What large businesses can learn from start-ups

Richard Conway reminds us of what makes start-ups successful, and how their principles and practices, when applied to larger businesses, can have such a profound effect.

All businesses were once start-ups. This can be easy to forget – imagine companies like IBM, Disney or Samsung only having one or two staff members! 

Big businesses have many tips and tricks that start-ups can draw on in order to help them grow. However, there’s also often-overlooked merit in finding out what makes start-ups successful, and learning how these principles and practises can positively impact larger businesses. 

Passion
Having passion is key to the success of any start-up or small business. With passion comes determination – if we aren’t passionate about what we’re doing, we’re more likely to struggle to succeed, as we won’t have the drive or energy to push through when times are tough. 

It’s easy to get caught up in the day-to-day goings on of business, but stepping back and re-identifying what makes us passionate about our job allows us to make better decisions and be more motivated to do things that we might otherwise struggle with. 

For larger businesses, understanding your employees’ passions, and identifying what excites them can help you gain a better understanding of the strengths and weaknesses of your business. By leveraging on your employees’ (and your own) passions, you’re more likely to create a business that people enjoy working for, and are more likely to invest in. 

Staff, salespeople and leaders who are truly passionate about their work are hard to say no to, and often gain a lot of traction because of their passion and enthusiasm.

Belief
Believing in what you do and the projects you’re working on can also take individuals and/or companies a long way. Start-up entrepreneurs that have a strong self-belief are likely to be the most successful, as they have the drive and determination to push through challenges. 

Businesses that instil a sense of purpose and belief in their staff create a professional journey that people want to be on. This can sometimes get lost in a large organisation due to the many personalities involved, all of whom have different ideas of what the company and job means. 

Helping your team to understand how their role relates to the bigger picture of your organisation can help to instil a sense of belief in them; that what they are doing has a purpose. This belief can also come in the form of values; however, pushing your values down your employees’ throats is not the way to get them to believe in your business. Instead, working with them to identify and adopt common values, while having a forum to address their thoughts, will strengthen their belief in what the company is working towards.

Innovation
At the heart of every start-up is innovation, the desire to fill a gap in the market, whether that be in the idea, product, service or approach. There may be a hundred companies out there providing similar services, but each one will have a slightly different offering. 

Start-ups are more likely to be innovative in their approach to day-to-day tasks, as they’re trying to differentiate themselves from the market and develop their brand, meaning they’re open to knowledge and idea sharing – whether that be with industry experts, potential clients or other businesses who are in the same pool. 

Multiple brains are better than one – if larger businesses are open to having forums for their employees to discuss what is or isn’t going well internally, they would learn a lot about their company and foster an environment of innovation and growth. 

Calculated risk-taking
Many start-up founders develop their own business to deal with an issue they have faced at some point. But without a team of researchers and developers, start-ups have to find out first-hand what their customers want, and understand the experiences their customers are having – both positive and negative. 

By gaining first-hand understanding of their customers’ experiences, start-ups excel by focusing on a specific issue. Rather than reinventing the wheel, they fine tune a service or product to deliver something better, and aren’t afraid to experiment or change direction.

Ultimately, this means they are more calculated in their approach – often developing hypothetical solutions to test, then designing for scale from the get-go, allowing them to reach their full potential and maximise the impact of the new product or service quickly. They also don’t get hung up on ‘perfection,’ as many large businesses do, and are more confident in getting feedback from the market, which allows them to refine and develop their offering.

Agility
Start-ups often don’t have huge resources, so they focus on a hypothesis that can be tested through a number of small experiments, quickly and efficiently. There is no fear of failure, but rather opportunities to learn, develop and sharpen the focus of their offering, abandoning bad ideas and testing refined ones quickly in order to capture the market at its peak. 

Start-ups are also quick to adopt new technology, which can help them develop new ideas and build on what the market has produced, capitalising on the latest technology. They can pivot without the inertia of a big organisation, meaning that if something goes wrong, they don’t have to write a report and communicate it through various channels that will deliberate over the next move. Instead, the start-up entrepreneur will see the answer or change direction quickly, and with relative ease; refocusing attention without wasting any further time, money or resource. 

Investment in people
Start-ups invest in relationships with people, as they often don’t have the capital to invest in more tangible assets. Most start-up founders know that one shouldn’t judge a book by its cover, and that living in such a transient world, especially in New Zealand, anyone could have the potential to help you at some point.  

Start-ups tend to invest in external experts, rather than having someone in-house, because they have to focus their resources where they will count most. They also understand that it’s important to collaborate with other people and organisations who can have an outward look on what their business is doing, and provide an alternative perspective.

Big businesses can learn a lot about managing resources and effective use of time from start-ups. This is often most visible when a big organisation has a decision to make, and ends up going round in circles, only to arrive at a solution that could’ve been found within the first ten minutes of a conversation. 

The most important thing that large businesses can learn, however, is the importance of people. Trusting those involved with your business (including customers) can be the thing that determines whether a large company is mediocre, or something spectacular.