Starting a new business can be an exciting and challenging experience. While many entrepreneurs have big dreams and ambitions, the sad reality is that a large percentage of startups fail within the first few years. However, carefully planning and implementing some key strategies can increase your chances of success. Find out here some of Beamline Accelerator's essential steps to guide you in starting and growing a startup that survives!
1. Improve your networking skills! Warm contacts might be super precious. A cleantech startup, fresh from the womb or already established as a company, requires a good community (and, of course, a network) surrounding itself as cleantech is not an ordinary kind of startup. Indeed, the regulative push, for example, drives many problem-solution-based startup companies. To understand its technology potential and the real need in the market, understanding the context where the startup is operating is important. There have been people doing similar things before - learn from their mistakes & experiences. Cleantech startup founders are the most precious contacts of them all, with the potential of some becoming your partner in another grant proposal or supply chain wise. Suggestion: get into a strong community of startups and those that understand what you need for understanding the context of your business area. Warm intros to such are super precious, since through these you can make sure how your new professional contact can be helpful for you in upcoming years. And vice versa as well of course ;)
2. Aim for the stars. With your technology’s impact. Cleantech has to deliver, there’s no other way around it. Be a “painkiller” not a “candy”. Solve a problem that people are willing to pay for. If you’re a founder working on sustainability, know that your ambition is what translates your techs’ impact and financial returns. Being greedy in this sector? No, there’s only being impactful that counts! Thus knowing your environmental impact as clearly as possible should be among the 1st steps in your action plan.
3. Don’t be afraid of NO. We’ve seen startups who will get cold feet after a couple of no’s from investors. But actually, no can be also valuable feedback and there’s a huge learning point after every NO. Remember, behind every no there’s the reason WHY they are saying no. This is the point you’ll get the understanding of how to move on, whether to provide more or better info about your idea and startup. PS! Investors often don’t want to say no and sometimes meanwhile you are waiting for the answers from one investor, other great and effective deals remain undone at the same time.
4. Build a strong team. You can't do everything on your own. You need a team of talented and passionate individuals who share your vision and can help you bring it to life. Hire people who are committed to your mission, have the right skills, and are willing to work hard. Every core team member must have their own dream and ambition. And quite the key here is: hire top-notch people to your team, no matter if they are expensive because they bring back multiple times the revenue! Especially, in the very early stage, the founders' faces are the brand for the startup! We’ve seen a lot that startups don’t fail, the team just gives up too early. The advice is that with a strong (and synergetic) team you can always change the direction, always test something more and pivot. Pivots are making every team stronger because they are a sign that you’ve done a thorough client analysis and know their needs better than anyone. I would/we would go even a step ahead and say that your aim should be to pivot - if there is no reason to & your proposal stands the ground from the 1st days on, then you’re among the very few.
5. Assumptions are the mother of all f*ck ups. This sentence was originally stated by Eugene Lewis Fordsworthe, an American political scientist, but perfectly applicable to the entrepreneurial context as well. When we make assumptions, we are essentially filling in the gaps of knowledge with our own beliefs or ideas, which can often lead to misunderstandings, miscommunications, and mistakes. Therefore, it is always better to seek clarity and confirm any assumptions before acting upon them, in order to avoid any unnecessary consequences. Before you “run too far”, make every reasonable effort to check your assumptions. One way how to do it is to talk to people - there’s always someone who’s more experienced than you in some areas. Doing that, it’s important to understand whether their critique is grounded or they just want to be smart.
6. Get fit! “The product-market fit” fit! Having no product-market fit is often the no. 1 reason why startups fail. The product-market fit refers to the extent to which a product or service satisfies the needs and demands of a particular market or customer segment, so you are in a constant need to test the market and customers. Achieving product-market fit is essential for the success of any business, as it ensures that the product or service is providing value to its target audience. It involves conducting market research, gathering feedback from customers, and adapting the product or service accordingly to better meet their needs. Once a product has achieved product-market fit, it is more likely to experience growth and success in the market. Meanwhile, a product that does not achieve product-market fit may struggle to gain traction or may fail altogether.
7. Choose your investors wisely. Investor relationships might be a stronger connection than marriage. But choose your investors wisely, because once the relationship goes sour, it can be more difficult to get rid of an investor. Like in a relationship - it’s a matter of two-way contribution, therefore, it's crucial to build strong relationships with your investors, communicate effectively, and ensure that their goals align with yours. A great investor can provide valuable insights, resources, and connections that can help take your business to the next level. Remember, it’s often the practice that for first investment rounds, you should go through at least 200 investor contacts to get 1 deal locked. To get 200 warm intros is a heavy load of work.
8. You usually learn more from failures than successes! This is because when things go wrong, you are forced to take a closer look at what went wrong and why. Failures can highlight areas that need improvement, provides valuable feedback and teaches us important lessons that we can use to improve ourselves and our work. This is why it is important not to be afraid of failure. Instead, we should embrace it as an opportunity to learn & grow. Embracing failure as a stepping stone to success can help us overcome fear - don't be afraid of failure and use it to achieve even greater success in the future.
9. Apply for grants! Grants - the easiest and “cheapest” money you can get! With investor’s money, it makes sense to make such expenditures, which have no resale value. For instance, the building can be sold at a later date and is liquid on the secondary market, that’s why it could be financed with a loan instrument, as the investor's money is the most expensive. Unlike loans, grants are non-repayable, which can be a significant advantage for those unable to secure traditional funding through loans. Also, as grants support innovative projects and ideas that may not be widely known, this can be a possibility to gain recognition and credibility.
10. Stay flexible and adaptable! The business landscape is constantly evolving, changing, and businesses need to be able to adapt quickly to remain competitive. Staying open to new ideas and being willing to pivot when necessary can help you to stay ahead of the curve. Additionally, taking calculated risks can lead to new opportunities and growth. Remember the golden rule: the solution must not be more expensive than the problem.
Being a hardware startup might be tough (due to larger capital requirements, right?), but it might not be either. Depending on whether your startup is pursuing grant funding (which is so available in the EU, for example) and bundling venture capital along with it, which, in the long run, creates a good foundation for getting up, validating, piloting, and scaling. Also, cleantech-specific VCs tend to dig hardware. If they understand it, and the best ones usually do. Bear in mind though, that if you’re chasing after the dedicated VCs, their target indicators for your tech to work as it should (kWh/t CO2eqv saved, for example), are specific and the bar is set high.
Starting a successful startup is not easy, but with the right mindset, planning, and execution, you can achieve your goals. Remember to stay focused, stay positive & never give up!
Beamline Accelerator is from the land of the unicorns, a topic-focused accelerator, where we offer a tailor-made approach to each startup, delivering services and networks to fuel organic growth.