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There is sometimes an assumption that the tech industry is an unstoppable gravy train, pulling in at millionaire station for every first-time founder. While many stereotypes have a basis in fact, that basis can often prove fast and loose. Sometimes stereotypes offer genuine insight, other times they simply serve to lead you into a false sense of security.
Here are six reasons why you should challenge the status quo.
1. Is it safe to assume your idea is the best?
It’s sobering to hear that around 95% of Australian tech small businesses fail to get off the ground. A recent Inc.com article put the majority of these businesses lead balloons down to the personal failings of the entrepreneurs themselves, rather than market conditions or organisational faults. Traits of arrogance and short-sightedness were highlighted as particularly detrimental. You assume that your great idea combined with your checklist of tips and tricks are on to a sure thing.
2. Challenge the status quo
The assumption is that you and your team will survive on the rush of a great idea, camaraderie, and opportunity! We’ll rent an office space, and everyone will work hard and pull their weight and new leads will come knocking on the door. Don’t fall into this trap, you need to be vigilant – have systems and procedures in place to protect you financially as well as protecting your reputation. Evaluate every team member and every process. If it doesn’t stand up to scrutiny then it might not work! Things to consider for your small business are strategic planning, financial management, marketing, industry knowledge/networks and product/software design and development.
3. Are advisors worth the hassle?
While trusted, impartial advisors are always helpful, the assumption that you need something like an incubator to succeed is a fallacy. They are businesses themselves with their own targets to hit, which can represent a conflict of interest that can result in your small business not being guided entirely by its own needs. You might need to take a second look at their credentials.
4. Some customers are bad for business
Your small business won’t go anywhere without listening intently to the feedback of your customers. Anyone who has ever worked in retail will tell you that the customer is quite often wrong, and it’s surprising that the levels of in-store homicide aren’t markedly higher. It’s best to cut them loose for the sake of your employee’s wellbeing, and the dignity and respectability of your company.
5. Rethinking start-up capital
A common thread within successful small businesses is the challenging of accepted norms. Uber, for one, not only entirely revolutionised the taxi industry, but also took on government regulation the world over. Just because there’s a traditional way to do something, that doesn’t mean it’s the best way; from cryptocurrencies to online lenders, financial technology is evolving fast, disrupting the banking sector and offering new ways for businesses to access, make commercial decisions, and deliver services. “Wherever there is great demand for your product or service, you will also encounter great resistance. It is how you deal with those barriers to innovation that will define your business” – Shaun McGowan of Lend.com.au.
6. Don’t fail fast: Pivot!
The pace at which technology is evolving is leading to even the most traditional of industries changing the way they do things. The most successful tech companies of the decade (called the ‘unicorn club’) share one thing in common; they all made a dramatic pivot early in their history, whether that was a change of product, demographic, business model or mission. Think of business planning as an ongoing, living process – keep in constant contact with your customers and watch your market carefully for new entrants or disruptive new ideas.