proposition.
Image credit: CC by john.schultz
