Overcoming the Challenges of a B2B Tech Startup…
The tech founder’s to-do list is a window into the daily life of innovation and entrepreneurship. As the driving force behind a fledgling tech company, founders wear multiple hats, as well as the unfortunate company-branded hoodies. They juggle countless responsibilities, often badly, but someone must do it. From product development to team management, funding to market strategy and sales, each item on the founder’s to-do list plays a crucial role in shaping the success and trajectory. Let’s look at some of the key aspects of running an early-stage startup that founders must focus on and master.
Build a Trusted Leadership Team
Founders must surround themselves with good and supportive people to help them along the way. It can be a lonely place in an early-stage business, but over time it will be necessary to establish a trusted leadership team who work together to make decisions, devise plans and execute them. Having an agreeable team that doesn’t offer ideas or challenge assumptions won’t move things forward. Allowing for rich and diverse opinions is healthy and does not show a lack of support for the vision: it’s the best way to sanity check a founder’s point of view and keep them honest. It’s helpful to have a leadership team that can bring balance and focus back into the conversation and provide proper governance of the day-to-day running of the business.
Empower Feedback
Knee-jerk reactive decisions by founders or changing direction every five minutes are best avoided, and being surrounded by experienced people helps avoid bad moves. Having robust conversations with a trusted top table will provide the rigour and validation needed to examine proposals and make good decisions. Entrepreneurs sometimes cannot help themselves and get distracted easily. If there is no mechanism in place to rein in their indulgent tendencies, this can be a risk to the business. Importantly, financial discipline must be applied, and it helps to have someone with strong financial skills involved in all management meetings.
Set a Clear Path Forward
Crafting a tech founder’s to-do list helps stay focused and complete important tasks, it sets priorities, inspires creativity and maintains alignment on a clear vision amidst the inevitable chaos. It’s a roadmap that helps navigate through challenges, opportunities and ambitions. Setting appropriate business goals offers a glimpse into the passion, dedication and strategic acumen driving the business forward. By understanding the nuances of what occupies any founder’s agenda, we can unravel the intricacies of startup life and appreciate the dynamic nature of building something exciting from the ground up.
Below is a quick overview of the tech founder’s to-do list, containing the important tasks they must invest time and resources into. Acquiring company-branded clothing doesn’t make the list.
Top 7 To-Do List for Tech Founders
1. Market Fit
You cannot pursue a growth strategy, let alone scaling your startup, until and unless you have achieved product-market fit; it’s that important. Without it, your idea cannot flourish into a sustainable business. Frequent engagement with prospects and customers is essential to applying their feedback to refine your offering and ensure it continues to meet a genuine need that businesses are willing to pay for. As you start to grow and build revenue, acquiring satisfied customers that refer you to others, you may find your funding options begin to open up. When this happens, you know you are on your way.
2. Secure Funding
Entire volumes can be written on all these topics, but none more so than the funding dilemma. Funding is usually the necessary key to unlocking the potential of your startup, but can also be a perilous endeavour if you get it wrong. Timing is everything, as you don’t want to risk running out of money or giving away too much. Startups have many funding options, which may be appropriate at different stages with different outcomes. These options are self-funding, taking on debt (loans and overdrafts), applying for grants, crowd funding, angel or venture capital investors, private equity and IPO. Knowing what to use, when and why is critical, as is having a well-defined cap table appropriate for each stage of growth and financial event.
3. Recruit the Right Team
This challenge starts right at the beginning and never really stops as you grow your business from early stage to growth, scaleup and beyond. Many successful businesses often comment on how important recruitment is, as they invest significant time and resources in this one activity – at times it may feel like they have become a recruitment company. The faster a startup grows, the more staff you will need to support your growth. It’s important to bring new team members in with the appropriate skills and experience, but equally important is the attitude to fit the culture you are trying to develop. Startups are not for everyone; some people flourish in such creative and informal environments, while others prefer the security and rigidity of more established organisations.
4. Nurture Your Culture
Human capital is fundamental to your success; it doesn’t matter how innovative your technology is, you need people to develop it, do the marketing and selling and support the customer. Company culture is a core attribute founder-CEOs must harness. It takes considerable effort to develop and nurture the desired culture for a business, which is embodied by everyone in the team in what they do and say, so that it is genuine and authentic. Much of this is done by example, as the behaviours of your leadership team demonstrate what is and what is not acceptable – as a leader, all eyes are on you. There are devices to help you do this that must be articulated, such as your company’s purpose, mission, vision and core values.
5. Scale Operations
As a founder of a tech startup, you cannot leave anything to chance. You are essentially orchestrating a series of processes to target, acquire and serve specific customers. You can only scale processes you know and understand, and this means creating systems on how you do these things. There is no sense in scaling the technical team if you are not investing in marketing and sales to win new customers. Your focus must be on growth, and that means investment in marketing is more important than anything else. The sooner you realise selling to other businesses is the hardest thing your B2B startup must do, the quicker you will focus on how to sell more successfully and efficiently. Building competency in marketing and sales is critical to your growth, not hiring more software developers.
6. Invest Appropriately in Marketing and Sales – Above All Else
B2B tech businesses must invest significant resources in acquiring new customers, if you are serious about growth, that is. Founders from a tech background often don’t like this, because they don’t understand frontline operations and would prefer to build technical teams of like-minded hoodie-wearing coders. Instead, you must come to terms with spending money on marketing and recruiting salespeople. Building a marketing engine may be less appealing than hiring new developers, but only one of these costs is an investment that will help increase revenue and secure the future of your business.
7. Build Your Brand
Strong brand awareness within the target market is essential for early-stage businesses to establish an identity, connect with customers and differentiate from competitors. A founder’s role in this is fundamental, as your personal brand is intertwined with your startup. You must be prepared to go out and speak at industry events, write opinion articles and be the spokesperson for the business on as many platforms as possible. Your marketing function must have the resources to promote the brand consistently and with a consistent message to your target audience. Engaging storytelling and customer references that resonate with prospects will help in building an emotional connection over time with customers.
The Startup Rollercoaster
The complexity of running a startup requires a broad set of skills and a great deal of patience, something the average tech founder will simply not possess. First-time founders will especially find the choppy waters of entrepreneurship difficult, demanding and very stressful. Many will recognise this early on and seek help and support from other professionals who can join the team to plug skill gaps and accelerate progress.
Marketers Beware
Self-aware tech founders will anticipate many of the challenges and hire experienced people to run the business and drive sales. Founder-managed businesses can produce some of the best and worst environments for people to work in. Prospective employees must choose carefully before committing to one. For marketing professionals joining a startup, you are on the precarious front line, which means you’re the first to be challenged and potentially exited from the business if sales forecasts don’t go to plan. Select the founders you want to work for carefully and build a healthy relationship with them that builds trust on both sides. Good founders will never breach that trust, but for those that do, this is the clearest indication for a marketing professional to leave the business as soon as possible. Founders who do not have your back are not worth the sacrifice.
You may want to read: “How to Define Your Target Market.”
