Start-ups as we know it are new businesses that enter the market with an ambition to grow and prosper beyond the solo founder, unlike entrepreneurship. Every business that is formed requires a new idea, something different than the existing market. However, as Bill Gross explains, an idea is not the only reason new businesses succeed or fail.
Start-ups have the potential to change the face of the global economy and have it thriving. The following insights have been studied by Bill Gross, founder of Idealab, which has founded more than 100 start-ups.
Let’s look at the 5 reasons he gives and what the single biggest reason is behind the success of a fresh company:
- Timing
Timing builds the bridge between success and failure. Some ideas are beyond exceptional like that of video content and creating a video-sharing platform, however certain companies like Z.com failed because of poor timing, while YouTube barely had any of the other factors except for exceptional timing and we all know where it stands today.
- Team and execution
A good team will tell you where you go, the right people in the right positions can be your mirror. If there is no one to tell you about the strength and weaknesses of your company, chances are you will remain still. Building a good team is one of essentials to a successful start-up along with well-planned execution.
- Idea
It’s a surprise how idea falls third in this category. This clearly doesn’t mean an idea is not essential but just that timing precedes them all. The idea definitely matters a lot but if not executed at the right time it could be fizzled. For example, YouTube was a great idea with no business model, but it was perfectly timed to reach these heights.
- Business model
Some companies/entrepreneurs never have a business model before starting a company and they still do exceptionally well. You can always build a model later on when consumer demand increases. So, it makes sense that its not one of the most crucial points in the success of a business.
- Funding
Finally, funding. In the initial stages of your business its acceptable if you are underfunded. According to figures, entrepreneurs can begin a business with merely $10,000 and that is not a very huge amount. In today’s modern age, its incredibly easy to receive intense funding especially for start up companies.
Zainab Ujjaini
