In its core practice AFS has come across dozens of start-ups of all sorts and makes. Some truly successful, some just about to make it, some lacking, the vast expanse of mediocre ones and last-but-not-least truly odd ones. We often ask ourselves the question what makes a start-up make it. This is a million-euro question from the viewpoint of the Horizon Programme but also in general. Following is a collection of what our team has come up with.
Nothing is Impossible
When some start-ups or SME think they’ve come close enough to something they perceive as impossible, this is not innovation. Something becomes truly innovative when doubt turns into success. Taking impossibility out of the process means that a long-standing problem is being solved and the target audience will be really excited. At AFS it is a two-way process of them crashing our doubts and we crashing theirs.
Invents New Business Models
Innovation must be disruptive. It should take the legacy way and turn it upside-down, forcing businesses to be agile, flexible and creative in finding ways to win the attention of customers. At AFS we proactively look for disruption in every SME’s model. The only place we do not allow disruption is in the financials.
It is Willing to Shatter Itself Completely
Many start-ups reinvent an existing product by focusing on changes in the way people consume, purchase or behave. However, what makes companies innovative is a willingness to disrupt not only the market but themselves as well, because one cannot disrupt a market unless one disrupts themselves first. The best example for this is the AFS advisory solution for Horizon. Think about it!
Builds a Sustainable Competitive Advantage
A start-up that develops a sustainable competitive advantage is truly innovative. Launching a business that provides value in the present is tough enough, but the ability to carve out a sustainable and evolving niche shows true innovation. Between the inherent resource constraints and inevitable competition from established businesses, this task is increasingly difficult.
Transforms Weakness Into Strength
Almost every business builds upon its strong spots, but a truly innovative start-up goes a step farther. These are the companies that clearly identify their weaknesses and then find ways to redefine them into strengths. This shows that the people behind the company are dedicated to the self-development and self-awareness that a start-up needs to grow and thrive.
Deals Directly With a Customer Pain Point
Innovative start-ups start from listening from their users and clients and learn what their pain points are. This way, they’re in a good position to develop solutions for those pain points – and that’s the kind of innovation that matters.
Acts Fast and Moves Ahead of the Curve
A company innovates when it moves ahead of its industry – before other companies hit the curve. Whether you’re solving a complicated production issue or making a breakthrough in bio-sciences, find room to innovate so you’re not just a carbon copy of other businesses.
Stays Adequate to a Rapidly Changing Market
Innovation is happening more rapidly than ever before. In order to be innovative, companies need to be adaptable. They need to move quickly, adjust plans and evolve with market and customer demands. To do so successfully, start-ups also need to stay in line with their broader mission.
Structure and Budget Fit the Odds
Small businesses are better positioned to be innovative because of their size and structure. The small allows for agility without the hastle of going through layers of approval, which slows down action. However, SMEs have to be more creative than their larger competitors due to a much smaller resource pool. This forces SMEs to break clichés, create and innovate.
Old is New
Everyone’s trying to find the inspiring and intriguing new idea. Sadly, there aren’t many such stones unturned. What we come across more often, however, is someone taking old ideas and reinventing them with a wise trick and some spicing.
One way for measuring the impact of a start-up is to try to figure out the number of people who would be disappointed if this particular SME disappeared tomorrow. Companies who consistently focus on building such a loyal user base of people who need and appreciate the service end up making large, truly innovative companies.
Distinct and Vibrant Company Culture
What ultimately makes a company innovative are the people and the culture. That is why we start advising by asking the question what the company at hand stands for. A true start-up should create an innovative culture and allow its people to take risks. People will fall, but should fail quickly and if the risk is previously calculated, it’s something that should accepted and praised as a lesson and opportunity to learn. Sometimes we all win, sometimes we all learn.