There are 305M startups launched annually. Many of them fail in the first year. Liam Martin, the co-founder of TimeDoctor explains how to survive and succeed.
Let’s start with the dark side of the business. 50% of all small businesses fail in the first couple of years. What are the common mistakes that people do when they try to launch their own startup?
Failing to hit product market fit is what most people will tell you is the reason why most startups fail but I have a slight edit to that. A lot of tech startups think if you build it they will come, that is very rarely true. In the majority of cases, better products fail because they don’t have a clear customer acquisition process in place. Go get customers (any customers) to buy what you’re selling at any price and you should work your way into something that works.
Ok, so where should we start our strategy when we’re thinking about launching an own company?
What’s a problem that you have that currently hasn’t been solved that you’d love to have a solution to? I had a huge team of online tutors who couldn’t confirm how long they worked for students and it was killing my previous business which is why I saw TimeDoctor as the perfect solution to that problem. Find a problem that you’re passionate about solving that you know you can at least make a few hundred thousand dollars off of and you basically have a business.
What were your goals and concerns at the beginning?
My initial goal was to get 1000 people to actively use and pay for the application, we did that in about the first month so then we reset our targets. The biggest concern was growing vs cash flow if we went up by 5k MRR and hired 6k worth of people that was sometimes tight as estimating cash flow was problematic especially for a bootstrapped company.
Should we trust our own sense of our business or rather feel free to ask for advice? If yes – who should we ask and were looking for the support?
I have a network of mentors and I ask them questions based on their experience. As an example, I have one mentor who ran a billion dollar company, I have another one that runs a 100 million dollar company and a few that are 2-3 year ahead of me and some who are literally six months ahead of me. I find asking more tactical questions is basically useless the further along the company is and asking strategic questions of companies that are a year or two ahead of me is also not that useful in comparison to 100 million dollar companies.
Do you have any must-have to-do list task or growth hacks to grow start-up that many companies can implement in their strategy that will very likely work?
Read The Traction Book for tactics, Zero to One for strategy and lean startup for execution.
What was the biggest challenge you had and successfully overcome as the Co-Founder of the startup? What is your biggest success?
Being able to delegate tasks was the biggest problem I had inside of the company. Switching from an entrepreneur to an executive was very difficult for me as I wanted to do everything myself and recognized that it would not scale the business if I didn’t start delegating responsibilities to other ppl.
How do you predict the future of startups? Do you think the market will be more mature or maybe it already is?
People thought the market would conglomerate but in reality, very few companies are actually looking into step and conglomerating. I believe it is because a lot of tech startups are too profitable to sell for founders and not profitable enough to buy up competitors. Companies that are growing at 50% a year and churn out at 50-100 million will for the foreseeable future have enough capital to always cut themselves a part of the market and I honestly don’t know what will happen as usually, markets coalesce into 3-4 main players in each vertical but that doesn’t seem to be happening because of how cheap it is to build a tech startup.
About the expert:
Liam Martin is a co-founder of Time Doctor which helps individuals and organizations to be more productive.