Traits of becoming a unicorn founder doesn’t appear magically in you after you become a unicorn but it’s rather inherent since you launched your startup or developed over the period of time as a result of varied life lessons learned while sailing the boat of your startup. Hence Heinrich Heine correctly said that “Experience is a good school. But the fees are high”. I’m writing this blog as an effort to prevent you from paying such a high fee by serving you with certain proven traits of unicorn founders, on your platter. Hope you not only learn from it but adapt for better success of yours and your startup.
Once upon a time, unicorn startups – those valued at $1 Billion or higher – were a rare breed. The unicorn startup landscape has shifted dramatically since the term was coined by VC Aileen Lee in 2013. However If you’re planning to join the class of Top Unicorns, which includes Uber, Airbnb, and Spotify, just remember that it doesn’t happen overnight. Magical success can sometimes take years. Below are some of the traits you should imbibe in yourselves.
1. Don’t follow where the path may lead, go where there is no path & leave a trail
According to CB Insights, 42% of startups fail because there was “no market need”. One of the things that sets unicorns apart from typical market leaders is their desire to disrupt. This could mean dramatically improving upon an existing solution or breaking into the market with an entirely new type of product. Uber disrupted the taxi industry by making it easier to access car service.
But the million $ question is: How do you know if your idea has unicorn-level market potential? Here is how you can get it to analyse well:.
- Achieving a product-market fit felt effortless. You’ve tested and tuned your product/service with ease.
- There’s a lot of excitement around your product/service and consumers are willing to pay top dollar.
- You can manufacture and produce the product/service in volume.
- Your product/service serves a large, global market.
- You have a winning team of industry-leading experts.
- Your product/service is considered to be “disruptive”. There is no one else doing what you’re doing
2. Quick Iterations
We’ve all heard the proverb “if at first you don’t succeed, try, try, try again”. Loosely translated into unicorn-speak, this means if your product isn’t perfect yet, iterate, iterate, iterate! There are numerous other famous unicorns that began as something totally different that ultimately led them to success.
The point is, in order to survive and thrive in the startup world, and especially in order to reach unicorn status, you have to be ready for a pivot. Experiment, observe, tear everything down, start over, and iterate until your user experience + customer engagement fully align with your business goals.
Example:Not having planned to sell anything other than books, Amazon, later on, began to receive suggesting emails that people would like to buy music CD’s or Movie DVDs in the same manner. It led the foundation to much more at Amazon and it now deals with over 30 product categories ranging from books, Music CDs, Fashion, Hardware and Tools, Electronics, Computer software, and Accessories and more.
3. Assemble the Right Team
What separates unicorns from the rest of the pack is that they have the right people, skills, tools, and data to make the magic happen. Unicorn investors are attracted to startups that have the best and brightest talent. Every single person you hire should fit your company’s overall personality. It’s almost as if they are part of the product itself.
The second most important thing in this context is, maintaining harmony among the team members. Successful startups have always paved good attention in this regard. To avoid founder disputes, at least the founders’ agreement and the shareholder agreement along with clearly defined roles, responsibilities, and decision making authorities for varied functions should be in place in advance to deal with matters professionally.
This is a part of internal corporate governance which helps run a business smoothly. To know more about various agreements and instruments which are essential & must for the founders on Day 1 of startup and also anytime during its journey, irrespective of whether they are planning to raise fund, just go through our exclusive blog on Not just Statutory Compliance! Apply Internal Corporate Governance to build the Backbone of your Startup.
4. Build an MVP
Building an MVP means you create the most basic version of your startup idea as quickly as possible. This is essential and has topped the reasons for startups getting towards failure due to cost overruns.
Example: Like in a war there are varied plans, say Plan A, B, and C for an army to be chosen from and probably only one of them will lead to success. Now the challenge before the army is to carry out multiple iterations that too with limited arms & ammunition.
Say Plan A is implemented followed by Plan C and both plans failed. With experience, the army concluded that Plan B will surely lead to success but it is unable to implement it because 90% of its arms & ammunition are consumed in implementing Plan A and C.
In other words, if huge resources are divulged without assessing customer’s needs then you would end up with cost overruns. With a scientific process adapted for MVP, you can resolve this problem very well by testing your assumptions and optimizing your idea for product/market fit based on user feedback from your early adopters.
Following the scientific process of MVP, you could determine ahead of time what financial results you would truly achieve. If the business doesn’t meet those levels, evaluate why they weren’t met. Iterate quickly. The process is explained in detail in our blog on Startup begins with IDEA! A successful Startup begins from MVP!!
5. Secure Right Investments
Whether you’re bootstrapping or working against a shortening runway, it’s important to be able to prove traction when the time comes to seek investments. For investors deciding which startups to fund, traction is the number one priority, closely followed by projected revenue and growth.
But these projections need to be backed by hard data, like a weighted sales pipeline forecasting the growth over the next 6, 12, or 18 months. If you ask for funding without any numbers to back up your claims, you risk scaring off potential investors for good.
Instead, wait to seek out investors until you have a marketable product with proven demand, as well as a steady stream of opportunities flowing into your pipeline.
It is of utmost importance to value your startup the way investors will value. There are numerous methods out there which can help. However, a trick question here is: Can you value a startup which is at a pre-revenue stage? The answer is Yes! You can check our exclusive blog on Is Startup Valuation essential on Day1? How & At What Valuation can Pre-Revenue Startup get funded?
6. Unicorn Etiquette
Perfectly quoted by Louis L’Amour, “No memory is ever alone; it’s at the end of a trail of memories, a dozen trails that each have their own associations”. Well before they receive a $1 Billion valuation, you can spot potential unicorns showing below a dozen trails:
7. Leverage Content Marketing
Even if your brand has little to no reputation, you can build trust and gain traction by striking a balance between informative and entertain content.
Producing new content on a regular basis is a sustainable approach to long-term growth. 53% of marketers say that blog content creation is their top inbound marketing priority. You would be glad to know Content Marketing is costing up to 41% less than paid marketing. So the foremost step is: You need to publish more high-quality content on a regular basis. A well-executed, comprehensive content marketing strategy can attract press coverage, improve SEO, and drive traffic to your site – all of which can help startups gain traction.
Industry & Business Model Insights of Successful Unicorns
Below are some Industry wide stats which will give you a holistic idea of the present scenario where the Unicorn startups are emerging more:
Below are some Business Model wide stats which will give you a holistic idea of the present scenario where the Unicorn startups are emerging more:
Conclusion
There’s no definitive recipe for success, but there are key ingredients that stack the odds in your favor. Following the above footsteps of the founders of Unicorns will definitely help. For how much and in what manner you are following and more importantly, adapting these footsteps in your startup, many founder have got their startups screened with, Check my Startup.
Check My StartUP is World’s #1 Unique StartUP Analysis Service for Fundraising & Internal Cash Flow Management comprising of:
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You can get your startup checked with the most innovative and worldwide proven scientific process to enhance the preparedness & probability of fundraising. Similar to an Eagle in sky who watches its prey on ground, Transparent can guide you on what traits the potential investors or funds would like to see in you, as a founder of your type of startup, expecting one of the best ever exit multiple by investing in your startup, when it emerges as a blockbuster by entering into an esteemed Club of Unicorns.
Do you think you have the above briefed traits in you? Tell us in comments about how these traits helped you triumph over your startup troubles.
