The path to startup success is not always a predictable one, as only 30 percent of seeded startups secure additional funding. To help us understand why some startups thrive while others stagnate or fail, it's useful to examine startup success stories. These stories provide a unique "been-there-done-that" perspective and invaluable insight for early-stage startups. Here are 10 wildly successful startups and one valuable lesson we can take away from each:
Lesson: Target several niches
Kaltura is an open-source video platform for managing, publishing and distributing video content. The platform successfully targets and caters to several niches: enterprise, education and media. Kaltura has built specific features and functions tailored to the needs of each of these sectors and is being used by 300,000 enterprise, education and media organizations, including Groupon, Bank of America, Harvard and HBO. Having recently raised $25 million, this startup's success illustrates the importance of targeting several niches. Don't target everyone, but select a few key niches and master them.
Lesson: Offer personalization
Pandora is a personalized music-recommendation service which tailors stations to suit a listener's music taste and relies on feedback about songs and artists. By providing a personalized listening experience, individuals enjoy music selected just for them, which gives users a unique experience, a feeling that they matter, and most of all deep brand loyalty. Pandora is expected to raise $231 million in the sale of 10 million shares.
Lesson: Put end-users in control
Taboola, which is at a revenue run rate of $100 million--and with only 120 employees, one of the highest revenue generating companies per employee in the world--is a content-discovery platform that recommends video and other content that users are likely to be interested in based on the content they're currently viewing. While not the only content-recommendation platform, Taboola has decided to take a forward-looking approach of democratizing recommended content by putting control in the hands of end-users.
Lesson: Don't try to do too much at once
Voxy is a mobile app that helps Spanish speakers learn English through bite-size, daily lessons based on real-life experiences. With advanced proprietary technology, the company could have expanded service to other languages, but decided to stay focused on teaching English, particularly to Spanish speakers. By keeping this focus, Voxy has established great presence in the market and has over 3 million users and $15 million in funding.
Lesson: Go global but customize for each market
Gett is a mobile ride-ordering app which makes it easy to order a taxi or black car in 20 cities including New York, London, Tel Aviv and Moscow. Gett first launched in Israel, became a resounding success, and then expanded to Europe and the U.S. It is largely as a result of its global expansion that Gett now has more than 1 million users and about 1, 500 enterprise clients, including Google. Gett is revolutionizing how people navigate cities and has raised $42 million.
Lesson: If it's not broken, don't fix it
ShoeDazzle is a personalized online styling platform and store, which helps women find and purchase shoes, apparel and accessories. Since its 2009 launch the company has built a user base of over 13 million members and has raised $66 million in funding. However, things weren't always dazzling. In 2011, the startup ditched its successful subscription model. This tried-and-trusted e-commerce model has since been reintroduced and the company is once again thriving. Takeaway? If it's not broken, don't fix it.
Lesson: Develop best-in-breed technology
2U partners with top universities to bring their degree programs online. The company, which has raised nearly $100 million in venture capital and is a leading player in the education-tech world, offers infrastructure, marketing and software-as-a-service technology to help universities digitize and scale their programs. At the heart of 2U's success lies highly advanced learning-management software and suite of great tech products that support students, faculty and the entire learning and campus-management processes. By focusing on technology and hiring some of the best technologists in the industry, 2U set itself apart.
Lesson: Emphasize extreme team collaboration
Prismatic is a newsreader which uses algorithms to create newsfeeds tailored to suit a reader's unique interests. Based on a user's reading habits and liked content, the platform suggests other relevant news. Prismatic has more than 25,000 weekly users and $16.5 million in funding. Much of the startup's success lies in its super collaborative, hands-on working environment where engineers work very closely with designers, researchers and the entire team. Bradford Cross, Prismatic's CEO, learned about the intricacies of design so he could be actively involved in their uber-collaborative process.
9. Apartment List
Lesson: Foster beneficial partnerships rather than reinvent the wheel
Apartment List is a rental marketplace which helps renters find the ideal apartment. The site consolidates millions of listings in one easy to search online map, making the traditionally inconvenient home-hunting experience convenient and hassle-free. Instead of competing with CraigsList or reinventing the wheel by trying to build an entirely new marketplace like Zillow, Apartment List has partnered with several leading real-estate marketplaces and is using their inventories to power a $15 million startup.
Lesson: Go device-agnostic
MapMyFitness, which was acquired by Under Armour for$150 million, is a fitness-tracking platform that relies on GPS technology to map and record workouts. MapMyFitness initially only offered a fitness tracker but has since added other fitness resources including online training tools, a nutrition-tracking product and fitness calculators. Since being founded, MapMyFitness has grown to over 13 million users and is compatible with over 200 devices including FitBit and Garmin bike computer. This device agnostic approach contributes to the platform's appeal and its consequent success.
While there may be no such thing as a startup recipe for success, there is a great deal to be learned from these startups that made it big. Whatever lessons you take away from these success stories, one thing to keep in mind is that it takes much more than a good idea for a startup to thrive.
What lessons have you learned from successful startups?