Tech start-ups: Thrive by thinking differently

Only 40% of tech start-ups will eventually become profitable and the number of those who actually “make it” are few and far between. If that doesn’t seem daunting enough, 87% of start-ups globally are known to fail.

Succeeding or failing as a tech start-up is not one big event that just happens. It is the cumulative result of all the days leading up to that moment. Days filled with business decisions.  Sure, a great market fit should be a given, but it’s how a start-up makes daily decisions and thinks differently that will have a tremendous impact on success.

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Find the right decision-making framework

Tech start-up founders will often envision a specific mission and operational culture for their company but fail to create guiding frameworks for the people who come on board.

Once you’ve set out to build the dream team, find an operational framework that enables your entire team to fulfil the mission. Tailor it if needed but steer clear of “reinventing the wheel” too much. Efficient decision-making frameworks allow for autonomy, whilst still working towards the company mission.

According to Michael Bowren, co-founder of the fintech start-up, Finch Technologies “it’s all about finding your right fit – an agile decision-making framework works for us. This involves a collaborative and iterative approach to decision-making, where small teams work together to make decisions quickly and efficiently. Agile decision-making involves breaking down complex problems into smaller, manageable tasks, and using data and feedback to inform decisions.”

Many business owners are hesitant to provide autonomy because they feel it results in too much human error.

However, start-up founders who “fail” earlier are 20% more likely to succeed.

In a tech environment, you need to fail quickly and learn quickly to adapt towards the path to success. The right decision-making framework enables this. Founders need to offer their employees a clear path of both accountability and self-management in order to achieve business outcomes.

Change how you think about operational “black holes”

Founding a tech start-up is both thrilling and nerve-wracking. Tech start-ups easily find themselves in a myriad of operational black holes that destroy productivity.

This is especially the case where market traction and client management become a big part of operations. Whether it’s client “boiler” meetings that stack up or dreaded scope creep, the right framework is an effective combat method against these becoming a pattern.

You’ll need to ensure the right person(s) with all the required context, insight, and experience are making the decisions you employed them for. This ensures healthy, confident teams who focus on core product versus falling prey to the panic some clients tend to create.

It’s critical for decision-makers to “slow” down their thinking, and act “fast” once they have a clear understanding of what they want to say and how they are going to communicate it.

Start-ups are meant to be agile so being bogged down in emails and meetings that lead to project creep is a major flag. Slowing down your thinking is all about clarity. It frees up time everyone will spend going down the wrong route, and it ultimately prevents costly mistakes and big meetings.

Keep things practical and simple. For example, limit the number and type of weekly meetings clients are allowed to slot into your calendar. Key players in meetings need to pitch with clear agendas. When the meeting goals are complete the meeting can be ended early. Why go the full 30 minutes?

Employees who take ownership drive profitability

According to acclaimed start-up founder, Steve Jobs, “when you’re in a start-up, the first ten people will determine whether the company succeeds or not”.

When hiring your team, make sure they are the people who will support and drive your start-up mission. Cowboy hiring tactics often lead to costly hiring mistakes. Stick to your culture fit, thoroughly assess potential employees and ask hard questions even when it’s uncomfortable. Willingness to take ownership and self-manage is key in the early team.

The tech industry is extremely competitive and won’t slow down its future growth curve. Tech start-up founders need to stay on top of reward systems in their industries and tailor it for their teams. Considering everything, from equity options to flexible work arrangements.

Tech start-ups often operate in a fast-paced, high-pressure environment, with a lot of uncertainty and risk involved. Your employees know this, so a well-designed reward system can help to incentivize and reward the dream you want to keep. Imagine innovation, productivity, and growth being a result of the right team versus something you have to drive with a stick every week.

• Ean Barnard is the head of brand and marketing at fintech start-up Finch Technologies.
  

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