The Most Important Reason Why Startups Succeed — Mentor Monkey
Startups have held the intrigue of countless aspirants, fresh from with their college degree and hoping to emulate innumerable others before them in rising to prominence with a single world-beating idea. Their intention is precise, but their path is paved with uncertainty as there is no true tip to succeed in an industry that only rewards persistence. The single biggest reason a Startup succeeds is something that has eluded every major aspirant hoping to one day start their own Facebook or get the attention of a giant and sell their very own WhatsApp.
Let’s dive into this great TED Talk.
Let’s have a look at a speech made by a modern pioneer in the Startup industry, the distinguished Bill Gross. He made this speech at an event hosted by TED where he shared the information and the knowledge he compiled through years of market research. He looked into what makes the successful companies tick while evaluating the reasons for the downfall of others, information which he has compounded with his years of experience in the field to devise a tried and tested stratagem that exemplifies simplicity while providing much-needed insight into the workings of a successful corporation.
The findings he has shared as a product of his comprehensive analysis of these top companies show us a pattern clearly emerging among the elite organizations of the world. He shares the secrets of the success of these companies and has made these “secrets” accessible to any aspirant hoping to make it big in the industry. He believed that Startups were one of the greatest forms to make changes in the world.
Getting together the right group of people, giving them the right equity and resources, could in fact change the world according to Bill Gross. He concentrated on how Startups, possessing all this ability still failed on some levels. His findings resonate with the dominant ideology in successful businesses and we can look at the primary reason he provided for the success of Startups.
Startup ideas are not the only factors.
Although ideas are at the center of a Startup and are what drives it forward, it is not something that the success or failure of a Startup hinges on. But in lieu of the experience on the field, we can see even foolproof ideas cannot be executed without a proficient background team to back them up. So we have established that proper management and execution matters more than an idea.
So what is important? What drives a Startup to success?
One can look at the incredible amounts of funding some companies receive. But even funding or a proficient team may just be on the periphery compared to what is truly important in the success of a Startup.
Of all the examples we have looked at, a certain quality and attribute have shone through among the biggest and best Startups and their route to success. This quality is timing. Timing is the one singular element that is responsible for the success or failure of your Startup. There are countless examples in this sector that show how vital timing is in the industry, completely changing the complexion of a business from a failure to success or vice-versa.
Bill Gross could make this conclusion based on carefully compiled data from companies at both ends of the spectrum, I.e. the massive successes and one which sunk without a trace. In a staggering revelation, stats clearly showed an incredible 42 percent difference between the success and failure of a company owing to just timing. This significantly trumps team skill, execution, or funding, which although important in the growth of a business, is not the difference between success and failure.
Let us take a case study that illustrates this fact.
Airbnb was a company that fell into the category of a wild card, and many top investors were hesitant to fund an unproven business model. Airbnb’s staggering growth has since proved them very wrong and one of the reasons for its success, including a shrewd business model and great execution is the timing of its launch. It came out during the recession, where money from any means was welcome and people were open to the idea of opening their homes up to paying customers. Thus with Airbnb, we have an efficient convergence of form, function, and timing.