Let’s understand this – start-ups that sustain for more than 2 years or so without any meaningful success may well have been caught in what is called ALMOST THERE stage. In this stage start-ups hang between the failure and success. If they continue in this stage beyond a point they would ultimately fail. This is a tricky stage and one that, if not managed well, can doom the start-up. You have some clients and less than decent revenues that keep your hopes alive but you keep burning your resources to get more clients and revenues without much success. Or each additional rupee that you spend gets you less than a rupee in revenues. Or you simply could not convert potential customers to paid customers even after highly encouraging early responses from them for your product. The reasons could be any or many. From an emotional angle, the entrepreneur keeps hoping to get past such stage but the start-up really remains stuck unless it executes a responsive plan.
It is the entrepreneur whose capabilities will be tested at this stage and whose decisions would finally decide which way the start-up goes from here.
Firstly, the entrepreneur must be mindful of this stage – there is something that clicks in your offering but there is equally something else that is keeping you from success. One must cautiously yet swiftly work to move out of this stage with impactful decisions based on deep understanding of stakeholders, insightful analysis of different elements of product / service, timing of the idea and similar other stuff. For example, there could be an issue of cost structure or pricing since as the start-up increases revenues it incurs more losses. Go through the cost structure or pricing bit by bit and take necessary decisions to optimise cost or pricing or both. There could well be an issue of sales team who are unable to absorb feedback from the customers and use the new found knowledge while selling. This may lead to stagnating an already small customer base.
The entrepreneur must create the processes and ways to ensure that customer feedback is preserved and rigorously analysed to fine tune product, sales, and other strategies.
Reasons for this stage apart, the purpose of this blog is to highlight that start-ups are prone to this stage. But the good news is that with informed and guided decisions the entrepreneurs can get past this stage sooner than later and meet the success that eagerly awaits them on the other side!
For this reason, the course design (academic and non-academic) at TES exposes the student entrepreneurs to a variety of such scenarios and prepares them to come out of these scenarios victoriously. I invite the reader to meet one of our Admissions Team members or me directly to understand more about TES’s course curriculum and the program design.
*The period of 2 years may vary depending on the nature of the industry the start-up operates in. The range can be 6 months to 5 years or more but the trick is for the entrepreneur to define this period.
by Masroor Lodi