I thought I would make millions through my startup, but I failed miserably. I read shiny stories of Flipkart and Zomato, but nobody told me that 90% startups fail within two years of starting up, I failed in the first year. Sometimes I feel being cheated but it my fault that I believed one side of the story.
I built an ERP product for schools and we attracted some customers but could not scale up the operations. I shared my bitter experiences with selling to schools. It was the failure of my startup but not me. I learned some of the great lessons even if my startup was not a success story. I wish to share few with you.
1. Know your customer before building your product
The point should be clear by now. We built our product based on the assumptions and feature lists of our competitors. We should have talked to our customers before building our product.
We should have convinced two or three schools of different size to test our product. In exchange, we should have provided a life-time free product and support for early adopter schools. We could have offered unlimited free SMS or something similar to save instant money.
2. Know where to spend money and where to avoid
We spent most of the money on office infrastructure and employee salaries. We could have avoided 80% of expenses by working from home and hiring employees on survival salary + ESOPs.
We were avoiding expenses on the professional design of sales material, marketing tools, and paid consultancy. We should have spent money on the things that translate into more sales or leads.
Now it seems no brainer but still most of first-time entrepreneurs are repeating our mistakes. If the primary source of your customer acquisition is your website then you should spend money on content marketing, sales deck, and sales pages. If you acquire your customers offline then spend money on sales brochures and other printed material.
3. Get your hands dirty with the code, even if you are a non-techy
Non-technical co-founders remain clueless of technical know-hows. They should not behave like a foreign client who just assigns work and expect to be completed by the technical team.
That did not work in my startup and it will not work in your startup.I advise you to start coding even if you are non-technical. There might be some exceptions (that we can discuss in later articles) but a non-tech co-founder can take better decisions if he knew how things get implemented.
If you do not have a tech co-founder and building a software product, then there is no exception. Joel, co-founder of Buffer share why non-tech co-founders must learn coding.
4. Do Sales, even if you are from non-sales background
I was afraid of doing sales because I thought my co-founder is better at communication and public speaking. We were unable to close sales despite his good communication and HR background. One main reason was that we were not talking about the pain points of the customer but just trying to sell our solution. The sales process is not just about good public speaking but addressing the concerns of the customer.
When I moved to Chandigarh, I tried sales in the local schools. I visited about 50 schools in one month and closed three deals. I learned not only the sales process but also got acquainted with customer’s real issues. You can build a great product with a better understanding of customer’s pain areas.
Disclaimer: I am not suggesting that all co-founders should be doing all the things at all the time. NO. They should be owners of their areas but at the same time they should have first-hand experience of all kind of jobs in a startup.
5. Take decision and trust your intuition
We became bad at taking firm decisions. We started postponing tough decisions like spending budget of sales, hiring or firing an employee, offering equity to the employees, chasing big schools or small schools, offering a free solution or charge premium, and at last how to separate our ways.
Since the closure of my first venture, I started taking firm decisions based on the available information at that time. You can never have 100% data available for taking any decision. You should be smart enough to derive a conclusion with 60-70% information and fill the gap with your intuition.
Trust me, I always felt happiness after taking a decision and sticking with it until I find a solid evidence to change my decision. That is how things evolve. If you are confused with your decision then you will not be able to execute with 100% confidence.
6. Don’t stop learning
Alarm bell rings in my ears when someone starts behaving like an expert and refuse to learn new things. You are doomed to fail if you stop learning.There are so many sources of my learning – I love to read books/blogs, I learn from my juniors/seniors, I learn from competitors/customers/vendors, and I don’t hesitate to learn from my three-year-old kid.
The biggest source of my learning is by experimenting with my startup and life.
7. Money is just a by-product of a startup
I learned it very late, but some of you might have realized by now. We entrepreneurs start a venture to solve a customer’s problem (or to explore our passion) and money is just fuel for our startup vehicle.
If you focus on money then you will become short sighted. You can make money in short-term but you will lose strength in the long term.
Focus on solving problems and keep your customers happy. The money will follow.
and Be Generous
The most important lesson from my entrepreneurial journey – Be Generous, Be Polite, Be a Giver.I always remember a beautiful line
“Be nice with everyone when you go higher in your life because same people will meet you when you come down.”
First give something to the world then expect something in return. It will be even better if you just give without any expectation. Help people who can not help you at this time, that is the real gesture of generosity.
[About the author: Pardeep is an Entrepreneur, who left his job to explore his passion in startups. He co-founded two startups in past. Now, a freelance writer, digital marketer and running a blog on personal finance – CashOverflow.in. He can be followed on Twitter@pardeepg]