Roughly 100 million tech startups are founded every year. And yet, of these, 90% fail, and less than half even make it to their fifth year. These staggering statistics demonstrate the high-risk, high-reward nature of this business. Given their current popularity, combined with their high rate of failure, it is clear that your tech startup must make a notable impact for it to survive and thrive. While this is much easier said than done, there are a number of small changes you can make to your business which will instantly make it more distinctive.
Here are a few methods of maximising your startup’s odds of success.
Partner with Local Businesses
The size of established companies in this sector are one of the main reasons it can be so difficult to make inroads. Corporations like Apple and Facebook represent some of the most valuable businesses on the planet. Thus, competing on a level playing field with them is essentially impossible, especially without serious financial backing. This needn’t be a hindrance, however.
Try using the relative smallness of your business as an advantage by partnering with local businesses. Massive tech corporations often do little for the area they are based in, so behaving contrary to this you can make your startup distinct. If you are based in California, consider working with California courier services for example. This can not only be beneficial from a PR perspective, as customers supporting local enterprises, but will also help you establish a network of friendly, established businesses within your region.
Find Your Niche
As mentioned earlier, starting a tech startup is becoming increasingly difficult in large part due to the market share of its big players. Discovering a specific niche demographic is another way you can counteract this. A lack of market need is one of the main reasons startups fail. Thus, catering for a highly specific or previously unidentified audience will give users reason to flock to your business regardless of size. It will also create a distinct reason for your company to exist in the marketplace.
Personalising your content, and interacting with customers via social media, can also help you reinforce this niche, and build a dedicated, loyal customer base. Consider using readily available marketing data on your firm’s website and social media pages to help identify your target audience.
While all tech startups have a high change of not failure, startups with significant financial backing are up to 20% more likely to succeed than others. Securing funding early on is therefore imperative in distinguishing your business. Traditional business loans may be difficult to acquire in some cases due to a lack of credit history, so you may try attempting to secure backing from angel investors or venture capitalists.
While achieving this is far from straightforward, there are a few things you can do to maximise your chances of investment. First, research the details of companies which have recently secured investment. From this, you can see which elements potential investors are looking for and incorporate them into your own business. You can also identify specific individuals which have previously backed similar projects to your own, and target them directly.