5 tips everyone who launches a startup should know
An expert weighs in on finding your passion, working with the best team and not becoming the next Webvan.
When you see the meteoric rise of someone like Facebook CEO Mark Zuckerberg or the contestants on ABC's "Shark Tank," you might be thinking: hey, I can do that.
What exactly goes into launching a successful business? We decided to ask an expert for advice. Yehuda Raff is the cofounder and director of iPartners Africa, a company that advises startups and helps them get off the ground. About a decade ago, Raff traveled to Israel where he saw firsthand why the Mediterranean country is dubbed the Startup Nation. "The Israeli ecosystem is super advanced. I was just blown away," he told From The Grapevine. "They push the boundaries of what technology can do." Raff, who has returned to Israel several times since that eye-opening trip, has brought what he learned there to businesses he invests in all around the world.
Below are Raff's five tips for someone who's considering jumping into the startup shark tank.
Do you really want to start a startup?
For starters, ask yourself if this is really something you want to do at this moment – every day, all day. Keep in mind, many startups fail, and not all entrepreneurs are good at it. "It might be that you're not very good at business, but you make amazing pottery and you should sell your own pottery," Raff explains. "You've got to work out how to run that business even though you're naturally not good at numbers."
And if you don't have a good business acumen, then surround yourself with the right people. "The people are more important than anything else," he says. "Can this team build and execute this idea and take it to market? Can they make all those things come together?"
Learn outside of school
"When you go to college, you don't necessarily know exactly what you want to do with your life," Raff tells us. "You've got to pick a vocation that's sort of what you've studied and what you think you want to do. But by the time you finish college, maybe you think, 'I'm a completely different person. I could've studied something else.'"
So he suggests learning outside of the classroom. "I like to call it College 2.0. Go work, go do some time in a startup. See the pain of the founders when they have to manage not having enough money to do all the things they want to do," he says, adding that seeing the torrent of deadlines and pitch meetings with potential funders is worthwhile exposure. "I think that there's a massive value in going and watching somebody else do something."
Ask yourself why you want to be an entrepreneur
Raff suggests asking yourself a series of questions: Why do you want to be an entrepreneur? Why would you want to start your own business? Are you a natural entrepreneur? And if you're not, can you learn to be a natural entrepreneur?
"I think there's lots of reasons for being an entrepreneur," he says. "I think you might be an entrepreneur because you just understand business and you just love it and you've done that since you were a kid. You could want to be an entrepreneur because you value your time more than money, or you value your independence and not being controlled by a system. And you might be an entrepreneur because you're creative and you want to make creative things and so you want to build a business out of the product you want to make."
Network, network, network
Real estate may be all about location, location, location. But starting a business, well, that's all about relationships, relationships, relationships. And how good you are at building those will determine just how successful you can be.
Whether you're starting a tech company or opening a laundromat, every sector has its own ecosystem of networking events and programs and accelerators that you should acquaint yourself with. "There's a landscape that you want to go and connect to," Raff tells us. "There's a universe of people and capital looking for opportunities."
It's all about timing
Timing is a subtle thing and it's why sometimes startups get lucky. It's certainly helpful to be first to market, but don't let that desire rush you into launching your business before it's ready for prime time. Take the time to research your competitors and, more important, your potential customers. Because if your timing is off, it can be your downfall.
"Sometimes you get unlucky because you're working on something amazing and it's the wrong time," Raff explains. Take, for example, early online food delivery services like Kozmo and Webvan, which appeared on the scene in the late 1990s. Consumers using slow Internet connections on bulky web browsers in a pre-smartphone era just weren't ready yet. The startups were way ahead of their time and shut down shortly after they launched. "In the market, are people ready for this thing? I think that's one of the biggest questions. It doesn't help you to be that clever."
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