Lessons Learned from a Top Global Fintech Accelerator (Part 1)
In the aftermath of the Barclays Accelerator, powered by Techstars experience, one of the most innovative and influential startup accelerators in the world, I’d like to give back to the community lessons learned, including the need for confidence, soft-skills, and efficiency.
Overall, the people I met during the three months spent in Cape Town added so much value to the experience that I really felt I learned something I did not know of before. The propensity to take risks was never lacking in my personal and professional life. However, taking risks and calculating their consequences is something I feel more familiar with today.
The first misconception I had about starting a business was about luck.
It is easy to believe how successful companies or projects have something to do with fortunate events or situations, that people usually refer to as being in the right place at the right time. Today, I have a much different opinion.
I believe that successful projects are the result of hard work and methodically performed strategies, where events don’t just happen by chance, and people don’t just show up in each other’s life.
Everything is measured in successful projects, from how feasible an idea is, to performance indicators and objectives.
In addition, people meet each other through common interest and challenges and facilitate some events, that indeed must be cultivated, and caused in quite deterministic fashion. Generally speaking, nothing happens by chance. Or well, only very few things do.
Startups, one thing at a time
In the nothing-happens-by-chance culture, everything must have a reason to exist. I learned how by asking Why? to everything that has been planned or decided. This healthy questioning helps keep focus on only the essential.
In a startup, as in life after all, one should stay focused on what truly matters, being it a project, a house, or another individual. Whatever it is, keeping it to the minimum usually helps in giving the attention it deserves.
By transferring such a culture to the startup life, companies that focus on the essential, are not only more efficient, and effective with their products or services, but also easier on their budgets, optimal in their strategies and capable of delivering with smaller teams. Such companies are also capable of growing exponentially, whenever they meet the market conditions they placed their assumptions on. The aforementioned exponential growth is only possible by starting small and by validating as many assumptions as possible before moving to the more aggressive and expansive phase of the organisation’s life.
I found that one of the most common mistakes of startups and impulsive entrepreneurs is about opening too many doors, contemplating too many options which immediately translates into implementing multiple services at the same time. In the general case of small overlap among each of those services, it is easy to create inefficiencies and increasing product fragmentation. This, in turn, might lead to burning more resources than it is actually required for the core business.
One lesson to consider is that valuable opportunities might be hidden behind strategies that require little effort, minimal resources, and a lot of focus.
Consolidate. Then grow.
Another common mistake is about growth. A lot of startups want to grow. And they want it badly. There is nothing wrong in desiring to grow and expand in terms of revenue, number of employees and value of assets.
Many organisations however forget about the second side of the same coin, namely consolidation.
Growing without consolidating first is one of the most dangerous events a startup can face. If the assumptions that are supporting growth are not holding at some point in time, a crash will most likely occur.
And the higher you fly, the harder you fall.
In the fast-paced world of startups and extreme programming, spending time validating assumptions can easily be misunderstood as synonym of waste. Actions that don’t seem to move the needle within the current week are usually banned or postponed.
Instead, more energy and time are allocated towards tasks that produce anything tangible, be it a new feature or a new code repository. As a matter of fact, growing indefinitely can be bad for an organisation especially in their infancy. Consolidation is about being honest and brutal with one’s own ideas and visions.
Services or products that did not find a validation, or do not generate the traction estimated by initial assumptions should raise a discussion within the team to understand and outline the reasons of such a failure. Then, they should be shutdown. Mercilessly. Code is expensive not only to design and write, but also to maintain. Sometimes, maintenance is the most expensive of all. A higher number of services or products that have not been validated can create inefficiencies, and might keep demanding resources that could otherwise be allocated to services that would better fit the market.
Cultivate the culture of fireflies
Organisations that are heterogeneous have more chances to cover diverse aspects of the same complex problem. As a matter of fact, team members with different backgrounds, culture and skills — the fireflies — can facilitate the development of ideas and produce more creative and novel solutions that a group of people with exactly the same knowledge might find harder to achieve. Heterogeneity however can be difficult to manage and can play against the team’s objectives, whenever it is not handled properly.
In the next post I will explain how to deal with some limitations of heterogeneous teams and enjoy the benefits of fireflies in the organisation.
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