Key factors of success for a startup. Is it the business model or the team?

A model is a tool for developing, verifying and implementing an entrepreneurial idea, a team is a small social group that creates a start-up personal background and the business strategy is a manifestation of the deliberate action of a start-up in a competitive environment. At its core, your business model is a description of how your business makes money. It’s an explanation of how you deliver value to your customers at an appropriate cost.

Importance of Business Model

A business model provides a framework for a company's monetization strategies. It focuses on defining the audience, unique selling proposition, brand positioning, method of delivery, and distribution channels to create a profit-making formula. Business models shape all aspects of a company's development and growth. Therefore, they may change over time to adapt to new marketplace opportunities, technologies, or distribution channels.

Business models offer insights into a company's long-term profit potential. Investors tend to focus on several areas before choosing companies to add to their portfolios: This is especially true of market size, product demand, scalability, and the ability to add new channels. These components have the most significant potential to impact net income, which is the accurate way investors measure a company's wealth-generating potential. If net income increases, the company is doing well and can be a good investment. Business models include insights into the marketplace, like customer demand, potential for reaching new customers, and expansion opportunities. These insights help investors and analysts understand whether a company has long-term profit potential.

Scalability refers to a company's ability to expand or grow with the same amount of resources. If a company is limited by geography, customer demand, service delivery, or product availability, its potential for growth and profitability is also limited unless the business model shifts.

Importance of Startup team

Organized workflow

Things move very fast in startups, what with everyone working in overdrive. There’s an awful lot to be done in a small time frame. In such a situation, it becomes extremely important to ensure that everybody is on the same page and there is no overlap of work, since that could quickly result in chaos and catastrophe. Someone needs to take charge and make sure there is active and efficient communication in the team so that the workflow stays organized.

More learning opportunity

When you work with a team, there are people whose work shares context with yours, which makes it easier for all of you to challenge each other’s ideas and grow together in the process. An individual working alone on a project will take much more time than a team will, thereby working on fewer projects and greatly reducing the number of learning opportunities. People working in startups need to learn a lot very quickly, and a good team makes sure everybody grows together.

Improved performance

The hallmark of a promising startup is its ability to roll out a good product without compromising on speed, which requires prompt decision-making and a system of quality control. If all team members in a startup work closely together, they can keep track of each other’s work, thus maintaining a consistent standard. This improves the overall performance of the startup.

So here are the top 7 reasons why you should focus on efficient teamwork in your startup. If you have any thoughts on this article or about what you would like to read next, tell us about them in the comments section.

Builds trust

The members of a startup team, though small in number, usually come from very different backgrounds and have expertise in different areas. All of them have their own style of working and their own philosophies that they stand by. Uniting such a team to work together towards a shared goal can be a difficult task. Everyone has different responsibilities and different expectations, so coordination doesn’t always come easy.

To overcome this hurdle, good teamwork is needed. This allows the team to bond over group activities and start to feel comfortable with each other. Teamwork builds trust, which is a touchstone for any team’s success.

Brillois, B. (n.d.). Successful Start-ups& Key Success FactorsA study of the Fast Growing Firms. Successful Start-ups& Key Success FactorsA study of the Fast Growing Firms, 1(1), 1. https://www.diva-portal.org/smash/get/diva2:22360/FULLTEXT01.pdf

Kim, B. (2018). Critical Success Factors of a Design Startup Business. Seoul Business School, Seoul School of Sciences and Technologies, 1(1), 10. file:///C:/Users/User/AppData/Local/Temp/sustainability-10-02981-v2.pdf

Slávik, Š. (2010). The Business Model of Start-Up—Structureand Consequences. Department of Management, University of Economics, 1(1), 10. file:///C:/Users/User/AppData/Local/Temp/admsci-09-00069-1.pdf

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