According to the Global Entrepreneurship Monitor, there “are about 300 million people who are trying to start 150 million businesses worldwide. One-third of that number are to be launched, and there are about 50 million new businesses each year, which leads to 137,000 startups made per day.”
Suffice to say, startups are having a moment. And have for a long time.
The reasons for this are myriad.
Not least that entrepreneurship has been branded as… well, sexy.
These are not the results that show up when you run a similar search for the perception corporations have in the world.
Starting a business is not the same as running one
However, while startups may be sexy, running one is not.
And here’s where the big Fortune 500s have a thing or two to teach the newbies on the block.
That figure of 137,000 businesses being started every day is impressive. But it’s only one side of the coin.
According to the same report, “an estimated 120,000 businesses are terminated each day.” (This data represents global statistics.)
Most startups fail to grow after raising seed funding. So although many startups are being created at any given time, many are also exiting the market too.
Because running a startup is running a business.
Without the right planning and execution, success will not follow.
Corporations have planning and execution embedded into every process within their organisation.
And implementing some of these lessons, from businesses perceived as far less agile, is a valuable exercise for startup founders to conduct.
The value in the following four tried and tested corporate strategies give startups insights for the foundations they need to build for a robust growth journey.
Lesson #1: Prioritise setting up an operational structure
Corporates have org charts detailing the structure and demarcations of their various departments.
This can seem unnecessary in a startup with fewer employees.
However, your startup does need an operational structure.
Each employee in a startup makes a significant contribution to the overall success of the business. A clearly defined operational structure will provide clarity on the expectations they are needed to fulfil and help them execute well.
Your operational structure will also be key to your scaling blueprint.
Lesson #2: Implement changes strategically
If I had a dollar for every time I’ve heard that word uttered by founders, I’d be on my yacht right now disrupting my daily routine.
Startup culture reveres disruption.
To such an extent that I’d now argue the term has lost meaning in most uses.
Change has implications.
This is true for your customers and your team.
Within your startup, eliminate making changes that have not been thought out and planned for. Reverse engineer what the change is you wish to make and understand all the ramifications of this.
For example, don’t simply introduce new software solutions for your team to do their jobs. Create a software release management procedure that gradually introduces the change and doesn’t disrupt the daily routine your staff rely on.
This is how the corporates do it and there’s something to learn here.
Lesson #3: Create a brand identity – vision matters
Every corporate on the planet is driven by a set of goals. Yes, they’re in business to make money and provide shareholder value.
But to achieve this they need to articulate a vision.
This is not Marketing gobbledegook.
Without a vision, potential clients will not know how the organisation can solve their problems.
This is how corporates create a unique positioning for their brand.
Once the excitement of founding a startup wears off, reality sets in.
And the reality is that money needs to be made.
I’ve seen many startups, often with interesting ideas and propositions, react by doing anything to generate revenue.
This is the exact opposite of creating a vision.
Now, creating a vision and crucially, sticking to it, can seem inflexible. But this is the structure needed for growth.
Without this structure, chasing revenue by distributing the resources and energy available will lead to spinning wheels.
Stick to the vision for your startup. Just as the Fortune 500s stick to theirs.
As your startup grows, you can revise your vision and mission statement to encompass larger goals.
Lesson #4: Bring HR onboard early
If you want to grow your startup, you need the right talent.
No founder grows a thriving startup, and then scaleup, on their own.
Hiring and retaining staff is expensive. Hiring and retaining the wrong staff even more so.
And make no mistake about it, the market out there for talent is fierce.
In my opinion, what we’re calling “The Great Resignation” is really people deciding for themselves how they want to engage with the labour market.
Suffice to stay, we’re way past the Pizza Fridays mark.
Corporations invest in their HR teams. Startups should do the same.
Bringing an exceptional people operations person into your startup is not something to consider once you’ve raised Series B capital.
Corporate strategies are crucial for startups
I champion startups and scaleups. It’s invigorating to work with founders.
But I insist on stepping away from the clickable headlines and instead getting into the nitty gritty of what growth actually entails.
The truth is that, alongside incubators and accelerators, corporations have a lot to teach startups.
Keep your focus on innovation.
But know that innovation will not survive nor scale in an environment that has not been operationally prepared for it to do so.
So take a leaf out of corporate’s book.
Now that’s sexy.
This article was originally published on Irish Tech News on 12 August 2022