Decisions, Decisions, Decisions: 3 Crucial Tips for Running a Startup
If entrepreneurs had a dime for every tip they received, the entire industry would have been bootstrapping. And so, when I was asked to share a few tips of my own, I’ve decided to steer clear from clichés like “hire top talent” or “keep it lean,” and offer something new.
Managing a startup calls for countless decisions to be made every day, and many look for a magic formula to find the answers. I do not believe in magic tricks, but am happy to share my two cents on making bold decisions in the chaos of “startup life.”
Data Is Not The Answer
The lean startup process tells us to quickly establish an MVP, release it and iterate based on the initial results. We are often told to “follow the numbers,” as they’re presumed to be objective, clear and simple. But in many cases, the process would lead to one of three scenarios:
1. Positive Signals: When data shows that the MVP turned out to be a major hit, we can go ahead and celebrate (for no longer than five minutes). How often does that happen? In the startup arena – not enough. The positive signal has made the decision for us, and while we still need to decide on our next step, the numbers provide a clear direction.
2. Negative Signals: The numbers suggest that the endeavour proved to be a bad idea. The feature/product might not be good enough, but one might rationalize and come up with different reasons as to why it didn’t work. Perhaps the experiment was wrong, the MVP wasn’t well defined, or maybe users just need a better tutorial to navigate the product? In this case, we received a negative signal, but still need to make a decision.
3. Mixed Signals: The most common and dreaded situation of all is that of unclear results. In this case, the numbers give an unclear signal – some of it good and some bad – and definitely require us to make a decision. Once again, we cannot just follow the numbers, as they do not lead anywhere in particular.
To sum it up, two out of three potential results will still force us to make a decision. It’s incredibly frustrating to search for the answer within the data, only to realise it’s not there. Because data is not the answer, but instead a way for us to come up with the right questions.
You should look at data as a must-have tool to support your decisions – not make them for you.
Simply the Best
A startup’s roadmap and business opportunities can lead in different directions, making it hard to choose what to focus on. So, how do you decide which of the many interesting ideas should be your next step?
Here at Playbuzz, we follow a thought process I call “best-case scenario,” in which we ask ourselves what each option could ideally do for the company. If the best-case scenario for a specific idea is anything short of a game changer, it will most likely remain an idea for the time being. Game changers are often a series of seemingly smaller steps, but every choice we make must eventually correlate with our company roadmap and ultimate vision.
Ask yourself: Is your next move/feature a potential game changer for the company? If not – go back to the drawing board.
Keep It Real
There’s one single reason why startups fail…
They run out of money.
We’re given many different reasons for these failures: a lack of product-market fit, following the wrong business model or just building a bad product. But in reality, these can all theoretically be solved, as long as you’ve got enough money. So keep your vision in mind, with your feet planted firmly on the ground.
A smart startup creates a series of realistic and necessary steps that lead to your end-game victory, and sometimes this means compromising your vision for now, in order to make it happen later.
Following your ultimate goal to the point of risking your ability to pay the bills is not visionary – it’s dangerous.
At the end of the day, different startups call for a different process and nobody knows your company better than you. There are many great startup tips out there, and if I could offer one last piece of advice, it would be to be very selective regarding the type of guidance you choose to follow. Good luck!
Tom Pachys is co-founder and Chief Product Officer of Playbuzz.