Tag: business development

5 tips for recruiting a stellar first hire for your startup - New Frontiers programme

5 tips for recruiting a stellar first hire for your startup!

5 tips for recruiting a stellar first hire for your startup - New Frontiers programme

Making the first external hire is a big step for a startup. It’s a significant commitment with all kinds of obligations and logistics to consider. In this blog, we’ll take a look at some tactics to help you make recruitment less of a risk.

Before you start, make sure you do really need to hire someone at this point. If you’re running a startup, it’s a good guess that you’re run off your feet and wish you had a second you to make the workday less crazy. However, it’s important to recognise whether this is just the typical whirlwind of getting a new business off the ground or whether the time has come to grow the team.

The first step is to take a careful look at the finances and financial projections to see if you can afford an employee. Consider all the costs associated with this – salary costs plus hidden costs such as equipment, office space, insurance, software, training, etc.

The second step is to consider which area of the business could best be supported by a second pair of hands. There should be enough workload to add up to a new role, and what needs to be done should bring real value to the business and contribute to your bottom line (for example, supply chain or customer services). If your plate is overflowing with smaller tasks that don’t add up to a particular business role (for example, bookkeeping) then rather than making a new hire you should lighten the load by outsourcing specific jobs.

Finally, be careful of making your first hire a big, expensive role. For instance, it’s not uncommon for founders to want their first employee to be the salesperson, because it’s typically a role they aren’t confident in. However, these salaries are usually very high and it can be hard to find the right salesperson on the first attempt (see more about this in our interview with Nicky Bowman).

So, having decided the time is right for your first hire, here are 5 ways to make the transition from founder to employer a little easier.

How to successfully hire your first employee

1.      Identify your startup’s weak spots

Your first hire should not be a jack-of-all-trades. In fact, no hire should be! It’s particularly tempting for startups to seek out that unicorn individual who has a bit of experience in everything. The problem with this approach is that they’re not properly solving any one problem. A much better approach is to identify specific weaknesses in your business that are taking up a lot of time or particular gaps where you can really start to grow revenue and aim to hire someone who can take this on and have a transformative effect.

2.      Document procedures for tasks

You want your new employee to hit the ground running when they arrive. Do not wait until the last minute to figure out how they are going to do what you need them to do. It’s probably clear in your mind how the tasks that need doing should get done, but don’t assume this will be obvious to your new hire. They aren’t familiar with your business or how you work yet. If you’re not used to onboarding employees, you’ll be surprised how many small things need to be communicated in the initial stages.

List the responsibilities attached to this new role and then take the time to document procedures for each one. Trust us, it’s worth it. As an entrepreneur, you’re used to doing everything yourself, which means you have your own set of standards. If you want to maintain those standards and avoid resorting to micromanagement, then procedures are a lifesaver.

3.      Don’t underestimate the importance of culture fit

Skills are not the be-all and end-all, especially at this early stage of your business. Your first hire is going to be working in close quarters with you and, inevitably, will have an influence over how your team grows. This is not the time to take a punt on the aloof genius, the rebellious leader or the troubled artist! Rather trust, integrity, and good communication skills are the kind of characteristics you want to invest in with your first hire.

If there is more than one business founder, we’d advise giving everyone the opportunity to meet with the potential candidate so they have a chance to air their opinions. The last thing you want is your office split down the middle by an employee who gets along swimmingly with one founder and is at loggerheads with the other! This exposure to key people in your business is also a great way to show the candidate that you envision them to be there for the long haul.

“I’ve turned down very good technical people. I know the team they are going to have to work in and if I don’t think they will fit in there is no point in hiring them, no matter how talented they are from a technical point of view.”

Sandra Whelan, Immersive VR Education
read our interview with Sandra

4.      Have them demonstrate their skills

It really is the only way to know for sure that they can do the job. There are many great interviewees out there. These people are personable, passionate, quick with winning answers and they’ve researched your company inside and out. But none of these attractive qualities necessarily means they will be good at the tasks you have in mind for them.

To combat this, don’t be afraid of having more than one stage in your recruitment process. It may be time-consuming, but this is not a hire you want to make in a rush. The first stage of the interview could be designed to whittle down candidates by their skillset and the second stage could be for finding out if they have the right personality fit for your company.

5.      Have a trial period

This is your first hire and there’s a lot riding on it. Feeling a little stressed about getting it right is only natural. Overthinking it won’t make it any easier, however having a trial period can take a lot of the pressure off. Recruitment is a speciality industry for a reason so if you’re not a professional recruiter, it makes sense to buffer the risk with a probationary period. Ensure it is included in the new employee’s employment contract and define clearly the duration of the trial period. Under Irish law, a probationary period must be one year or less in duration.

Making your first hire is a big decision, especially when you are bootstrapping. As with most things in business, careful planning will help you avoid the most common pitfalls. Be clear about what you expect and what you are offering from the outset, because high staff turnovers will only negate the benefit of having the extra help. Also, remember that although you will be able to move over a large part of your workload to a capable colleague, employees do require management, so factor in enough time to oversee their work. 

About the author

scarlet-merrill

Scarlet Merrill

Scarlet Merrill is Editor of the New Frontiers website and founder of her own startup, Engage Content Marketing. She is an expert in designing and executing content strategies and passionate about helping businesses to develop a quality online presence… [Read Scarlet’s profile]

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Listen to your market and always be ready to pivot your idea - New Frontiers - Pierce Dargan

Listen to your market and always be ready to pivot your idea

Listen to your market and always be ready to pivot your idea - New Frontiers - Pierce Dargan

In this blog, New Frontiers alumnus Pierce Dargan discusses his decision to pivot his business idea and what has gone into building a strong and successful startup. Pierce was careful to get extensive feedback from prospective customers and research his idea thoroughly before making his decision.

When I started working on my own business, over four years ago, it was on a very different idea. Part of the entrepreneurship module for my masters at Trinity College was working on a startup idea. Mine was a marketplace for farmers to look for products and services in their area – such as feed, fencing and manure disposal services – so they could compare prices and make informed choices about suppliers. My background is equine farming, and I felt that a price comparison site, which is very common in a lot of markets, was lacking in farming. I won a number of awards for this idea, including the Trinity College All-Tech Innovation competition.

The importance of validating your market

During the validation phase of my startup, when I started to talk to the farmers I was hoping would become my customers, many told me that price was not their biggest pain point. People generally felt that price was not the big issue for them and in fact they stayed with suppliers because of factors like quality assurance, quick delivery times or credit terms. I spoke to people across Kildare, Cork and elsewhere for this validation phase, and I was very fortunate to meet people who were honest with me about the idea before I spent both time and capital developing a solution. It is important to listen to your potential customers rather than just people in your immediate circle, such as advisors, friends and family. The customer is always the most important person.

