5 key ingredients for startup success

(Editor’s note: Tod Whipple is a serial entrepreneur and the founder of StartupAddict.com. He submitted this story to VentureBeat.)

So you found the next big idea and think you have the startup chops to execute it. You’ve already figured out how to bootstrap your startup your venture, calculated the burn-rate and crafted a game plan for the next 12 months. Now what?Take a step back, cleanse your palette and prepare to digest five key ingredients for startup success. Like any good recipe these ingredients are not mutually exclusive but will enhance the overall dish of success.

1 cup of startup team (well blended) – People will be the single most important asset in your startup. Going beyond the resume and looking at work ethic and attitude is paramount. Selecting people that gel with your startup team and culture is imperative to surviving the inevitable bumps along the way.

Passion and attitude should be just as important as skills. Be sure to assess your own skill set and determine where your time should be allocated and then supplement with top notch personnel accordingly.

Stay true to the lean startup methodology and do not hire prematurely or bloat your burn-rate before you have a road map for the other four ingredients.

Heaping portion of market fit – Understand your customer’s problems and build a solution around them. A lean startup needs to be able to bring a product or service to market in a timely manner and get customer feedback as soon as possible. Listen to your user base and make adjustments. Ensure your product is simple and easier to use than your competitors. Presenting a dramatic improvement to existing products to solve a not so obvious problem will help tremendously in achieving a market fit.

If you are looking for a quick litmus test before you release your product check out a company called GutCheckit. It’s a DIY online research tool that connects you with your target demographic on the cheap.

1 prototype (raw) – Testing a concept is where the recipe for success either turns into chocolate decadence or a deflated soufflé This will undoubtedly be your most expensive part of the lean startup process. Don’t shoot for the Moon on extensive features and bells and whistles.  Produce the bare minimum possible and offer the simplest solution to the problem you can. If you are embarrassed about first product release, you probably did just enough.

2 scoops of metrics – Customers are the bloodline to any business and their feedback is invaluable. Understanding them is less about marketing and more about metrics. Once your prototype is out in the marketplace, utilize every tool at your disposal to watch, learn and listen to your customers. If you are a web-based startup, utilize real-time analytic programs like chartbeat and heat map providers like Crazyegg to tweak your UI. You should be looking for one thing: Are the users staying on your site? And if so, are you retaining / converting them?

Dash of pivot – Listening to your users is only half the battle. Understanding how to incorporate feedback to enhance your startup and better serve your customer is the challenge. Steve Blank’s customer development methodology is founded on gaining an understanding of your customers’ problems and needs, and then tweaking your product as necessary to address customer demands.

Eric Ries who is wildly known for coining the pivot phrase says “The idea that successful startups change directions but stay grounded in what they’ve learned. They keep one foot in the past and place one foot in a new possible future.” The takeaway for this ingredient is to be flexible to your customer needs while maintaining your original vision for your product or service.

  • http://pulse.yahoo.com/_LT3PAU5FSRGMK3TOQNNU7MZC4A Equityman

    Very good article. Having started a few ventures online I'd agree with this author's advice. It is succinct and spot on.

  • BillReichert

    Fun article, but it reflects a distressing sign of the times. No suggestion that it's important to have anything unique, or that you need a sustainable competitive advantage. Team attitude and organization culture will carry you through. Ship and pivot — that's all it takes! Domain expertise and proprietary technology are so last century.

  • http://www.brandignity.com Brandignity

    Good stuff, you really have to surround yourself with the right people but most importantly you need to know how to roll with the punches because there will be many when you first get going with your business.

  • http://blog.startupaddict.com/business-musings/how-to-execute-an-idea/3090 How to execute an idea | Startup Addict Musings

    [...] might be consider it worthless without proper execution. The real maneuver is how well you execute ingredients that make startup success. The real innovation occurs when you take an idea and figure out how to make it simple, intuitive [...]

  • http://www.freeenterprise.com/recipe-for-small-business-success/ American Free Enterprise. Dream Big. | Recipe for Small Business Success

    [...] Venture Beat created a list of five key ingredients necessary to make a business profitable. The recipe for success calls for the following: “1 cup of startup team, a heaping portion of market fit, 1 prototype (raw), 2 scoops of metrics and a dash of pivot.” Like other recipes, the ingredient portions can be tweaked per the entrepreneur’s preference. [...]

  • http://notsuno.ninjintaro.info/tamonetsuno/t1647.html スタートアップの成功に必要な5つの鍵 | Designing Solid » タメツノ

    [...] スタートアップの成功に必要な5つの鍵 | Designing Solid タメツノ Add comments 11月 032011 これはスタートアップの成功に必要な5つの鍵 | Designing Solidの検索キャッシュです。削除の依頼はコメント欄から受け付けております。 5 key ingredients for startup success                   あなたがウェブベースのスタートアップであるならば、chartbeatのようなリアルタイム分析ツールや、   スタートアップをより強いものにし、より一層顧客に役立つようにフィードバックを取り入れる方法 Steve Blankのの顧客開発方法論はあなたの顧客の問題とニーズの理解を得るということに基づい5 key ingredients for startup success [...]

blog comments powered by Disqus