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The key factors for a Startup

Alessia Selvatici

Wave was born as a Startup. But what are the fundamental factors for a startup?

The starting point

In an interesting TEDTalk, Bill Gross, founder of many startups, says that startups could really make the world a better place. " But if the startup organization is so great, why do so many fail?"

So he tried to look across what factors accounted the most for the companies, in order to understand why some succeeded and others failed.

The phase of Analysis

Bill Gross analyzed these five factors across hundreds of companies:

  1. the Idea;
  2. the Team, and so the execution, adaptability. So much about a team's execution is its ability to adapt to getting punched in the face by the customer. The customer is the true reality.
  3. the Business Model: does the company have a very clear path generating customer revenues?
  4. the Funding;
  5. the Timing: is the idea way too early and the world's not ready for it? or too late and too many competitors?

The results

The results also surprised the author himself.

The number one thing was timing. Timing accounted for 42% of the difference between success and failure.

Team and execution came in second, and the idea, the differentiability of the idea, the uniqueness of the idea, that actually came in third.

To confirm these results, Bill Gross quotes the example of Airbnb.

One of the reasons it succeeded, aside from a good business model, a good idea, great execution, is the timing.

“That company came out right during the height of the recession when people really needed extra money, and that maybe helped people overcome their objection to renting out their own home to a stranger.”

Same thing with Uber: the timing was so perfect for the need to get drivers into the system and, on the other side, drivers were looking for extra money.

In conclusion, the best way to really assess timing is to really look at whether consumers are really ready for what you have to offer them.

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