When the people I was talking to told me price comparison wasn’t their biggest issue, I always asked what their biggest problem was. Time after time, people in equine yards told me that they were having issues keeping up with the large amounts of paperwork required because of frequently changing equine welfare regulations. Racing trainers and equestrians have to keep medication records for their horses to satisfy regulators and drug testers. Some yards have hundreds of horses, each with their own drug and vaccination regimen. It gets very complicated very quickly and if records are wrong it can lead to heavy fines and, in the most serious cases, prosecution. The yards I was talking to said that if I could develop a solution for this issue, they would be very interested.

Always listen to your target customers

It was at this point I realised that there was a large opportunity to try and build a regulatory technology system to be an education tool that would help ensure compliance for equine yards and help promote equine welfare and transparency. It was a difficult decision to pivot the idea. I had won awards for my original farm marketplace idea and it was hard to let go. However, it doesn’t matter what anyone else says, always listen to your customers. It is a common trap that entrepreneurs fall in love with their ideas and don’t listen to what their customers actually want.

Once I pivoted my idea, I knew I would need a CTO who had experience in digitising regulatory paper processes. It just so happened that I ran into a friend from secondary school, Simon Hillary, who had just finished optimising workflows from paper to digital systems for the Oireachtas. Simon came on board, and we started the process of getting our system deemed compliant as a medicines register by the Turf Club (the horseracing regulatory body) here in Ireland and their equivalents in the UK and France.

Early-stage development with support and funding

I completed Phase 1 of New Frontiers at IADT mid-2017. From there, we were accepted onto the Trinity LaunchBox, and I completed Phase 2 of New Frontiers as well. Our Local Enterprise Office has been very supportive, and we’ve had a priming grant and business expansion grant from them. This has all been very helpful, because in all pivoting the idea took two years – refining our solution and getting into the finer details of the regulation.

By 2018, we were ready to launch with an initial cohort of users. That’s when my brother, Finlay, who has a background in finance, joined as our COO. Our app manages the whole compliance process for yards, centrally tracking the what, when, why, and how of medications being administered. Trainers or owners can invite vets and staff onto the system so that everything is tracked and recorded safely and securely.

Our pivoted startup: Equine MediRecord

We already have hundreds of yards on our system across Ireland, the United Kingdom and France, tracking thousands of horses. Our system is the first and only system to be approved as compliant to replace the paper regulatory documents, and the only system in the world ensuring compliance in the equine industry. We won a number of competitions, including the One Zero Conference, ‘Best Use of Mobile’ at Energia Digital Media Awards, and Most Innovative Equine Technology in the UK. We were also accredited with the Business All Star in ‘Regulatory Technology’ at the All-Ireland Business Summit. I also made it into the final 24 (out of 1,600+ applicants) of Ireland’s Best Yound Entrepreneurs, representing the Irish Midlands Region and Kildare at the national competition in September.

As we all become more aware of animal welfare issues, regulations are being strengthened and people need systems to ensure medical record compliance for their animals. Equine MediRecord is looking to enter new markets by the end of the year; we’ve just signed clients in the USA and Argentina and are talking to regulatory bodies inside and outside Europe. We’re also diversifying into other types of equine activity, such as horse breeders and polo teams. None of this would have happened if I had fallen in love with my original idea and been unable to pivot.

About the author

Pierce Dargan Equine MediRecord New Frontiers alumnusPierce Dargan

Pierce Dargan is a fifth-generation racehorse owner and breeder, ex-professional rugby player and New Frontiers alumnus. He is the co-founder of award-winning tech startup, Equine MediRecord… [Read Pierce’s profile]

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4 actions entrepreneurs need to take to scale up quickly

4 actions entrepreneurs need to take to scale up quickly New Frontiers Entrepreneur programme (1)

4 actions entrepreneurs need to take to scale up quickly

4 actions entrepreneurs need to take to scale up quickly New Frontiers Entrepreneur programme (1)

So, you think your startup is scalable. You’ve looked at your turnover, you’ve studied the market and you believe your business could handle a bigger piece of the pie. That’s great, but growing your business successfully requires not only a shift in operations but a change in mindset.

With all the research and speculation that goes on in the business industry, you can be sure there are known habits and practices that successful entrepreneurs adopt to grow their business. We’re going to share a few of them with you to get you started on your road to success.

Scale up your startup with these great business tips

1) Visualise success and set a deadline for it

The first step to getting where you need to be is to visualise success for your business in practical terms. Try asking yourself, what does my business look like at double or triple the value? “Scaling up” is a nice idea and a handy phrase to throw around when talking to investors, but it doesn’t come with a guidebook tailored to your business. The good news is that you know your business inside out and you know what resources are available to you. Use this knowledge to drive real action that contributes to business growth. Visualise what you want to achieve, give yourself a deadline to get there and then design a map. As with any goal, the deadline is crucial, so don’t be tempted to skip over that part!

2) Stop micromanaging and start delegating!

We’re sure you’ve heard this one before, but the question is, have you actually put it into practice yet?? There is no understating how important delegation is when it comes to growing your business. As an entrepreneur, you’re used to wearing many different hats and taking an all-hands-on-deck approach to everything you do. It’s this trait that makes the entrepreneur who they are, but you need to recognise when the time has come to take a step back and work on the business rather than in it.

To use the cliché, a healthy business is like a well-oiled machine, meaning it can run on its own. Your role needs to change from a management one to a leadership position so your business can have true value that exists beyond your name and your personal network. It’s time to create a strong senior management team that you trust to make important decisions on a day-to-day basis. When you have successfully done that, the next thing to do is to take a holiday. Yes! That elusive thing people with extra time do! If the business can run itself for a week or two, then pat yourself on the back because the value of your business has just increased.

3) Outsource the nonessentials

We recently wrote a blog covering this topic in more depth to help entrepreneurs decide if outsourcing is right for them or not. Have a read of it, and if you find it does make sense for your business, then we advise you to get going on it! Outsourcing is a fantastic way of getting access to high-quality skills at a cost-effective price. By outsourcing the nonessentials, you can focus on what you do best, streamline your processes and invest in the areas that really matter for business growth. As for those areas you can’t afford to outsource, automate them as much as possible.

4) Share wealth and opportunities amongst your team

We have already recommended that you should delegate by building a strong senior management team. However, if you’re going to invest in doing this, then you would want to make sure these key employees stick around for a while. For any business looking to grow, a high turn over of staff is a killer and a clear sign that something has gone wrong at the heart of your business. Hard working, loyal and talented people who want to help your business grow are vital to the lifeblood of a business looking to scale and you simply won’t compete on an international scale without them.

