Errors of startups: hope only for yourself
Foreign startups are focused initially on attracting venture capital investments, thanks to which they will be able to develop their product. Russian companies should transform their business model based on the fact that the domestic venture capital market is underdeveloped.
Analysts claim that 71% of FinTech start-ups in the Russian Federation start exclusively thanks to the personal means of the founders. With the development of the project, hardly anything has changed – 40% is covered by capital of the top officials and only 33% of the budget is covered by revenue.
The average portrait of the founder of the financial and technological startup: a person invested about $ 300,000 in the business and received a controlling stake (if any). Moreover, almost 100% of firms complain about the lack of sufficient funds for development.
The obvious error: reluctance to take action in the search for venture capital investments, the hope only in own strength.
Another misconception is the inconsistency of the project stage with the requested funds. At the idea level, getting money from outside is quite difficult. However, having a prototype, FinTech Company may seek support among banks. Business angels may also be interested in the project. The main thing is to understand clearly the stage of the project and the means that can be requested at this stage.
It is even easier to attract financing when the first sales of the product began and the revenue was 30-50 thousand. It is necessary to request exactly the amount in which running a project through sales channels and recruiting a team will cost. According to representatives of QIWI Venture, selling FinTech-project can attract about 500 thousand dollars. However, one should treat failures with understanding: investments at this stage are still accompanied by increased risks.
Errors of startups: lack of marketing
Around high-tech, startups are usually people who cannot sell. It is very important to have a team of marketing specialists who will conduct a market analysis and be able to present the project to customers. FinTech usually targets b2b segment; it presents solutions for the corporate sector. Moreover, here lies a common error: the inability of the team to bring the benefits and efficiancy of implementing their product to customers. It is better to show the test product and collect feedback than to bring the project to perfection (and at the same time, no one knows about it anyway).
Another error of startups is targeting money. At the same time, young entrepreneurs forget about the importance of business links and contacts. It makes sense to communicate with people having relevant experience. They can help with advice in difficult situations, present a project to interested parties and even offer a joint venture.