Startups are literally an experiment, a journey into the unknown, always looking for opportunities to do something better by disruptive thinking and constantly questioning the status quo. They learn from their mistakes and fix them quickly as they continue their growth journey.
The startup organisation is one of the greatest forms to make the world a better place. If you take a group of people and organise them in a startup, you can unlock human potential in a way never before possible. You get them to achieve unbelievable things.
But if the startup organisation is so great, why do so many – up to 90% – fail? What actually matters most for startup success? Bill Gross recently looked at five factors potentially driving startup success: the initial idea, the team, the business model, the funding, and the timing. Here’s a link to his insightful TED talk: https://www.ted.com/talks/bill_gross_the_single_biggest_reason_why_startups_succeed
The number one thing driving success was timing. Timing accounted for 42% of the difference between success and failure. Team and execution came in second, and the idea – the uniqueness of the idea – came in third. It surprised me that the idea wasn’t the most important thing. Sometimes it mattered more when it was actually timed.
So what makes great timing for startup success? Timing for me is about taking limitations and turning them into possibilities. You can’t wait for timing, you have to create it, give yourself the opportunity. You can’t wait to see what might have happened.
Entrepreneurial founders are fuelled by passion and an insight or a hunch into the problem they are going to solve, but intrinsically startups work on being a bet – and it’s the timing of this bet that seems to be a factor in success. Timing is about judgment, intuition and foresight.
A startup leader has to be comfortable with taking on ambiguity, uncertainty and multiple challenges. What kinds of people chose a life of exploration, challenge and discovery where timing is a decisive factor in the outcomes they achieve? What do you think are the most important leadership characteristics of these ‘explorers’, and how do they impact the ‘timing’ as identified by Gross?
Here are the thoughts about the importance of timing on a startup leader’s actions and behaviours.
Vision A well-defined vision is the compass by which every startup journey is navigated, giving the focus to the direction of travel. Vision, driven by an instinct and with foresight for timing, can be a formula for success.
Flexibility ‘No plan survives contact with the enemy.’ This variation on German Field Marshall Helmuth von Moltke’s original quote could not be more true for startups. Leaders of start-ups need to be flexible to alter (or even throw out) plans as timing of product-market fit and market circumstances dictate.
Unwavering belief Every startup revolves around taking risks, but again it is the timing of knowing when to do so that is key. A combination of paranoia and utter confidence is needed, in order to hold your nerve so as to get to the carpe diem moment.
Speed It makes a difference when a startup is able to launch on time and able to move faster than competitors. Successful startups never delay the process of getting things done. The most productive startup leaders are the ones who make the most of their time. I believe that the faster you can make the mistakes, learn from them and improve your offering, the better.
Discipline Self-control and a strong self-imposed agenda in terms of getting-the-things-done-you-said-you-would-when-you-said-you-would, are important elements to timing. Self-discipline from the founder leads to a positive team work ethic to getting things done effectively and efficiently. When focusing on your first release, this focus is critical.
Time and ability for listening, reflection, curiosity and self -awareness Listening is a completely underrated trait. In a hyper-competitive economy, the person who speaks first – and loudest – is most often heard. But soliciting feedback and internalising what you hear will always make you a better startup leader. The best startup leaders have an acute sense of self-awareness; they know their strengths, and more importantly, their weaknesses. They are confident enough to be honest about areas for growth, take time to be curious about feedback, be reflective on lessons learned, and make timely changes to their business model or product as a result.
Time for the team Startup leaders who share good, bad, and ugly news to their folks with full transparency earn trust, and have a daily huddle with the team. Aside from this honesty, making time to share information ensures that all team members know what they’re working toward.
Stick-to-it-ness Seriously impressive entrepreneurs are willing to put in the graft to work through the hard times. They work through the different bits of a knot, rather than trying to rush through and cut it apart. They take their time to craft the product that is in their minds’ eye and don’t compromise.
Bide your time The untold stories of Pinterest and Twitter are that they were operating for two years before they became marginally relevant. It’s very seldom that a startup comes out that delivers overnight success. If you have already validated your problem and solution, then stick with it. Conserve energy and cash, because this is a marathon, not a sprint. Do not pivot too early thinking the solution is wrong. It could be that you are not getting to the right customers, you don’t have friendly onboarding features, some tweaking is needed, or one of many reasons. Timing here is all about patience.
Knowing the right time to fight rather than adapt Important traits for a startup founder are tenacity, passion and grit to keep fighting for what they believe is right. But that must be balanced with the humility and openness to listen to customers on feedback that improves the product, even if it goes against your vision. What determines success is knowing when to apply which one of the personality traits.
Most startups fail because of the lack of customers – maybe their products didn’t end up being what they thought it would. Some fail because they ran out of money because their revenues couldn’t grow fast enough.
But these causes of death don’t exactly illustrate what went wrong for the startup during the course of its life, much in the same way that listing a heart attack as a cause of death doesn’t directly indicate an unhealthy lifestyle that may have led to it. Like with human life, some startup deaths come out of nowhere and can’t be helped, and some are both predictable and preventable.
We all know that there are no shortcuts to success, and there’s no secret formula that can create the ‘perfect’ startup. However, as identified by Bill Gross, there’s one factor that rises above all others in importance: – timing – which represents the single most important make-or-break point in a startup’s development.
Fundamentally, timing is about judgment, intuition, foresight, gut instinct and an element of good fortune, to tip the scales and create the moment. Timing is about ensuring that your idea doesn’t come too early and consumers aren’t ready for it. Conversely, if your idea comes too late and there are already a number of different offerings in front of your target audience, you won’t be able to squeeze in.
Timing can’t be ignored, and it can’t be substituted just by paying more attention to the other elements of your business. Certainly, having a good idea, business model, team and available capital can all increase your chances of success, but without that critical timing factor, you’ll inevitably end up failing, or at least struggling. It’s up to the startup leader to ensure they gets their timing right.