It’s a good idea to share wealth and opportunities amongst your key team members. This means not only paying your employees what they’re worth but incentivising them in other ways, such as offering them opportunities for self-development, investing in team bonding (whether that’s on-site or off-site), creating a pleasant workplace that has its own distinct character and perhaps even offering them shares in the company. Finding star employees is hard and so is keeping them, so it’s worth taking the time to make them feel valued because they are essential to the growth of your business.

If you’ve just finished the New Frontiers Programme, you might be wondering what comes next. If you’re looking to scale, you should definitely keep an eye out for the next Competitive Start Fund call. Providing access to fantastic one-on-one mentorship opportunities as well as funding, you’ll get all the support you need to take your business to the next level!

About the author

scarlet-merrill

Scarlet Merrill

Scarlet Merrill is Editor of the New Frontiers website and founder of her own startup, Engage Content Marketing. She is an expert in designing and executing content strategies and passionate about helping businesses to develop a quality online presence… [Read Scarlet’s profile]

Other articles from the New Frontiers blog

Winners of Ireland’s Best Young Entrepreneur Awards (IBYE) announced

Immersive VR Education builds on startup success with a strong team

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A framework for founders: how one VC thinks about pre-seed investments

A framework for founders how one VC thinks about pre-seed investments - New Frontiers

A framework for founders: how one VC thinks about pre-seed investments

A framework for founders how one VC thinks about pre-seed investments - New Frontiers

‘When Frontline say we invest early, we mean it.’

At Frontline, 70% of our investments have been pre-revenue and 60% pre-product. At Pre-Seed and Seed, there is little to be learned from intensive quantitative analysis pre-investment (woo). That said, over the past year and a half at Frontline, I’ve built a qualitative framework, designed around four key questions, to help me quickly assess the companies I meet. Together, I believe that these four questions are critical in predicting success. 

1. Can you convince me to quit my job?

The first question I ask myself is, would I quit my job at the fund and work for these people on this problem? I know, it seems like a completely crazy idea, you (the founder), are here for the VC’s money, not to get them to join your team. Consider this though; when you pitch to a VC, you are looking to inspire and excite. At our stage of investment, it’s about taking a leap of faith and believing in your vision and your team’s potential. Surely, this is also what you do when pitching talent you are looking to hire. So, if you can convince a VC to invest in you, great. If you can get a VC to actually join your team, all the better.

Sarah Tavel was so excited after meeting the founder of Pinterest that she invested and swiftly left Bessemer to join the company. Pinterest is now a $15 billion business. It wasn’t that way when Sarah joined — it was still another startup trying to break through the noise.

So, why is this is a good heuristic to access early-stage companies? The key assumption we’re making in venture is that you’re going to build a big business and the essential ingredient in building a big company is the ability to hire the best. In the early days, you’re unlikely to be competing on compensation, option grants are a long way from ever paying the bills, and the hours will likely be long and hard. The one thing that will attract top talent is your ability to tell a compelling story, display a truly unique insight into the problem you’re solving and to be overwhelmingly impressive when you first meet candidates. The team isn’t assessed just on who’s in the room, it’s imagining who might be in 12 months time.

2. From Chihuahuas to exit, can you find a big enough market to scale?

At Frontline, we track all the reasons why we pass on companies — market size, competitiveness, price, strength of team, etc. We then review all the companies we’ve passed on and check in on how they’re doing using the metric of funds raised (not ideal, we know, but it’s a simple public indicator of success).

Surprise, surprise; our data has shown us that multiple cases where we liked the team but passed on the opportunity because we thought the market was too competitive, we were often wrong. The reality is that good teams can succeed in hot markets. In those cases where we also liked the founders, but passed because we felt the market was too small, we have found that founders go on to struggle.

“When a management with a reputation for brilliance tackles a business with a reputation for bad economics, it is the reputation of the business that remains intact.”

Warren Buffett

Warren Buffet lives by this mantra and the data proves it.

Even if you’re good — when you go after a small market in the early days you tend to go deeper into the niche rather than expanding outwards. This can cap your upside and in venture, if we don’t think there’s a viable route to an investment returning half our fund, we are likely to pass on it. Here’s how that practically plays out, on the back of an envelope:

  • Frontline Ventures Fund II: $70 million
  • Target ownership at exit: 10% – 20%
  • Required company value at exit: $150 million – $300 million
  • B2B SaaS forward revenue exit multiples: 5x – 10x (if growing minimum 2X YoY)
  • Company revenue required at exit: $15 million – $60 million
  • You can usually never expect to own more than 10% of any market, so the smallest addressable market we consider for an investment is about $150 million — in reality, to find that market segment you need to look for +$1 billion markets (or be able to make the case that the market is growing or that you can create it)
  • This is fund by fund. Some funds don’t care about ownership/exit multiples – they just care if they think you can build a $10 billion company and can they get a slice of it.

Larger target markets give you flexibility in the early days to figure things out. Longer-term, you must then narrow your focus as you get closer to your customer because once you go deep on a customer segment, it becomes much harder to get back to a larger market without pivoting the company.

One of the best (non-software) examples of this is Chihuahuas. (Yes, you read it correctly). Imagine you’re starting a pet-food business and you decide to start with gourmet, home-delivered meals for Chihuahuas. Let’s say it’s a $50 million market (🤪) that no one is addressing specifically, you can get a big slice of this right? Sure, there are plenty of Chihuahua owners. Plenty of them might have a high willingness to spend on their dogs’ health. But what if it turns out Chihuahua owners aren’t as loose with their wallets as you thought? You’ve gone too deep too early and now all that adorable marketing collateral goes into the bin.

What you could have done is start with the pet food market (multi-billion dollar market). Move down into the dog food market (still multi-billion dollar market). Then go gourmet. Still a huge market and very competitive. But if you follow the rule that you’re never going to own more than about 10% of a market in a best-case scenario, it is always wise to target the larger opportunity. Chihuahuas might turn out to be the right answer — but so might the Maltese or perhaps Pugs. (Analogy inspired by the very cool Butternut Box.)

3. Can you spot the shift beneath your feet?

The world is changing by the day. Yet, major shifts in platform and underlying technology only really happen once every couple of years. The shift to mobile in 2009/10 and the shift to cloud in 2012/13 spawned dozens of new unicorns. In the UK, the opening up of financial regulation in 2014 has since spawned some of the most successful breakout European companies in recent memory.

Often the way these changes empower startups is by opening up new distribution channels. Founders are up against sophisticated sales teams with great brand awareness and multiple routes to reach their customers. But what these incumbents gain in scale they lose in awareness and speed. New routes to customers inevitable open up – and founders that can find these channels early are on their way to building great companies.

