Bangladesh has a huge possibility to develop it as a Startup hub in South Asia considering its steady economy with over 6% GDP growth on average per year, and total population of 164 million along with 107 million people below 35 age range makes Bangladesh one of thriving market for innovative products and services. Bangladesh Government is taking important steps with the help of private sector to establish startups operate business in global and domestic level. Although there is lots of initiatives and enthusiasm about startups in young professionals in the country, most are failing within 3 years into its operation.
To make your startup thrive, there are several crucial parts you need to consider before jumping into the venture.
Idea:
An idea even if it’s a good one won’t guarantee business success. It is depends on excellent execution not innovation. A good idea usually solves a problem adeptly without major drawbacks and profitable business proposition. If the good idea has no market demand for it and not cost effective thus making it hard to generate profit, it is not sustainable as a business. To find out whether your business idea is sustainable or not, you need to consider the following aspects
Your idea solving a common problem – The key is to have an idea which solves a widespread common problem, not introducing some new functions that nobody ever needed.
People ready to pay for your solution – imagine someone else came to you with the idea you have, will you buy the product or service from them? How much will you willing to pay? Answer to these questions will let you understand whether your idea has potential to make money.
Scalability – In order to thrive as a business, your idea must have an opportunity to grow in other markets, expand in other business models and functions to continue making money.
Your idea is unique – If there are other players in the market with better or as good as your idea than it is not sustainable.
Not easy to copy – You need to check whether your idea can be easily copied by the copycats and idea thieves with some subtle improvements. If it is so then you should rethink about starting with this idea.
Built to Last – Your business idea should solve long term problem with long term solution. The business should have the capability and capacity to last more than 3 years.
Team:
People make a great idea into reality. The startup leadership team could have co founders with complementary skill set – it is very important to have team members with in depth product knowledge, marketing and financial/fund management skill. Entrepreneurs and leaders are crucial for a startup success but it is the team who drives innovation, maintain business results and achieve goals. To make your business successful and sustainable you need to put right people at the right seat in the bus.
Business Model:
Suppose you are sailing with a target to reach a place within 2 weeks but you don’t know the direction and what is required to survive during the journey. What is your probability to reach your destination? It is almost zero. So you need to have a clear goal and action plan to reach your destination. A business model of a business addresses this purpose – it gives direction to how the business intends to satisfy the market need and generate revenue. You should be able to say “here is how it’s working now, but this is how it should be working.”
Timing:
Timing is the thin line between success and failure of the business. According to Bill Gross, founder of Idealab, 42% of startup success depends on the right time to enter into the market. For example, many investors rejected AirBNB business idea stating it was odd but it was launched during recession when people needed extra cash and that made them to rent out a room in their home to a stranger. Uber also launched during recession time when the drivers were eager to increase their income. Just see where these two companies stand now, both have highest market share in their industry.
The ideal matters a lot. But timing matters more.
Funding:
Cash flow is the bloodline for your startup at early stage. Adequate working capital is absolutely indispensable for successfully running business operation. Initial capital for the business may come from your savings and borrowing from family and friends. Try to avoid taking fund from venture capitalists and angel investors at the seed stage, since it may undermine your decision making power over crucial issues about the startup. Fund for the startup should be raised when you have some regular customers with steady cash flow, and you would like to expand your business to the next level.
Final Thoughts:
You should take mental preparation to run a Marathon race while you establish a startup as a business. Long term strategy is essential from product development to market demand creation, to make a startup business as great company. Persistence is required in face of adversity faced – a ridiculous product or service right now could be most sought after by the customers within five years time. It is about survive and being relevant till the market is ready for your solution.