Starting a new business is always exciting, but it is far from the only thing you need to do to achieve success as a business owner or a startup founder. There are obstacles and challenges to overcome, even in the early days of your new venture. Getting the business off the ground isn’t a guarantee of success either.
Startups usually face the most challenges during their Growth stage. It is not always easy to grow exponentially in a competitive market; having sufficient demand doesn’t solve the problem either. There are some challenges that could hamper startup growth. In this article, we are going to take a closer look at those challenges and discuss how to solve them.
Long Sales Cycle
Some startups, particularly those who are targeting business and government customers, face difficulties when trying to shorten their sales cycle. This is because the sales processes of businesses and governments are longer by nature. In some cases, it could take up to two full years before a sale is made, and even longer for payments to be processed.
Long sales cycles harm startups in different ways. The long process of earning revenue means startups with a long sales cycle will struggle to maintain healthy cash flow. At the same time, orders put more stress on the company as a whole since it will have to endure the work and consume resources. Add the higher marketing and sales budget required to conquer this type of market and you have a deadly combination.
There are two things you can do when facing this challenge. The first one is shortening the sales cycle through effective marketing campaigns. When business customers already know you by name, you don’t need to spend as much time closing deals and earning revenue. The other approach is by working with a partner that handles sales for you, usually a system integrator (SI) or technology partner.
Complex Internal Workflows
The fluid nature of startups allows new ventures to remain agile for longer. That same fluidity, however, could also pose a serious challenge. As startups adapt to market changes and alter their organizational structures, it is easy for workflows to become excessively complicated.
If you are struggling to get projects done on time or team members don’t work together effectively, chances are you have complex internal workflows that need simplifying. Good project management and a more suitable collaborative platform are the answers to this challenge.
Finding the root cause of complex workflows is something you can achieve with the 5 Whys approach derived from Lean management. You dig deep into the whys of an issue such as delayed production in order to understand the root cause of that problem.
For simplifying project management, on the other hand, you have tools like Kanbanize. As the name suggests, Kanbanize is built on the Kanban principles, with added features and flexibility that make the project management tool incredibly robust. No project or workflow is too complex for Kanbanize.
Vacant Strategic Positions
Of course, talent is one of the most important resources for a growing startup. With more startups fighting for engineers, marketers, data scientists, and other strategic talent, filling empty positions fast enough to sustain the company’s growth becomes more than just an everyday challenge as well.
The talent pool isn’t shrinking. In fact, it has grown rapidly in the past few years. However, the demand for quality talent is also on the rise, which means you are competing with more companies – often companies that can offer more rewards for engineers and other key personnel.
There are plenty of solutions to this challenge, but the one you need to look into first is investing in your existing talent. You can stay lean as an organization and still grow exponentially by making employee development a priority.
At the same time, you can invest in culture and develop a good work environment. These two elements attract the best talent. Since you also have the option to expand your talent pool worldwide, there is no reason why you cannot fill strategic positions and sustain the company’s growth.
As weird as this may sound, a lot of startups actually fear negative online reviews. Negative online reviews can seriously harm any startup’s reputation. With the market being as competitive as it is today, any loss in credibility usually translates to a substantial loss in potential customers.
Negative reviews, however, are actually opportunities waiting to be seized. For starters, the negative reviews are perfect for identifying problems with customer experience. Be sure to take active steps towards solving those problems so that you gain happier customers instead of disappointed ones.
How you deal with the existing negative reviews matters too. When a negative review is posted, make an effort to reach out to the disappointed customer directly. Listen to the issues that customers faced, and work towards rectifying those issues.
A disgruntled customer could turn into your most loyal brand ambassador when treated correctly. You have the potential of gaining new loyal customers that are more than happy to promote your products and services when you handle negative reviews the right way.
Lack of Funds
Last but not least, we have a classic issue faced by most – if not all – growing startups: lack of funds to support rapid expansions. Even companies with positive EBITDA can still struggle to find funding for a new office, better machines, more team members, and faster product R&D.
Worry not because funding from investors isn’t the only solution to this issue. You have startup loans becoming more common and more affordable. You can use back-to-back loans to fund short projects and fulfill customers’ orders. You also have the option to go public and sell ownership of the company.
The most powerful way to raise funds, however, is crowdfunding. You can fund a new product or a big project with the support of people, all without giving up ownership of the company. A successful crowdfunding campaign guarantees both funding and potential customers too.
With these five common startup growth challenges solved, there is nothing stopping you from taking your startup to new heights. Now that you know how to solve these common problems, you can focus on tackling the more specific ones and grow your company even faster.
Author Bio: Zoe is a young, passionate writer with ample experience in business, blogging and all things e-commerce. Connect with her on Twitter @HelloZoePrice