One of the best examples of this is the rise of self-serve in SaaS. Founders like Melanie Perkins of Canva that recognised the early trend rode the wave of lower acquisition costs and viral distribution when it was at its peak, and has now built a huge company. Older companies such as Hubspot had to transition from an inside sales-driven growth model to a freemium product-led strategy. For a company like Hubspot, making that transition is expensive and hard. As a startup, you can do it tomorrow.

As a founder, it’s important to recognize key changes in technology and/or customer behaviour that will allow you to create new value. Was there a missing piece of functionality that previously did not exist, and that you can now leverage? Old products become bloated by features whilst new paradigms make better, faster and cheaper products possible. This is a startup’s opportunity. Think about mobile-GPS enabling ride-sharing and food delivery, or AJAX enabling fast content consumption in a browser, or accessible machine learning frameworks like TensorFlow opening opportunities for new analysis.

4. Who are your beachhead customers?

Finally, when meeting new founders, I am always looking for beachhead customers. If a product is to be adopted by new customers, a general rule of thumb — pulled from Zero to One — is that it has to be 10 times better than the existing alternative.

Of course, on day one your product isn’t going to be 10x (lol) better for all your potential customers. It’s not even going to be close for a lot of them. But customer pain is a sliding scale. For most customers, your initial product might only be a 2/3x improvement. But there will be a group for whom the pain you are solving is most acute.

Find these customers and obsess over solving their problem. When you do, nurture them. Grow a loyal and effective group of early advocates who love your solution. Leverage this group to raise capital and as you develop your offering you’ll find you’re a 10x solution for more and more of the market.

TL;DR

Early-stage VCs don’t look that closely at the product or the technology as those are rarely the things that trip up early-stage founders. It’s almost always one of the below:

  • The team isn’t right.
  • The market is too small.
  • The market isn’t ready.
  • The company is unable to find early customers.

If you’re speaking to us, know that this is the lens through which I evaluate an opportunity. I know it isn’t perfect, but I hope this gives you some guidance on how to shape your approach. And, if a VC turns you down, don’t be too disheartened. I got turned down by Frontline when I was in the early days of fundraising.

There are myriad reasons why you can be rejected; some subjective, others less so. At Frontline, we try to give constructive feedback to all the companies we engage. It can be hard to tell a founder you don’t believe in them personally, but more often than not, that’s the real reason. For founders, figuring out why VCs make the decisions they do is another part of what it takes to build a big company.

And remember, the ‘picking’ part of venture is tough. It’s as much our job to get it wrong as it is to get it right (+50% of pre-seed investments fail). But we want to partner with founders as early as possible – and as soon as you have a vision and a plan together. Ping me on finn@frontline.vc if you want to chat or just tell me why most of the above is wrong.

About the author

Finn Murphy Frontline Ventures New Frontiers programmeFinn Murphy

Finn Murphy is an Associate at Frontline Ventures, an early-stage venture fund specialising in B2B software. He loves working one-on-one with entrepreneurs and helping them find their path to building world-changing companies… [Read Finn’s profile]

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New Frontiers - the food business when is a trend not a trend

The food business: when is a trend not a trend?

New Frontiers - the food business when is a trend not a trend

Understanding and using trends to develop sound business opportunities can be a complex area. In the food sector, for example, there are numerous macro and micro trend reports published every year, but what does a start-up food company really need to consider, when determining whether an idea is actually commercially viable?

Trends can mean different things to different people. It’s a much bandied about term, mainly used to describe things that are currently popular or that are predicted to become popular. Essentially, broad shifts in consumer behaviours, attitudes and values drive changes which become identifiable, marketable trends.

Typically, trends are (or should be) the starting point for a good business idea. A way of quickly and inexpensively road-testing your idea is to assess it against the key trend indicators for your sector. Your idea should meet a clear and defined need, solve a problem and align with at least one trend.

The 7 real trends shaping the food industry

Without fail, at the start of every year, a deluge of lists emanates from a myriad of sources, telling us what we ate last year, what we will be eating this year and, of course, what we should be eating. These lists are fun to read, but are linked in many ways to what is being sold by the source, whether it is a data house looking to sell more reports; food delivery companies promoting their businesses; or chefs/food gurus/influencers looking to build their profile.

The question is, how can you discern the wheat from the chaff? What’s a real trend versus a fun fad? It’s clear that a focus on health, community and the environment have taken centre stage of late in the food sector, along with a keen focus on “management of self” in a frantic, always-on, digital era.

Below is my take (please note, far from exhaustive!) on some key trends that a food start-up needs to consider before taking the plunge, along with a few examples of products that meet the trend test.

Food industry trend #1: Changing Meal Patterns

What some commentators describe as the “Fourth Meal”, this trend reflects the growing fragmentation of eating occasions. In our topsy-turvy and less structured world, with mobile and flexible working becoming the norm, breakfast has morphed into lunch and snacks have become mini-meals. Also, the final meal of the day is often a treat more than sustenance, which brings its own challenges. Products such as nutritional bars – a substantial and relatively healthy snack – have been trailblazers in this trend, with Fulfil at the forefront (followed by a long tail of competitors).
Food industry trends - Orla Donohoe - New Frontiers

Food industry trend #2: Health is Wealth

Food & Beverage products in the health space cover a vast spectrum of interest areas and preferences, including disease prevention and holistic well-being all the way through to practical health management tools. Products that claim to aid sleep are a new phenomenon as people find it increasingly difficult to unwind, digitally detox and prepare for rest in the evening. Hot beverage brands such as House of Tea have capitalised on this trend by promoting the features and benefits of variants such as their “Sleep Well” product which has very specific (relaxing) ingredients.

Food industry trend #3: Nutritional Nurturing

It can be very difficult to communicate positive health messages to children that aren’t boring for them and at times it feels that a constant battle is being waged against sugar, which the parent is doomed to lose. I have therefore been eagerly awaiting the arrival of newly launched Hidden Heroes in my nearest Dunnes, and am hoping that my young son will no longer refer to vegetables as the “emeny”. The brainchild of Aileen Cox Blundell, these are junk-free vegetable snacks with 100% natural ingredients which tick all the boxes. Convenient (frozen), guilt-free (quality product) and with a razor focus on a child’s nutritional needs.

Food industry trend #4: Real People, Real Food

The artisan movement is no longer niche and there is huge interest now in knowing where your products come from and who has made them. On social media platforms, posts relating to product provenance generate strong engagement and empathy and add significantly to the user experience. Earlier this year, a small company in the west of Ireland garnered huge publicity following an appearance on a business makeover programme. Aran Islands Seaweed Pesto, an authentic product produced by likeable, relatable people, charmed the public as their journey from idea to product on a plate was shared. Catnip for Millennials.
The 7 real trends shaping the food industry - New Frontiers

Food industry trend #5: Kits are King

Meal kits are one of the fastest-growing segments in the market and have extended in all sorts of directions. Not just focused on meals any more, there are now kits for bread, cakes, biscuits, condiments, cheese and even beer. My absolute favourite is the recently launched Gin Fusion Kit from the Dublin company Drink Botanicals, which aims to enhance the gin experience. Interestingly, in the US, Amazon has introduced a new range of meal kits in Wholefoods, which link with Alexa-enabled devices to provide recipes and cooking instructions – appealing to gadget lovers who also seek convenience.

