Author: Anish Williams, Co-Founder & CEO, TranServ
When comparing opportunities within the past few years across the world, India has emerged as an outlier that has witnessed an exponential boom in terms of its market potential. A lot of this has been driven by digital start-ups. Young, hungry professionals no longer turn to foreign shores in hopes of a bright career. They rather choose to stay and carve out their own niche as entrepreneurs.
Many professionals who had left India years ago for greener professional pastures are now leaving their plush jobs in blue chip MNCs across the globe and making a return to the country. The convergence of the recent digital renaissance that took India by storm, played a huge part in opening up doors to newer opportunities for startups. Armed with smartphones, tablets and other portable digital devices and aided by improved wireless network capability, the Indian users today are always seamless connected to the digital medium across several platforms. These users, the early adopters, are the ones who accepted and powered the nascent startup ecosystem in India into a full-blown global economic force.
Startups today, believe in a disruptive approaches, leaving behind traditional methods of problem solving and creating innovative solutions to address market gaps. From taxi cab aggregation to grocery delivery to last mile logistics to fashion & lifestyle, Indian startups have been identifying opportunities in the current market scenario to leverage their advantage over the existing business solutionsto. However, as more and more startups are incepted and brought into existence across the country every day, upcoming entrepreneurs must not lose focus of what it takes to really make their startups a success – scaling.
Every entrepreneur wishes to scale up his venture to become recognized as an industry leader. But how does one achieve that status? Here are some dos and don’ts that might help budding entrepreneurs make informed choices.
Criteria: The Product
Dos: Constant product re-engineering, flexible market approach, and optimal product placement
Don’ts: Staying fixated only on creating a high-impact revolutionary product, rigid implementation
Firstly, for a startup to scale, it is simply not enough to have an awesome product; reinvention and proper product placement are just as vital. People tend to get bored of using the same features over and again, and competitors will invariably be able to replicate servicesrise. What is the next best thing that can be offered to the users? Would it alienate the existing user base or would it lead to an increased adoption rate amongst the target demographic? What newer demographics could be tapped with the development? What other challenges would be faced during expansion, and how can one circumvent any potential hurdles during expansion? What features could be added to add more value to the product, and what haven’t been gaining enough traction with users? Entrepreneurs must pay close attention to all these aspects before committing to the scale up.
Criteria: The Scaling and the Investment
Dos: Leveraging market analysis for timing the ramp-up, strategic usage of investment, selecting benefactors with previous investment experience in the chosen segment
Don’ts: Plunging headlong into scaling without capital backup
Another important factor that entrepreneurs should pay attention to is the timing of their scaling. Undertaking an operational ramp-up at an opportune time can lead to results much better than initially expected, while doing so at a time when the market is going into through a downturn will likely end up burning capital unnecessarily. This also highlights the importance of funding and the difference it can make to one’s fledgling startup. Attracting investors on board can lead to a much faster rate of operational ramp-up and can also see a startup negotiate through any rough patches that might affect it due to changing market forces. Choosing the right investor is also extremely vital, as startups often neglect the importance of value-additions, a veteran investor previously associated with similar ventures might bring to the table.
Criteria: The Rate of Expansion, the Team and the Infrastructure
Dos: Planning incremental infrastructure and operations expansion, maintaining a feasible expansion rate
Don’ts: Aggressive operational expansion without comparable infrastructural capability, investing too heavily in infrastructure in one go
Two other things to pay heed to while scaling up would be the rate of expansion and the overall infrastructure. Invariably, as a startup expands, there would be more consumer traffic that would increase the load demand on the venture’s infrastructure. This would require increased investment into capacity and employee strength to match the demands made by the users. Scaling up too quickly without sufficiently increasing the resource capacity – technological or human – could lead to lags in service delivery, broken consumer experience and lower levels of service adoption. Conversely, investing too heavily in the manpower and infrastructure too soon could often prove detrimental to the organisation, especially during the early phase growth; a significant capital investment during the time the venture is still finding its feet in the market may increase the reluctance to pivot the approach should the need arise. As such, entrepreneurs must strive to strike balance between the two facets to ensure optimum scaling up of operations.
Criteria: The Team
Dos: Bringing professionals with cross-dimensional expertise on the team, carefully analysing and vetting potential hires
Don’ts: Ignoring the role of the Human Resources play in the organisation’s growth, unstructured hiring criteria
Human resources, in particular, are very important to any startup, especially during the scaling up stage. They are the growth drivers for startups, the pillars upon which the entire foundation of the brand’s success is built upon. Hiring the right human resource at the right time is the key to drive success of a growing venture. In this day and age of cross-functional domains, it often tends to serve entrepreneurs better to find a professional with expertise across verticals which could help drive business growth through a synergistic inter-departmental approach.
Criteria: The Brand Building
Dos: Engaging customers to build brand presence, building more utility-driven approach for consumer base consolidation
Don’ts: Depending solely upon short-term measures such as discounts, coupons, deals etc for consumer aggregation
Startups can also look to leverage innovative, engaging strategies to increase their visibility levels and ensure customer aggregation. While short-term strategies such as discounts, coupons, cashback deals etc. might work in attracting users to their services, heavy reliance on these measures to power the scaling-up process can often be unfavorable. Focus, instead, should be directed towards devising long term consumer engagement measures – users have a tendency to be loyal to a product or company that offers better user experience and value-driven utility.
Criteria: The Money
Dos: Building a seamless transactional experience, tailoring payments solutions to suit consumer base
Don’ts: Choosing cumbersome payments solutions
Since at the end of the day, a startup is a business venture, entrepreneurs must pay attention to improving their users’ payment experience. This extremely vital fact is often overlooked by ventures. Ensuring a seamless, secure and swift transactional experience to its consumers should be the priority of any business, particularly in a country that sees nearly 60-70% cart abandonment in e-commerce segment. For a startup, this alone could define the difference between success and failure.
The startup scenario in India is robust and growing at a healthy pace. This is aided to a great extent by the vital inter-industry support lent by established startups to other upcoming ventures, thus ensuring that cycle of development goes on without surcease. As the Co-founder & CEO of TranServ – itself a digital payments startup company – I have been a witness to all these trends and facets.
Personally, I believe in investing in people over businesses. I prefer to build up visions, to nurture that entrepreneurial spirit which drives people into creating something they care about, to help provide upcoming ventures with the tools they need to succeed. This, ultimately is what it is all about – building a favorable yet competitive ecosystem and laying the foundations of a more vibrant, healthier economy in which to incubate future startup growth.
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