Every business wants growth--startups especially. In fact, growth is how the value of a business is evaluated. Whether that growth is measured in sales, users, recurring revenue, etc. So how is it that some businesses seem to grow effortlessly, while others struggle to tread water? This is a question I have been particularly fascinated by lately, and in an effort to learn more I spoke with someone who found rapid business growth in a matter of months: Vip Sitaraman, founder of Explica, a multi-faceted digital media startup. Sitaraman originally made headlines when he was just 18 years old, after his company was funded by Seed Sumo. Sitaraman is one of the youngest people to raise a round of venture capital. (Millennials & Generation Z on the rise!)
Announcing a $450,000 seed round this week, the company, Explica, has reached over 6.5 million Internet users.
1. Listen to your skeptics
Or even better, partner with them.
Startup ideas are often very personal, and many founders mistake their skeptics for enemies. Everybody loves a good Shark Tank episode where Kevin O'Leary chews out a hyper-defensive founder.
When Explica first pitched MVII8, the firm's founders -- Lorin Radtke, formerly of Goldman Sachs, and Brad Seidel, formerly of Nix Patterson -- were initially skeptical of the media company. Their investment firm is a far cry from a Silicon Valley venture capital group seeking tech disruptors. Based out of Austin, TX, MVII8 is invested in highly-profitable business models ranging from real estate to consumer packaged goods.
Now, two months later, MVII8 is the lead investor in Explica. The company's direction will leverage the financial expertise of MVII8 with the disruptive technology of the Explica team.
Your skeptics can become your most powerful allies. But as founders, you have to realize that going against the grain is part of the process. Focus on proving your idea has value, and let the results speak for themselves.
2. Respect the economy of your niche
Companies fail when they fail to listen to their customers. As Steve Jobs would say, "People don't know what they want, until you show it to them." It's not your customers' duty to know their pain points and needs. Rather, it's your duty to predict and solve for them.
For Explica, they are focused on delivering animated HTML infographics in a niche where their competition is long-form copy. Looking at trends alone, this is a prime example of how you have to be aware of both your current competition as well as the larger trend of the industry. If Explica has attempted to compete with other more traditional publishers, their growth path would have looked a lot different. So they changed who their competitors were, by focusing on a different aspect of their niche.
3. Hire away blind spots
Adding new team members who challenge the boundaries of your perspective is essential to putting meaningful checks and balances on decision-making. Leading from within lets your company grow with its employees as they learn collaboratively.
Nando Luna was the first employee to join Explica, as it was just launching within the Seed Sumo accelerator. Sitaraman had carried the bootstrapped company thus far, but realized the need for experience in negotiations & operations. Luna, a veteran startup developer, ended up being the perfect fit.
Luna worked at Disney when he was just 15, created over 50 mobile/web apps, and boasts over 5 years of experience managing developer teams. "He's an amazing mix of scrappiness & experience," Sitaraman raved.
Founders should look for candidates who bring new--potentially contrasting--insight to the company. There is a difference between looking for people who have similar DNA--that is, people you can work well with--and people who have overlapping skill sets. Find people who share similar beliefs, not similar skill sets.
4. Be scrappy
Many companies find themselves limited by capital or geography from certain potential hires for specialized jobs. Similarly, Sitaraman found in some areas (i.e. ad tech, marketing), it didn't make financial sense to expand the team further.
In these cases, Sitaraman contends it is the responsibility of the founder to simply learn and adjust on their own. This is in keeping with the lean startup ethos arguing that startups need a work-demolishing "superstar" founder, armed with a small team capable of taking down any task.
As such, during the course of the accelerator, Sitaraman wolfed down entirely new skill sets from cost-per-click ad targeting to setting up servers in days. Luna explained, "Vip is the first one in the office, and the last one to leave--if he does." The role of the founder/CEO is both filling any gaps in the company while keeping track of high-level vision.
5. Simplest iteration, first
Balancing vision and capability with time is a constant struggle that the company must map out. Especially with high-risk projects where much of the development path is through uncharted waters, it's important to build projects like nests: simplest iteration first, then scale up.
Luna can attest neither he nor Sitaraman are strangers to such complex projects, "He never believes something is impossible, just that we haven't looked at it from the right angle to solve it yet." Well-mapped development is important to solving problems at scale: combining different low-level solutions together to develop one high-level solution.
Especially for startups with heavy development timelines, agile workflows are especially important for productivity. Focus on what you can do really well, first, and then expand from there--and don't be married to any one idea.