Statics show that only one in ten startups mature past 5 years and there are many factors to their demise but we’d like to point out the 3 most common mistakes1, so you can prepare for and avoid them:
1. Lack of Demand for Product – If you don’t have a relevant product you will not survive. Not only is it important to focus on relevance but you have to make the case for your product or services IF it’s a new field or new technology. Explain how your product solves your customers’ problems or improves their situation in some way.
2. Wrong Team in Place – If you’ve been focusing on your technology then you have one very clear area of strength and that is of great value, but in order to grow and be successful, you need to hire a diverse team with varying skills and work experience. Scalability and diversity are key.
3. Lack of Funding or Capital Raised – This is a big one for startups in all fields. Initial rounds of funding only last so long, it is key to have on-going and honest conversations with a Business Advisor or Financial Mentor about how to raise funds and to stay open to and relevant to investors to get clear of the danger zone and into the black.
Because the Bind 4.0 Acceleration Program was designed with all this in mind, our program is fine-tuned to help startups grow and find the right resources at the right time. We’ve outlined a few important tips to keep your startup healthy and strong.
How to Succeed with Bind 4.0
1. To Succeed you must Fulfill a Market Need.
In a new industry or using new technology in an established field, you will have to first explain the need for your product and this is vital before you can offer a solution. Until recently cybersecurity companies first had to explain the digital risks, the security threats at hand and the need for intelligent solutions. It’s harder for the groundbreakers in a new industry but once they educate customers on the need for their product and value they offer, they can better sell their solution.
The Bind 4.0 Mentors and Partner firms provide invaluable insight while working on the client projects within the program, the startups work in realtime on high-ticket contracts and receive critique, feedback and guidance while improving their product thru use cases / experience.
A successful example of establishing a need and solving a problem is our alumni Keynetic Technologies. Co-Founders Jon Matias and Jokin Garay developed cybersecurity solutions here in the Basque Country but weren’t finding the right sales channels until they joined the Bind 4.0 program and accelerated their business by adjusting their value proposal and emphasizing the product relevance and then by having the opportunity to present to large manufacturers like Danobat Group and Batz.
Big data, AI /machine learning solutions provider and Bind 4.0 alumni HUPI was established in France before participating in Bind 4.0 and growing their product and target market within Spain. Co-Founder Romain Roquefere said, “The Bind 4.0 program triggered development and has been a tremendous accelerator for us. The diversity of the events organized gave us a precise view of the state of the market, as well as an idea of its appetite for these new technologies.”
2. Know Where and How to Scale:
A diverse team will allow you to focus on evolving your technology and let experts focus on other important areas like Sales and Marketing, Finance Management, Patents, Legal Contracts, Business Development, etc. It’s vital to surround yourself with a balanced team to complement your talents, to help pursue your vision and to provide specialized skills. It’s also important to think two steps ahead, as this Forbes article points out, ”You are always in hiring mode if you are growing.”
Combining specialists new to the workforce (Newbies) with experienced veterans is another way to stay diverse within your growing team, both offer important yet differing perspectives. Newbies tend to adapt well to change and offer fresh new ways of looking at things while seasoned experts often have more composure and insight into implementation and a clear overall vision of the project at hand.
Take for example, deception technology cybersecurity provider CounterCraft, which has 3 diverse and talented Co-Founders who share the same vision and responsibility for their team but have important roles individually that play to their strengths. The CEO is a serial inventor and entrepreneur with years of experience in cybersecurity, the CTO is a master developer and self-proclaimed cybersecurity geek, and the CSO is an innovator who thrives in B2B settings.
CounterCraft participated in Bind 4.0 in 2017 receiving projects from Partners Arcelor Mittal and Elecnor and have since grown their company, adding another 6 team members in areas of programming, sales, customer service, marketing and development. Not only did they make intelligent decisions regarding where to scale up but they also selected a diverse group regarding age, nationality and experience.
CounterCraft said that Bind 4.0 opened doors by offering a paid client and some credibility with large companies the Industrial sector that they could acknowledge publicly.
3. Budget Accurately, pursue paid projects & stay open to multiple rounds of investors to avoid running out of cash.
Money is limited and goes quickly in a growing business especially in fast-paced tech environments. One major benefit of Bind 4.0 is the insight from expert mentors, seasoned entrepreneurs and notable executives who offer advice to young startups from a perspective that isn’t easy to access outside the program.
Before pitching to prospective investors or partners, a Finance Manager or similar expert must assess the value proposition while focusing on the viability and profitability of the business and product. Fine-tuning your value proposal with first-hand experience pitching and working within the industry is one of the ways Bind 4.0 helps startups boost their business.
Computer vision and advanced robotics specialists, CIN Advanced Systems, experienced significant growth after meeting with Bind 4.0 Mentors and Coordinator Marian Gabilondo, who recommended taking on investors and connected them with VC firms and legal advice. This personalized guidance solidified their financial plan, increased their capital and boosted growth in the marketplace, ensuring good footing for the years ahead.
Our mentors, collaborators and sponsors like Basque business development agency, SPRI, offer legal and financial advice and facilitate investments to promote success in the local ecosystem.
Networking with investors, entrepreneurs and industry giants puts Bind 4.0 startups in the right place with the tools to connect, grow and thrive.
One Final Tip: Seek local or Industry-Specific Acceleration Programs and Apply! Programs like Bind 4.0 are designed to support and boost startups so you can use their expertise, professional network and insight to keep you in business and succeeding.
*Statistics cited from Feb 2018 by CB Insights, tech market intelligence and analysis platform.