According to a study published in Forbes, roughly two-thirds (67%) of young millennials wish to start their own business. Most aim to build their creative space, giving life to their ideas and dreams.
Nevertheless, building an unorthodox startup business and enhancing the odds of success often depends on a skilled startup cohort, a dynamic space, an innovative business model, and much more. Also, it has to be noted that 20% of startups fail within a year, 30% within two years, and 70% within a decade.
This is why we have curated critical insights and tips based on our decade-long experience working closely with startup founders to help founders build a strong startup cohort.
Whether you are a startup founder or aspiring to be one, these tips are just for you. Let’s dive in!
What is a Startup Cohort?
A startup cohort is a program that brings together a group of startups with similar goals or industries to help them grow and succeed.
These programs are typically run by accelerators or incubators, providing resources and networking opportunities. Cohorts have a set time period and culminate in a demo day.
Participating in a startup cohort provides entrepreneurs with invaluable insights, feedback, and connections to overcome challenges. Cohorts also offer a sense of community and support for early-stage startups.
Strategies for Building a Strong Startup Cohort: A Guide for Entrepreneurs
Here’s how you can effectively create a resilient startup cohort:
1. Measure and mitigate the risks
The startup journey comes with several inherent risks. Successful startup founders have invested effort into understanding the various risks, measuring them, and working out strategies to mitigate them.
While building your startup cohort, you should thoroughly assess your value proposition against the possible risks, including market access and readiness, technology, team and talent, financial risks, etc.
2. Commit yourself to passion
Successful entrepreneurs commit all their time and energy to expand their niche because they hold immense knowledge, expertise, experience, and passion. Doing so as you build your startup cohort helps you navigate the hard times, particularly in the early stages when you must start from scratch and endure the risk of unknowns.
3. Validate the market for your product
Often, startups fail because they find it hard to sell their products or services to the target market. Driven by the spirit of building something new, startup founders fail to evaluate the market and demand for their value offerings.
To avoid this, you must build a minimum usable prototype with just the critical features and validate the same with your target customers. Check if your product/ service is a ‘must-have’ or ‘nice-to-have’ offering. This will help you understand if there is a desperate need for your value offering.
4. Build an innovative business model
One of the most crucial steps in building a startup cohort is translating your idea into a lucrative, sustainable business plan. As much as it is crucial to remain committed to your passion, having a solid business plan is imperative.
Build a comprehensive plan for all the essential components of your business, including the following.
- Target customer segments
- Distribution channels
- Revenue stream
- Cost structure
- Sales and Marketing
Remember that the first plan is based on the founder's intuition, and it will keep changing as it comes in contact with the stakeholders in the startup cohort, including your team, customer, suppliers, investors, etc.
5. Maintain the habit of innovation
A startup is all about experimentation and innovation. When they become established companies, structure and processes get standardised, and there is little room for innovation and creativity.
Many companies fail because they do not maintain the innovative spirit they had in the beginning. This is more crucial in this era where something branded todaybranded new today gets outdated very soon.
Therefore, startup founders must continuously research and leverage their explorative intelligence. This adds to the strength of their startup cohort and ensures their sustenance.
6. Secure funding and finances
Focusing all of your time on developing your idea is crucial. Securing funding and finances for different business operations is important in building the startup cohort.
Evaluate various options like angel investors, venture funds, family, friends, etc., and have backup plans. As much as it is important to explore seed funding opportunities, it is also crucial to estimate startup costs, create a sales forecast, develop a pricing strategy, and evaluate your cash flow.
Most importantly, you should remember that these are assumptions based on your intuition and subject to changes when it comes under the lens of different stakeholders.
7. Patience is the key
Often, startup founders get onto a hiring spree that even before they have a solid business plan, they jump into operationalising different departments for marketing, sales, HR, etc. Impulsive hiring and premature scaling remain among the top reasons for startup failures.
Initially, you may not require a well-structured startup cohort in teams and departments. You must be prepared to wear different hats and shoulder multiple responsibilities.
Having fortified teams in the initial stages will be overkill, and high attrition rates and rehiring would only disrupt the business operations. So, it is essential to scale your startup cohort patiently and organically.
Being business owners, you have a greater command over your dreams, goals, and schedules. Investing your time and energy into continuous learning and research, mitigating the risks involved, and scaling at a steady speed helps ensure the success of your startup cohort.
Having a breakthrough idea? Sign up to Scalix and find the market, capital, mentorship, and community support to translate your idea into a full-fledged product or service and a scalable business model.
Scalix has an integrated platform for founders that will help you navigate the challenges experienced by entrepreneurs in the initial stages when they startup.
Contact us today!