By Rose Martin
Over the past decade, the technology domain has seen massive growth, making it a lucrative field for aspiring entrepreneurs. According to the mid-year global tech market report published by Forrester, for the first time in history, overall purchases of technology software, hardware, and services in 2018 is expected to exceed 3 trillion USD.
With the world obsessed with technology, many entrepreneurs are entering the tech domain, tapping unexplored markets with innovative product offerings. Setting up a technology startup can be an exhilarating yet an overwhelming experience. In order to transform a big tech idea into a revenue-generating reality, a tech startup entrepreneur often has to experiment with various strategies, meet dozens of investors and influencers, learn from the slip-ups of others, and modify both product and business plans to meet customers’ needs.
If you have a validated tech business idea and the passion to transform it into reality, here are six things you must do before you launch your tech startup.
1. Co-Create with Your Customer
An infographic from events firm Kapow shares that 68 percent of customers are lost by a startup in its initial years because customers perceive that the company or its offerings are indifferent to them. As a result, customer on-boarding is the secret to improve the customer experience and build a strong and ongoing relationship with them.
Driving customer-centricity is tough for an early-stage startup owing to the lack of manpower and capital. Yet, the most successful tech startups have involved their customers at every stage, launching products and services that their clients truly need.
Involve your potential users in product design and address their concerns to create a positive customer experience. When interacting with customers find answers to the following questions:
- Is there a real need for the technology or are you creating a market for it?
- How will your tech product address the current challenges?
- Are your customers willing to pay for the technology?
Test your product prototype on the target audience to get feedback that can guide modifications in the product and your future business strategies.
2. Strengthen Your Core Tech Team
As a startup founder, you have limited resources for conducting recruitment and training programs for your team. Consequently, it is critical that you take charge of the hiring process to assemble the best core team possible.
Keep your startup’s vision in mind and consider hiring people who will partner with you in realizing your goals. To begin with, you will require an engineer (technical expertise) and a marketing manager (business expertise) who can help you lay the foundation for a successful startup. Furthermore, if you are developing a new concept, you may require a product manager who can handle the pre- and post-launch activities.
When hiring engineers, coders, and developers look for people who are proficient in HTML, CSS, and programming languages. Go through their credentials on LinkedIn and research on the projects they have worked on.
Hiring people who are technically competent and share your passion in building a successful startup is a challenging task, yet it is worth your time and effort as investors often care more about the founding team than the product to be launched.
3. Focus on Product Development
The product development phase is crucial for a tech startup as it does not have an established product or are yet to identify the technology to be introduced. When developing the product, clearly define your product features, its functions, the target market, the competitors, and your startup goals. Design the product based on the customer requirements, even if you have to compromise on a few less important features.
For instance, if you are designing a wearable health device that monitors blood pressure, the user may want a device that is small in size and light-weight. Consequently, other features such as the battery-life and an attractive display become secondary when designing the product.
Once the prototype is created it needs to be checked for programming issues to avoid future technical glitches. Plan for multiple product revisions before your product is launched in the market.
4. Consider Your Sourcing Options
The prototyping phase often demands the production of smaller quantities of the product for test marketing activities (alpha and beta testing). Consequently, you need a trusted and skilled set of engineers and manufacturing vendors who can refine the crude prototypes by testing their quality, performance, and reliability. Hardware tech startups often find it challenging to make the transition from the prototype to the final marketable product.
Initially, you may have to outsource the components and assemblies required for manufacturing the final product. Involving off-shore manufacturers will help you reduce your production cost, saving you funds to manage other core functions such as research and development, improving the product line, and developing marketing strategies.
However, once the volume of sales and customer conversions goes up, the margin paid to the third-party manufacturer may increase your production cost, eating into your bottom line. At this point, it is wise to consider building resources within your firm, enabling you to manufacture the components in-house at a lower cost than proposed by the third-party manufacturer.
5. Collaborate with Established Technology Giants
Tech startups and established technology companies around the globe are slowly appreciating the fact that joining forces can bring numerous benefits to them. The large technology giants gain exposure to fresh ideas, ingenuity, and the latest technology that start-ups bring, revolutionizing their rigid business environment and introducing them to new markets.
On the other hand, large enterprises offer unmatched computing capabilities and domain expertise that helps create the modern tech products. Moreover, tech startups benefit from the direct investment made by the reputable organizations — namely Intel, Google, Apple, and IBM — helping them scale faster.
Before approaching an organization to collaborate with, clearly define the assistance you require and your expectations of the partnership, enabling you to impact your business in a positive manner. Concurrently, it is critical to list what you will offer them in return. Brainstorm with your team and make a rewarding proposal for your potential partner. For instance, you may need help with reaching a target set of audience and in return, you have a technology that can fix a peculiar issue faced by the large enterprise.
6. Market Yourself Effectively
Your tech startup marketing strategies will determine your ability to connect with potential customers and the decision makers.
Digital marketing holds a world of promises in offering multiple channels to reach your prospects. Offering compelling and ahead-of-its-time content is a low-cost strategy that will enable you to establish your authority in the domain. A basic WordPress blog with remarkable content that is targeted to the right set of customers can help you engage your prospects and generate conversions.
Additionally, in the tech startup world, people invest in people. Effective networking can help you gain a few early adopters who are willing to try your product and talk about it to others. Attend tech meets and conferences and join start-up ecosystems and incubation hubs in order to network with the key opinion leaders and influencers in the technology domain, enabling you to promote your product to qualified leads.
It is also crucial to be aware of your competitors and their offerings. Study the landscape you are about to venture into by doing a competitive analysis. A simple SWOT (Strengths, Weaknesses, Opportunities, and Threats) analysis for your product and those offered by your competitors will help you spot your unique selling proposition (USP). This USP can then be used as a part of your communication strategy. Start by downloading our USP template here.
As you get ready to launch your dream venture, consider the above-mentioned tips to put your tech start-up on the fast track to success.