Tracking the journey of a start-up

 

Nowadays, the only thing entrepreneurs want is to see their start-up expand at an exponential rate. Before diving deep into the factors affecting the journey of a start-up from early stage to growth stage, let us understand the different stages.

In the simplest terms, every start-up goes through three stages – Existence, Survival and Success, and Growth.

• Stage 1: Existence

In this stage, the whole strategy of the business revolves around keeping it alive. The owner’s only concern is to obtain more and customers. The organisation is in its simplest form and the owner is responsible for almost every activity. There is no defined system, structure or formal planning.

• Stage 2: Survival

If the start-up has reached this stage, it means that it is a workable business entity. It has generated a healthy and constant customer-flow. Here the primary concern shifts from mere existence to balancing the revenues and expenses. The organisation still remains a simple entity with a limited number of employees supervised by an experience top management.

• Stage 3: Success

This stage can be understood better by dissecting into development and growth stage.

·         Development

In this sub-stage, the company is economically healthy. It has penetrated the market up to a sufficient level to ensure economic success and above-average profits. The company can continue to operate at this stage indefinitely, given the environment around the company does not change and the market niche remains intact.

·         Growth

At this sub-stage, the founder starts consolidating the company and line up wherewithal for growth. The founder utilizes all the cash and the lending power of the company to finance growth. For the first time in the company’s short lifespan, strategic planning is extensive and crafted by the experts including the owner.

Now, as we have understood the crucial stages of a start-up, let us discuss the factors impacting the journey of the start-up. 

 

• Organization Related Factors
• Financial Resources: It entails resources that are crucial for every business to grow. These resources mainly include cash and lending power of the company.
•  Personnel Resources: The size and quality of the workforce of an organization impact its performance to a great extent. Therefore, in today’s dynamic world, the founder must look for people that are innovative and creative.
• Business Resources: A company’s relations with its customer and suppliers directly affect its market reputation. Together, these factors decide how smoothly a business can function in a competitive market.
  
  

·         Management Related Factors

·         Vision – Like every company serious about its business, start-ups too must have a long-term vision. It gives the organization and its employees a purpose in the short-run and direction in the long-run.     

·         Operational Abilities: In its nascent, a start-up relies solely on the efforts and abilities of its founder. Therefore, it makes all the difference how capable and skilled a founder is in managing the operational, financial, and marketing front of the business. 

·         Managerial Ability: As the business starts gaining momentum, the need of a management becomes stronger. This management must bring superior managerial abilities and masterful delegation of tasks. It must also foster a culture of teamwork to take the company to the next level.

Together, all these factors shape a company and its future. If managed well, these factors can accelerate a start-up’s movement from one stage to another. However, one must not think these are the only factors that exist. In a dynamic business ecosystem, new factors keep on coming forward as new conditions arise. In such cases, a good mentor can help and handhold a founder amidst tough times. With this thought, Rajan Nanda Innovation Labs recently introduced Inter Collge Innovation Challenge. In this contest, students from all over India with best innovative ideas in agri-tech, rail-tech and infra-tech can participate. These budding entrepreneurs will get to meet the mentors from the industry.10 best innovative ideas will get seed funding of Rs. 5 lakhs each. The objective of RNIL with this challenge is to help these start-ups in early stages and take them to higher stages. The complete information about this challenge is available on its official website.