In 2017, over 589,000 start-ups were launched in the UK. That’s 67 start-ups per hour. Now, some of you will take great solace in this fact, but for those of you still unsure, let me say this.
Taking the leap of faith into start-up life is one of the hardest challenges you will ever face. It’s an adrenaline-filled adventure and it’s worth every ounce of the risk.
Taking the plunge
For me, there was no other option than to work for myself. I worked in my Dad’s music shop from the age of 12 and straight away knew that I wanted to create something of my own. I saw the joy it brought my Dad. The pride in his face and the knowledge that he owned his own fate.
So, when I was 19 and the opportunity arose for me to run the music business full time, I couldn’t say no. With little hesitation I dropped out of university and prepared for the next phase of my life.
I didn’t just want to continue the business; I wanted to transform it. Taking inspiration from Amazon, I shifted the business to an online marketplace with warehousing facilities, a sales team and a music school.
I understand that this is not the typical founder journey. In fact, with the average age of the UK founder being 47, it’s far from it! But no matter your position, one consistent piece of advice always applies. Work out the opportunity cost before you start.
Some factors to consider are:
Your knowledge of the industry: Are you an expert in the field? Do you have an existing network you can tap into? Do you know the market and your competitors?
The opportunity in the space: Are you providing a scalable solution? Is the market saturated? Are there similar companies already in existence? If you are starting a small lifestyle business this is less important, but it’s still vital that you have an understanding of the space.
The impact on your life and those around you: Are you in a place to risk making less money for a while? Are you willing to sacrifice your social life? What will be the impact on your family?
And the golden question…
How/will it generate revenue? Your idea must be profitable. If you can’t generate revenue, you can’t exist. Too often we see founders relying on investment for survival. Although great in the short term, this process is unsustainable and will be the downfall of their business.
Removing your blinkers
A study by CB Insights last year found that 42 per cent of start-ups fail due to lack of need. I often see founders caught up in their own idea. They build a product based on personal assumptions rather than what the market actually wants. Nine times out of ten, these are the start-ups that fail.
The solution? To objectively evaluate an idea before committing to your business. There are now hundreds of free tools and hacks online that can help you validate your business idea. However, for a more robust approach, you can join a start-up studio, which can provide you with unrivalled insights into business concepts and get you ‘investor ready’ within a matter of weeks.
The best founders continue this flexible mentality, throughout their business. If their business model stops working, they create a new one. Great companies like Instagram, Groupon and Paypal wouldn’t be here today if their founders were afraid to pivot.
You don’t need to know how to code to build a tech business
There’s a common myth in the start-up world that the top tech businesses were all created by tech wizards. Coders who built their product from the ground up one line of code at a time. Then boom! success, money, fame.
However, the truth of the matter is far different. Take Brian Chesky (Founder of Airbnb), Sean Rad (Founder of Tinder) or Michael Dell (Founder of Dell). All three of these founders didn’t code their own business. Yet, all three built some of the most valuable tech businesses of the last decade.
These three powerhouses are more than just a snapshot of the success of non-tech founders. They are definitive proof that it doesn’t matter if you lack tech expertise, as long as you bring other attributes such as vision, ambition and desire, you can have a successful tech business.
Is a utopian start possible?
Start-up life is unpredictable and addictive. It’s part of the reason so many people love it! But this unpredictable nature means that founders you will face a few curve balls on your journey.
When I started ucreate, our first customer didn’t have the funds to pay us. When I started Umbrella Music, I had issues with web development. These challenges are part of the start-up landscape.
Ultimately, it doesn’t matter if you bootstrap or gain funding, if you outsource your work or do it all yourself if you find a CTO or team up with a start-up studio. You’ll always face unexpected surprises and hurdles that are out of your control.
Great entrepreneurs roll with the cards they are dealt. When life doesn’t go their way, they learn a lesson. It shapes them and their business. So a utopian start probably isn’t possible… But there wouldn’t be world class start-ups if it was.