Food industry trend #6: Plant Protection

Interest in plant-based proteins is at an all-time high. Even children in their early teens (and sometimes younger) are choosing to follow meat-free diets. My own locality of Stoneybatter on Dublin’s north side could well be a candidate for vegan capital of Ireland (three vegan restaurants opening in the last few months). And it is becoming mainstream. California-based vegetarian burger company Beyond Meat has been the best-performing public offering in the US this year, currently holding a market capitalisation of $11.2bn, above Macy’s and Trip Advisor. Definitely not niche.

Food industry trend #7: Green Me

Now more than ever, there is a strong and growing sense of personal responsibility to effect positive changes and address the world’s increasingly pressing and worrying environmental issues. Reducing usage of packaging (especially plastics), commitments to green causes, effective management of food waste – consumers now demand and expect that food (and other) businesses will take their concerns more seriously. There are many great examples here however I particularly like Insomnia’s Mission Compostable campaign, which aims to replace all single-use items with either reusable or compostable alternatives by 2020. Clear, time-bound and accountable.

When you are sure your service or product meets at least one clearly identified trend, the first and most pertinent piece of advice you will receive on New Frontiers and elsewhere is to validate it. Be aware that research can be maddening! Just when you are sure your proposition is fully birthed and ready for launch, someone will throw a curveball. When this happens, take a deep breath. Embrace the feedback. Make any necessary changes, taking advantage of the many resources that are available. And above all, enjoy the experience, as I did.

About the author

Orla DonohoeOrla Donohoe

Orla Donohoe is a trends analyst, food sector advisor, and content writer. She has a background in international business development, and a career spanning over 20 years in market and client facing roles in Bord Bia’s Dublin, London and Madrid offices… [Read Orla’s profile]

Other articles from the New Frontiers blog

Winners of Ireland’s Best Young Entrepreneur Awards (IBYE) announced

Immersive VR Education builds on startup success with a strong team

Startup events to help you end 2019 on an entrepreneurial high

A new cohort commences Phase 2 at GMIT’s Innovation Hubs

How to decide whether to outsource or keep everything in-house - New Frontiers

How to decide whether to outsource or keep everything in-house

How to decide whether to outsource or keep everything in-house - New Frontiers

Growing your business beyond the startup phase means making some big changes with regard to how your company operates. In a startup, it’s an all-hands-on-deck situation for the close-knit team; communication is a breeze because the company isn’t a sprawling organisation yet and at any given moment you, the founder, can be found jumping between roles, keeping tight control over everything.

However, as you scale up, it quickly becomes apparent that the advantages that made you a startup success could now be the very things that are holding you back. The small team needs to grow so you can keep up with demand and remain competitive, it’s no longer efficient for you to be the last one to sign off on everything and each department in your company needs to start regulating themselves.

As you figure out how to navigate this evolution of your business, there will be a big question that you’ll have to answer early on, and that is “Should we outsource, or should we keep everything in-house?” We’ve narrowed down the primary determinants when considering this question to 1) Expertise, 2) Cost, 3) Time, and 4) Control. In this blog, we’re going to look at the pros and cons concerning each to help you decide which is the best solution for you.

The pros and cons of outsourcing vs keeping it in-house

Expertise

Your business has a core skillset that allows you to offer certain products and services in the marketplace, so it makes sense to keep these types of skills in-house. However, when it comes to other areas – such as marketing, IT, accounting, or recruitment – you may find your team is lacking. You can hire individuals with these skills, but how many people will you need and at what level of experience? Do you have the right knowledge to be able to recruit the correct individuals for the role?

One of the main advantages of outsourcing is that you get immediate access to a team of specialists highly skilled in their area. Rather than hiring someone who knows just a thing or two about IT, for example, outsourcing provides you with technology experts dedicated to getting you results. On the other hand, you may prefer growing your expertise from the inside so you can ensure you have your own stamp on every project while also learning from experiences.

Cost

Outsourcing is by far the more cost-effective solution when compared to an in-house option. The outsourced agency doesn’t require benefits, training, space, tools, holiday pay, or a Christmas bonus. You don’t have to waste resources on a recruitment process, and instead of paying a salary, you only pay for hours worked or input received. Some will say that this doesn’t matter if there is a loss in quality, which can happen when you give an outside source control over an aspect of your business. However, this is simply a matter of doing your due diligence before choosing which outsourced agency or consultant to partner with.

Time

One of the primary motivations for outsourcing is because it gives you more time to focus on your business. Many hours can be eaten up trying to get to grips with financial budgets, marketing analytics, or troubleshooting technical difficulties if these are not your areas of expertise. However, you will only save time by outsourcing if you have good communication channels available.

There are four main reasons why working with an outsourced company can prove problematic if communication is a problem:

  1. Projects slide because you’re not used to working with people remotely.
  2. Project briefs are not clear enough, therefore resulting in inaccuracies and multiple revisions.
  3. You haven’t built up a proper level of trust with your outsourced agency and end up spending a lot of time micromanaging their work.
  4. You and your outsourced agency are working in different time zones.

However, it is worth noting that most of these problems can occur with bad in-house time management as well. Employees working from home can become isolated from their team, vague briefs can result in mistakes, micromanaging employees can take up a lot of time and, if you have expanded internationally, you may find your team is working across different time zones. The lesson here is to find a way to improve those communication channels early on in your business’s progression, whether you choose to outsource or not.

Control

Working with an outside firm is often viewed as a partnership rather than an employment situation. Therefore, instead of having ultimate control over employee work processes, determining how you prefer things to be done from start to finish, you have a situation in which you hand over a project to a team of experts in another company and they get you results their way. Of course, you will be able to specify certain details, such as how many leads you want, the budget, the expected outcome, etc., but the core impulse behind outsourcing is that you recognise the agency to be more experienced than you in a certain area and that is why you are willing to hand over control to them. You have to decide whether this is something you are happy to do when deciding to outsource a service or keep it in-house.

Scaling up? Enterprise Ireland provides funding for established SMEs in areas such as developing your management team, market research and internationalisation, developing your management team, productivity and business process improvement, as well as company expansion. Find out more on their Established SME funding page.

