By Idan Waller, a die-hard digital entrepreneur. I co-founded Bluethrone with my brother Alon, a startup specializing in buying and scaling mobile apps.
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In today’s unpredictable business climate, startups need to possess unique characteristics in order to not only survive but also thrive in turbulent times. With the right strategy and approach, a startup can achieve long-term success, regardless of the economic environment.
Be Profit-First
When creating any business in turbulent times, profitability is king: In order to ensure long-term success, I believe prioritizing profits over revenue is essential. Many startups focus solely on increasing their revenue without considering the cost of acquiring new customers.
This approach can lead to short-term gains and may not be sustainable in the long run. Being profit-first means ensuring that the business is generating a profit from its existing customers, which can help fund growth and expansion.
Use Technology To Serve The Business
Many startups make the mistake of adopting the latest technology without fully understanding it or considering how it can benefit their business.
Technology should not be the driving force behind the business; it should serve as a tool to help the business grow and improve its operations. Do you want to use that shiny new product? Great: Just make sure you know how to operate it from day one and overcome issues fast.
Did using a certain product get too time-consuming? Don’t be afraid to revert to something simpler. Startups need to identify the right technology that can help them improve efficiency, reduce costs and enhance their customer experience.
Use Great And Scalable Unit Economics
Startups need to have a clear understanding of their costs, revenue and profitability per unit. Is that campaign still bringing in the same results, or do you need to change it? Is your startup still in the black even with its high costs?
Startups need to constantly optimize their pricing, reduce costs and improve profitability at all times and always keep a finger on the pulse. Through constant observation and conclusion-drawing, startups can achieve long-term growth and profitability.
Adapt To Worldwide Chaos
In today’s world, startups should have the ability to use worldwide events to positively impact their businesses. For instance, with the rise of remote work after Covid-19, startups can now hire, operate and grow their teams from all around the world while tapping into global talent, reducing employing costs like offices and bills, and improving their operations.
It’s important to identify the right talents for this, as a good and beneficial remote team member can go a long way toward the company’s success. The modern tech employment market almost requires a global mindset and developing strategies to navigate worldwide chaos.
Avoid Physical Limitations
To further utilize the new, no-physical-limitation work world, startups should work to operate without supply chain constraints, hardware limitations or geographic barriers. This approach is critical, especially in turbulent and volatile times, where you want to be as independent from external factors as possible. This means that fewer things outside of your control can go wrong, which can help you maintain a smoothly operating business.
Remain Agile
Bruce Lee once said, “Now you put water into a cup, it becomes the cup. You put water into a bottle, it becomes the bottle.”
The flexibility of business models is always important, especially in chaotic time periods where banks collapse seemingly overnight and VCs may withhold money in an uncertain market. Your ability to change and adapt to different economic climates will be key to your success, as will other elements like profitability and great unit economics.
If your free, ad-supported business model isn’t working anymore because advertisers are spending less on ads, switch to a subscription-based model and get rid of your dependence.
Or maybe you’re already using a subscription-based model, but unemployment raises its head in your region and people aren’t willing to pay as they used to. Consider going freemium, with a combination of ads and one-time payments for different features.
Your ability to develop an agile mindset that focuses on reading the terrain will prove invaluable when times get hard.
Startups need to possess unique characteristics that can help them survive and thrive in turbulent times. By focusing on being profit-first, utilizing technology to serve their business needs, building great and still-scalable unit economics, navigating worldwide chaos, operating without physical limitations, and rapidly adapting to new business models, startups can achieve long-term success regardless of the economic environment, as well as help themselves stay relevant, competitive and profitable in any situation.
