More than 600,000 new businesses launched in the UK last year, according to Start Up Britain. While the government celebrates breakout numbers, we rarely hear of those that don’t make it. Some say up to 90% of food and drink startups fail in their first year.
Should we be encouraging these budding entrepreneurs who are attracted by the appeal of running their own businesses and the hope of a successful exit?
During my journey to introduce Fuel10K, I discovered a few things a startup might find useful before printing its designs. To kick off, are you solving a problem for consumers and/or retailers? Too many startups have innovative products and great brands but haven’t thought about what problem they are solving and for whom. Taste and a funky brand alone is not enough.
The business objective must be clear from the outset, otherwise it is hard to know where to point the tiller. The ambition of an exit should be a waypoint on a temporal horizon. From that you can work backwards.
It’s key to have a simple raison d’être to make a purchase decision easier. Evidence of growth and profit motivates most buyers, solving a ‘lifestyle’ problem satisfies consumers. Start small, prove the concept and expand through concentric circles.
Successful brands all stand for something and ensure it resonates with the right audiences. Without knowing your target customers ‘intimately’, how will you know what they want and where they ‘hang out’? Fortunately, most humans are surprisingly predictable. Consider using behavioural science to influence. From packaging design and marketing campaigns to emotive collaboration, we are all wired similarly.
When picking your battles, stick to what you are good at until you are robust enough and have enough resources to look at the next ‘project’. Aim for profit as soon as possible.
Finally, but most importantly, surround yourself with the best team possible and make them feel like ‘owners’. And seek as much advice from the industry as you can. The path has been well trodden - reinventing it is for the extraordinary!
Barney Mauleverer is co-founder of Fresh Marketing and Fuel10K