About the author

scarlet-merrill

Scarlet Merrill

Scarlet Merrill is Editor of the New Frontiers website and founder of her own startup, Engage Content Marketing. She is an expert in designing and executing content strategies and passionate about helping businesses to develop a quality online presence… [Read Scarlet’s profile]

Other articles from the New Frontiers blog

Winners of Ireland’s Best Young Entrepreneur Awards (IBYE) announced

Immersive VR Education builds on startup success with a strong team

Startup events to help you end 2019 on an entrepreneurial high

A new cohort commences Phase 2 at GMIT’s Innovation Hubs

A strong employer brand is essential for attracting top talent - New Frontiers programme Ireland

A strong employer brand is essential for attracting top talent

A strong employer brand is essential for attracting top talent - New Frontiers programme Ireland

At the beginning of 2019, the unemployment rate was the lowest it has been in 10 years, at 5.3%. This is good news, but it also means that Irish SMEs are struggling to attract and retain top talent. There is no denying that a high salary has a reliably magnetic effect, but it is far from the only reason why people choose to work where they do and how long they stay with a company.

FDI companies are enjoying a large slice of the talent pie with 229,057 people currently employed in the sector, making competition fierce for smaller indigenous businesses. For Irish SMEs wanting to attract the right people with the right skills, it is vital to tap into these other draws and having a strong employer brand is a powerful enticement for job seekers.

What is an employer brand?

Having an employer brand is how you market your company to job seekers. Just like with the marketing of products and services, the promises you make to jobseekers should be fulfilled at all stages of the recruitment process and followed up on in the work environment. For example, if you market your company as “daring, innovative and fun” but then the job candidate quickly finds out that the office space is a cardboard cut out of every other office they’ve seen and their interviewer comes across as stern and a sticker for the rules, the expectations that brought them to your door in the first place have been shattered. This is why is it important that your employer brand is a clearly defined personality for your company which is holistically incorporated into every aspect of the organisation.

How do you create an employer brand?

Considering that the average person spends a third of their waking life at work and that people are more aware than ever before of the importance of a healthy work/life balance, where someone chooses to work is a serious consideration for them. Therefore, if you have the ability to offer benefits and perks that people with the skills you desire would appreciate, then it makes sense to construct an employer brand that acts as a platform for these advantages. But what does this look like in practice?

Case study: Lush

A great example of employer branding done right is the cosmetics retailer, Lush. When Lush holds their open call recruitment events, they truly are an event! Hopeful job seekers are known to queue for hours to be in with a chance of working as a sales assistant at Lush. But why? For anyone not in the know, Lush on the surface would appear to be your typical high-street retailer that pays their employees an average wage without commission. The hype all comes down to their employer branding, which they’ve perfected.

Lush’s employer brand is all about injecting positivity, fun and a heavy dose of quirkiness into life while also being steadfastly ethical and environmentally conscious. Lush defines itself as being a challenger of the status quo, a champion of individuality and relentlessly passionate about everything they do. Vibrant colours, bold images and a generous amount of sparkle dominate their image and they employ a complementary informal brand voice. Their typical customer identifies intimately with the brand and many fans, or “Lushies” as they call themselves, even help Lush spread the word about new products with their organic user-generated content. It makes sense that more often than not Lush’s employees are also their customers.

In keeping with their branding, you won’t hear humdrum questions such as “Where do you see yourself in 5 years?” during a job interview, but rather they’ll ask “Which fictional character do you think is most like you and why?” Staff frequently have opportunities to exercise their creativity by submitting and implementing concept and design ideas for seasonal campaigns. When an employee’s birthday comes around, they will get to have the day off and employees are regularly invited to participate in Lush industry events. With passion being a key Lush trait, employees get to try new products for free and enjoy 50% off all products so that they are truly invested in what they are selling.

More than a job

What Lush has managed to do is create an employer brand that is also a lifestyle choice. People want to work there because they feel that Lush represents them in more ways than simply a job title. In this scenario, employees feel valued for who they are as individuals and not just for the skills they provide. When you show your employees that you value them, they become ambassadors of your brand and when that happens attracting and retaining staff is no longer a problem. The key to a successful employer brand is the crafting of a story that people want to be a part of and proving the truth of that story throughout the employee experience.

If colour and sparkle don’t feel like the right style brand for you, remember that Virgin, The Boring Company, Google and The Walt Disney Company all are examples of successful employers brands with very diverse company personalities and employee benefits. Your employer brand is only limited by your imagination!

About the author

scarlet-merrill

Scarlet Merrill

Scarlet Merrill is Editor of the New Frontiers website and founder of her own startup, Engage Content Marketing. She is an expert in designing and executing content strategies and passionate about helping businesses to develop a quality online presence… [Read Scarlet’s profile]

Other articles from the New Frontiers blog

Winners of Ireland’s Best Young Entrepreneur Awards (IBYE) announced

Immersive VR Education builds on startup success with a strong team

Startup events to help you end 2019 on an entrepreneurial high

A new cohort commences Phase 2 at GMIT’s Innovation Hubs

Financial advice every entrepreneur needs to hear - New Frontiers - Ireland (1)

Financial advice every startup entrepreneur needs to hear

Financial advice every entrepreneur needs to hear - New Frontiers - Ireland (1)

Make sure the money coming in is more than the money going out – that’s the crux of accounting, right? Well, that’s not bad advice, but it’s not exactly helpful either. The day-to-day, month-to-month monitoring of a company’s finances requires a more detailed approach if you aim to make a profit, identify new opportunities and grow your business.

If you want your company to thrive beyond the shaky startup phase, past the inevitable “bad year” and towards a stable and profitable future, then you need to ensure your company is financially healthy. What does that mean? A financially healthy company has the appropriate strategies in place to maintain regular cash flow, be protected during rainy days, secure profits, invest wisely and be ready to scale up. If that sounds good to you, then check out our 4 financial tips below that will whip your finances into shape.

4 financial tips for startups

1. Tighten up your cash flow

For most startups, the issue with cash flow is lagging debtors. Debtor days is how long it takes a client to pay you for your services and chances are some of your debtors are more casual about it than you’d prefer. At the beginning, when you’re trying to get your business off the ground, slow debtors can cause a lot of stress and frustration. The best thing you can do is nip this in the bud from the being.

Firstly, decide if you can afford to provide a credit period. If you can’t, then you need to plainly outline this in your service contract. Some companies ask for part of the payment up front. However, if you are going after bigger, more established clients, chances are they will expect a credit period that can range from 30 to 60 days. Manage this by setting a clear credit period that suits you and prompt clients to pay with a friendly reminder approaching the end of their payment window. If this goes unrecognised, have a second reminder quickly sent from a more senior team member. If you still have no success, then send a legal follow-up and stop doing business for this client until payment comes through.

If you are trying to build up a book of clients in the early stages of your business, this approach may sound aggressive, but in the long run it’s better to have an established process in place to manage debtors because it directly affects your cash flow which is the lifeline of your business.

