Every day, there are millions of entrepreneurs looking to solve big problems or create new experiences and opportunities for people around the world, thinking about how they can create the next Snapchat, Uber, or Airbnb. However, once you have defined the idea, built the MVP and formed the startup, what’s next?
How do you convert your Startup into a Company — without losing the startup innovation and disruptive mindset?
First, let’s discuss what defines a startup. There are different points of view on the key features of a Startup. From my conversations with founders and investors, the key features of a startup can be defined as PMT.
Product: You either have an amazing and unique product based on thousands of customers/users feedback or you have a special, proprietary technology that will rock the industry.
Market: The market is big enough to capture meaningful revenues (even if your Startup only owns a few percentage points of market share), is willing to experiment with disruption or change (whether the market is aware or not), or has recently suffered external changes that have modified the rules.
Team: The founders and the first employees have a strong commitment to building a special company, an extraordinary understanding of the problem that customers need to be solved, and everyone is seeking excellence in their work.
Great!
Now that we have a better understanding of how to build the startup, let me ask you some important questions:
Are you just building a startup?
How impactful would you like to be?
Are you willing to spend 6 to 10 years to build a Company?
Do you have what is needed for the Company to succeed?
With those questions in mind, I want to highlight 6 aspects that should be considered in the process of transforming your Startup into a Company.
Define processes
Startups might be seen as places where there are no processes at all, but that is far from the truth. There are, of course, some processes within startups that are not yet fully formed. However, even from the earliest days of a startup, can form the foundation as you scale from Startup to Company. Processes can be improved over time with a number of iterations and a commitment to building them from the Startup’s earliest days.
If you are converting into a Company, it is critical to determine which are the key process that needs to be defined in each area of the Company. It is important not to create so many processes or sub-committees so as to be overly bureaucratic, but it is helpful to define a good base or structure to build for the future.
Mature your team
When a company starts, it is common that the first hires are based on referrals from people in the founders’ networks. After that, you have built your first trusted circle so you continue looking with referrals from referrals within your network. However, it is important to know that senior people should be part of this even though might not be referred. The most important thing is to always hire people with a “winners” mindset.
People have to be ambitious and look to generate meaningful impact. People should not join a startup solely for the paycheck. That’s why you need to hire good people and mature them by giving them opportunities to grow and scale their careers as soon as possible!
Set milestones & KPIs
If you are sailing on a ship, moving the ship doesn’t mean you are getting closer to your destination. It is critical to define the milestones you have to achieve in order to get to the next stage of your Company. You should also celebrate from small to big wins and achievements, which is an amazing way to keep the team motivated and focused on hitting key metrics on a consistent basis.
Strategic mindset
As a startup, you are always working to figure out how to improve the product, service, performance, hiring. This means that often you will be working hard to get things done. Executing on a day to day basis doesn’t mean that you should sacrifice spending time on strategic thinking in order to plan for how the business should look 6–12 months from now. Consciously setting aside time to do strategic thinking to understand the whole movie rather than just a snapshot of the routine can be critical to setting your company up for success in the long-term.
People management
Sooner or later, you will need people to grow. There are some startups that hit their first success with a few members in the team, others that require hundreds, but eventually you will need people to become a Company. You will need people that have titles, roles, expectations. Managing people is one of the toughest things for a founder to do. The reason is simple — every single human being is different! You can read as many books as you want, take courses and prepare for this, but you’ll never be completely ready.
Managing people means you care about them, you invest time talking with each one, spend time getting to know them and their lives, their motivations, hobbies, goals. Once you have done this, you will be able to understand better their mindset and how they approach their professional life.
Continuous improvement
There is not a single company that was born as a Company. It is unfair to compare your recent startup with a Company that is 5 or 15 years old. The most important thing to always keep in mind is that every single day, you need to improve something, learn lessons and make adjustments.
Are you just building a startup?
No, this is just the first step, you still have thousands of steps to go through. Remember that you are in a marathon, not a sprint. But, you will also have to be sprinting the marathon often!
How impactful would you like to be?
In every company, passion is mandatory. By passion, I mean the desire to learn, improve and create disruption and a huge impact in your industry.
Are you willing to spend 6 to 10 years there to build a Company?
Hell yeah! This has to be your lifetime project!
Do you have what is needed for the Company to succeed?
In Nowports we are in this transition, we started a few months ago and have been experiencing these and other challenges. Remember, start with some small, iterate and get from a Startup to a Company.
I am the founder of Nowports, the first digital freight forwarder in LATAM and the reason I wanted to share this is because these are challenges that Nowports and many startups in LATAM face every day. It is always good to see what’s happening in other companies in the region to learn from them and become a better version of ourselves.
P I E & M A P S
Processes
Improvement
Execution
&
Management
Ambition
People
Strategy
