Startup founders often have different reasons for entering the business arena. Some dream of changing the world with an innovative idea. Others might be more interested in pure profit.
No matter the reason, all savvy entrepreneurs understand how important innovation, adaptability, and growth are to long-term success.
Statistics show more than 70% of startups fail due to premature scaling. Other research consistently points to the importance of sound mentorship across all steps of a successful entrepreneurship journey.
Having invested in a number of successful startups, Digital Disrupt’s Andrey Belozerov and Artem Ermolaev understand first-hand how strategic partnerships and astute guidance can make or break a company.
Image Source: Digital Disrupt
Their advice, backed by years of experience, is simple. Both warn startups and founders who believe they “can do everything by themselves” or desire to keep “freedom and control over their business” are missing out on many development and solutions-oriented opportunities.
Business Success, Like Personal, Is All About Balance
Amid wading through countless pitches and conversations at the helm of Digital Disrupt, Belozerov and Ermolaev share one striking attribute that separates successful startups from the rest.
Both explain they’ve come across many projects who emphasize development on one singular concept and forget the big picture. This crucial error ignores the reality that business success is only found “through well-balanced development of all components,” which according to the duo, ranges from the product to management, marketing, and sales.
Digital Disrupt styles itself as a “closed private venture capital club.” But Belozerov and Ermolaev are quick to explain their company does not operate as a traditional VC fund.
The founders note Digital Disrupt shies away from merely pooling capital and instead fosters collaboration where club members, investors, and partners cooperate together. Overall, Digital Disrupt focuses investment capital on tech companies and early-stage startups who demonstrate an MVP, initial sales, or marketing test results and product promotion.
Agility Is Key With A Diverse Investment Portfolio
To Belozerov and Ermolaev, turning away from a traditional VC structure offers maximum flexibility. It also beckons opportunities to consider the widest possible scope of partnerships.
Both argue the modern VC world is one where pure finance has taken a step back and has thrust community building and partnerships into the limelight as the wider industry becomes more “flexible and truly global.”
Digital Disrupt’s investment portfolio does span the world. It includes the niche ‘Fred the Hippo’ e-Learning app for Kenyan school children all the way to Momentus, a world-known space industrialization company.
While Belozerov and Ermolaev have dipped their toes across a wide variety of industries as they seek out potential investments, they still believe a founder’s key to success remains the same no matter the startup they’re spearheading.
Both notice a good founder is willing to repeatedly ask themselves “Is there anything that I still do not know?” To them, a successful startup leader is also able to “take a comprehensive view of businesses processes” and find solutions for “the development of lagging parts.”
Research only emphasizes another tidbit of advice from the Digital Disrupt founders – the willingness to be “ready for the long run.”
What Seems Like A Quick Sprint Often Morphs Into A Marathon
Studies show a founder needs 2-3x longer than expected to validate a business model.
According to Belozerov and Ermolaev, startup founders often prolong the process of securing funding for their business idea. They notice many pitches “look out of place and uninformative, despite their high level of competence.”
Both explain savvy startup founders understand how to talk about themselves and the product clearly and concisely. In the eyes of Belozerov and Ermolaev, founders should come equipped with a clear proposal of “options or next steps” once a prospective investor either accepts, denies, or expresses interest in further discussion.
Compelling startup pitches have only become more critical as the world grapples with the coronavirus pandemic. Many founders find it harder to pitch over video conferencing platforms like Zoom. Virtual meetings often feel less personal than in-person ones.
Professor Gianpiero Petriglieri explains video meetings are often more draining and demanding since a person needs to “work harder to process non-verbal cues like “facial expressions, the tone and pitch of the voice, and body language.”
In An Industry Filled With Failure, What Makes A Startup Succeed?
It’s easy to read about unicorns in the startup world. It’s often much harder to read and reflect on why a particular project fails. The statistics are sobering.
Research suggests up to 90% of startups fail and less than half of all businesses make it to their fifth year. But what separates a startup that receives funding and thrives versus one that does not? Belozerov and Ermolaev have a few ideas.
Both are not shy when asked about what turns them off from potentially investing in a project. A “careless attitude to money and failure” ranks as a top concern. The Digital Disrupt founders also hesitate with evidence of personal disorganization, like when a founder mixes up a meeting’s time or fails to “provide answers to questions in due time.”
They explain these types of failures indicate a founder will not be able to scale effectively if the startup does happen to grow “out of the family business phase.”
Belozerov and Ermolaev caution all startup founders to carefully “review all your resources from time to time to correctly and timely assess what is OK and what is missing” to boost competitive advantage.
Will The ‘New Normal’ Include More In-Person Interaction?
It’s no surprise the coronavirus has changed businesses forever.
McKinsey points towards immense opportunities as the world continues to shift to online shopping and embraces subscription-based services. Belozerov and Ermolaev recognize the pandemic has accelerated online interaction but admit they believe we “can expect a great return to offline” over the next ten years.
The reasons? “Too fast transition and general fatigue from online will lead some segments back offline,” both explain.
They point to the growth of urban transportation and sharing services as the fuel for an upcoming “renaissance” of offline living. Digital Disrupt’s investment portfolio includes an electric scooter-sharing platform known as Carousel and a car-by-subscription service called The Mashina.
No matter what the world holds in the future, Belozerov and Ermolaev still believe the mantra for a successful startup remains the same.
In their minds, great companies are “meeting or creating very deep and very instinctive demand” and feature a synergy between the founder and product that fit each other well.