2. Get financial and tax advice

If you’re not an accountant and you don’t employ the services of an accountant, then chances are you are missing out on many opportunities to make tax savings for your business. From Entrepreneur Relief to Startup Refunds for Entrepreneurs (SURE) to R&D tax credits, there is a lot of support available in Ireland for startups. A financial advisor that specialises in small businesses can provide you with invaluable tax advice that is vital for giving startups the breathing space they need to grow.

There are also numerous state and private funding sources for startups, from microfinance loans to incubator funding to angel investment. A good place to start is your local LEO, and the Enterprise Ireland website also has extensive information on their funding supports (so both tax saving and funding sources). Of course, we can’t but mention our own programme, New Frontiers! We are Ireland’s only national entrepreneur development programme, and as well as providing office space, mentoring, and training, the New Frontiers programme offers Phase 2 participants a €15,000 tax-free stipend.

3. Have access to a bank overdraft

Getting a loan and being financially healthy may sound contradictory, but bear with us! We’re returning to the issue of cash flow. Let’s say for some reason or another your business stops making a profit for a few months. Perhaps your premise was flooded, or you lost a few big clients in a row. Do you have a strategy in place to weather the storm?

Bank overdrafts are not always easily accessed when you suddenly need one. After all, what bank wants to loan money a business when it’s failing? It is much better to set up this facility in advance, when your balance sheet is looking healthy. That way everything is ready to go when disaster strikes, and guess what? With this lifesaver overdraft facility at the ready, it’s not such a disaster after all. It’s just another bump in the road on your way to success.

4. Consider outsourcing

When you’re expanding your business, you might imagine everything you do will be inhouse because you want to retain as much control as possible. However, outsourcing can be a lot more cost-effective if your ambition is to scale up. Doing everything yourself makes sense when you’re a startup, but if you plan on growing your business then this can prove too costly. Hiring an in-house team of marketers or accountants or IT professionals is expensive, and that’s before you take into account the office space and equipment that comes with them. Outsourced services don’t only make financial sense, but you also gain access to the valuable insights of experts in their field. Now you can focus on what you do best and save money at the same time.

If you have a startup idea and would like to take it to the next level, read more about the New Frontiers programme and see our calendar of upcoming application deadlines around the country.

About the author

scarlet-merrill

Scarlet Merrill

Scarlet Merrill is Editor of the New Frontiers website and founder of her own startup, Engage Content Marketing. She is an expert in designing and executing content strategies and passionate about helping businesses to develop a quality online presence… [Read Scarlet’s profile]

Other articles from the New Frontiers blog

Winners of Ireland’s Best Young Entrepreneur Awards (IBYE) announced

Immersive VR Education builds on startup success with a strong team

Startup events to help you end 2019 on an entrepreneurial high

A new cohort commences Phase 2 at GMIT’s Innovation Hubs

Unleash your inner cyborg and start automating tedious work tasks! - New Frontiers - Enterprise Ireland

Grow smarter and faster by automating tedious work tasks

Unleash your inner cyborg and start automating tedious work tasks! - New Frontiers - Enterprise Ireland

The buzz around automation is only intensifying as companies continue to discover new ways technology can make businesses smarter and more efficient. The human element of work is evolving as we get better at using technology to our advantage, allowing us to give more time to the areas that need our attention the most. In fact, our relationship with technology has become so symbiotic that leading tech entrepreneur Elon Musk believes we are already cyborgs!

The definition of a cyborg accord to Oxford Dictionaries is:

“A fictional or hypothetical person whose physical abilities are extended beyond normal human limitations by mechanical elements built into the body.”

Your smartphone may not be directly wired up to your brain just yet (watch this space, Musk is working on ‘neural lace’) but as he explains, “You can answer any question, you can video conference with anyone, anywhere. You can send messages to millions of people instantly. Just do incredible things.” The question is, are you ready to embrace your inner cyborg? If you are then you’ll find you can easily automate tedious work tasks with your not-so-secret superpower – technology.

5 ways to automate tasks in your company

1. Clean up your inbox!

We might as well start with the bane of your working life – your inbox! The emails never stop coming, and god forbid you should go on holiday because when you return you’re going to have to spend a whole day tunnelling through that backlog! The average worker receives 121 emails a day and sends 40, so how can automation help?

Most email platforms, such as Gmail and Outlook, have inbuilt automation tools so you can easily categorise emails by importance. Smart Labels in Gmail or Rules in Outlook allow you to automatically sort your incoming emails based on the sender’s details or keywords. Both email platforms allow you to schedule emails to be delivered at a specific time. You can do this in Outlook by clicking the more options arrow in the ‘Tags’ section of your email or use the plugin Boomerang for Gmail. You can also design email templates for messages you find yourself sending repetitively to save time and avoid errors.

2. Start using voice-to-text software

Sometimes it’s the simplest pieces of technology that can save the most time at work. No one marvels at the wonders of a calculator anymore, but it is one the handiest pieces of office equipment! This is the kind of automation we need in other areas of our working life, a solution that completes a task quickly and precisely every time. Voice-to-text software is just that. Dictation solutions have come on leaps and bounds in recent years and for anyone who finds themselves writing at length on a daily basis, this is a must! If you’re looking for a free version, GoogleDocs Voice Typing is a great choice.

3. Be an automation whizz with Zapier or IFTTT

If you’re serious about automating tasks at work, then you probably have heard about IFTTT and Zapier before. Both applications allow you to sync various solutions so that you can have your Gmail talking to your Dropbox account, or your Twitter triggering messages in your preferred Slack channel. These platforms perform by letting you design rules that in practice look like this: if X occurs then Y must happen.

X could be your company name being tagged on Twitter and Y could be the notification of this in a Slack channel. This one would be very handy for the marketing department, but there are useful rule combinations for everyone in the office. If you’re not sure what you need automated, that’s not a problem – take a look at their library of predesigned rules and find out what’s popular with other users.

4. Get real financial insights with Xero or Bullet

Human error is inevitable, but you don’t want it to happen in your financial accounts. Accounting solutions such as Xero and Bullet (an Irish company) can help you automate repetitive tasks while also providing business intelligence that would otherwise get lost! They enable you to automate payroll, invoicing, expense claims, approval processes, payments, and reports. If your bank allows live feeds, reconciliation becomes a breeze.

Knowing which of these is best for you will depend on your needs, but they both have time-saving features the overworked entrepreneur will appreciate. Bullet, for instance, does automatic mileage calculations and can post Revenue returns directly to ROS. Xero is powerful for growing startups because of the hundreds of other systems it can connect to – stock control, POS, project management, booking, time tracking, CRM, and other business tools. These are cloud accounting solutions, which means everything is safely backed up and encrypted in the cloud, allowing you to always have access to what you need, when you need it.

5. Automation for customer relationship management

Customer relationship management (CRM) software is the go-to for businesses that have a lot of customers to manage and want to design an effective sales pipeline personalised to each individual. With CRM tools you can automate many different aspects of your company’s communication with your customers, such as the initial “Welcome” email, follow up emails, automatic reminders that a subscription is coming to an end and automatic updates to customer profiles and calendars. With customer-centric automation such as this, you can nurture long-lasting customer relationships, boost your brand reputation and capture more leads.

Automation results in higher productivity, reduced operating costs, streamlined processes and the protection of your competitive edge. What’s not to like? Beep-bop-boop, cyborgs are go!

About the author

scarlet-merrill

Scarlet Merrill

Scarlet Merrill is Editor of the New Frontiers website and founder of her own startup, Engage Content Marketing. She is an expert in designing and executing content strategies and passionate about helping businesses to develop a quality online presence… [Read Scarlet’s profile]

Other articles from the New Frontiers blog

Winners of Ireland’s Best Young Entrepreneur Awards (IBYE) announced

Immersive VR Education builds on startup success with a strong team

Startup events to help you end 2019 on an entrepreneurial high

A new cohort commences Phase 2 at GMIT’s Innovation Hubs

product-market fit and finding your sweet spot - New Frontiers

Emer O’Donnell chats about product-market fit and finding your sweet spot

product-market fit and finding your sweet spot - New Frontiers

If you are unsure about what product-market fit is, ask yourself are customers banging down the door? Instead of manufacturing demand for a product or service and relying on the hard sell, product-market fit is when you have found a sweet spot in the market and customers’ needs mirror the unique value you offer.

A Qualified Executive Coach and regular Enterprise Ireland and New Frontiers trainer, Emer O’Donnell has spent 15 years helping companies to locate their sweet spot and grow. I sat down with her to find out more about this business strategy which turns build it and they will come on its head and puts customer needs in the driving seat.

Emer O’Donnell chats about product-market fit and finding your sweet spot - New Frontiers

 

Let’s start off with the obvious question, how do you define the product-market fit strategy?

One of the participants at the Founder’s Forum summed it up beautifully, way better than I could – customers are banging down the door for your stuff. Two authors have written a lot about this, Brant Cooper and Patrick Vlaskovits. Their definition of product-market fit is as follows:

Product-market fit, the match between product and market segment that results in high growth or high demand. So many customers are demanding your product that a clear market signal has been sent saying your product is needed.

Brant Cooper & Patrick Vlaskovits

Is there any way to measure it?

There are a couple of people who’ve written extensively about product-market fit in the last five to 10 years, and they’ve come up with mathematical ways of measuring it. I think those are really helpful for start-ups to look at because it takes you a little bit away from the kind of “art” or “voodoo” of am I there or am I not? and instead provides something factual for you to measure.

So, the first one of those is from Sean Ellis. Sean was the original growth hacker or marketeer behind the initial viral growth of Dropbox. Sean’s suggestion for measuring product-market fit is to ask your customers a very simple question, and that question is “How would you feel if you could no longer use or buy my product?” You give customers optional answers such as wouldn’t care, would care a bit, would be disappointed and would be very disappointed. You obviously need a reasonably sized sample to do this, but Sean’s view is that if more than 40% of the people say that they would be very disappointed if they could no longer use your product, then you probably have product-market fit!

As a trainer with the New Frontiers programme, you have a lot of hands-on experience with start-ups. What are the warning signs that they don’t have product-market fit?

If I look at the start-ups that we interact with, one of the indicators to me that a company may be at product-market fit would be when I hear them talk about the challenges in their business and they’re not talking about sales. When I hear start-ups talking about things like “My sales cycles are taking too long”, or “I’m struggling to find customers”, or “I’m missing my sales target”, that’s an indicator to me that they don’t have product-market fit.

I think one of the big mistakes that we see with start-ups that don’t have product-market fit is that they start spending money in places that they shouldn’t be spending it. There is this concept of a growth pyramid which says that at the bottom of the pyramid you should have product-market fit. You need this as a solid foundation first, and then you build everything else on top of it.

One of the most common mistakes I see start-ups making is that they hire a sales team before they have product-market fit, and then they wonder why the sales team doesn’t work out. If you’re not at product-market fit, then you either need to refocus the target audience or you need to tweak the product. But either way you need to keep your cash burn low.

To recap, product-market fit is when the market is sending out a clear signal that there is a need for whatever product or service you’re offering. Often the challenge when a company hits that point will be related to delivery, and not to sales.

Let’s say you are a start-up that does have product-market fit. What would be your advice then?

OK, on the flip side of that is say one of the companies that I am working with right now on the Founder’s Forum. They have product-market fit, and they are hesitating over expanding the team and raising money. Now they are at risk of a competitor coming in and taking the market from them. It is a balancing act. If you go too far, you run the risk that you are not building on a solid foundation; but if you go too slowly, you can miss the boat. It’s about balancing the two.

What are your key steps for achieving product-market fit?

There are three elements. The first is that they have a well-defined sweet spot or target market. They need to be very clear about who they are targeting. This can be a real challenge for a young company, because often they go too broad and go for, say, “Everyone in North America”! You need to focus down and get really clear about it.

The second one is what is the customer trying to do? What is the problem they are trying to solve or the job they are trying to get done? And knowing how you deliver in value against that and being really solid about that.

The last one is understanding why customers should choose you over the competition. You need to be clear about how you’re different from the competition. The three of these things working together is the recipe for product-market fit. If any one of them is out of whack, you are unlikely to hit product-market fit.

It’s important to remember that the answers don’t lie in your team, but in your customers. You need to be good at getting out and listening to your customers in a very open way, without assumptions. Most people will go out and look for the answers they want to hear. Instead of asking “That’s a good idea, isn’t it?” you should have a much more open set of questions to explore and get new insights. I did an exercise over the summer when I talked to 10 of our own customers, and I got some really good insights. I learned things about how our customers view us that I would never have guessed. But it’s all in the way you ask the questions.

If you’d like more insights from Emer, sign up for the monthly email sent out by her company, Select Strategies, examining the issues which affect growth in many companies.

About the author

scarlet-merrill

Scarlet Merrill

Scarlet Merrill is Editor of the New Frontiers website and founder of her own startup, Engage Content Marketing. She is an expert in designing and executing content strategies and passionate about helping businesses to develop a quality online presence… [Read Scarlet’s profile]

Other articles from the New Frontiers blog

Winners of Ireland’s Best Young Entrepreneur Awards (IBYE) announced

Immersive VR Education builds on startup success with a strong team

Startup events to help you end 2019 on an entrepreneurial high

A new cohort commences Phase 2 at GMIT’s Innovation Hubs

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