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Building a Startup is not an easy feat. StartHub has worked with hundreds of student entrepreneurs in East Africa. We will guide you through it. Step-by-step. For free. Link the best content to learn what is necessary. All for FREE. Because we love you succeed. This is an overview of the Journey of a Startup.The articles we publish are of the same format: A video explaining you what you need to know. And further content for you to deep-dive into the respective topics. The next articles will explain the exact steps to start off, one-by-one. Starting a startup is not about talking. It is about solving your customer’s problem. These articles help you to put something on the ground. If you need further guidance, apply for the StartHub Catalyzer program on the Website. The Catalyzer helps startups to (i) execute a step-by-step plan, (ii) learn what startups have to learn and (iii) get access to investment.
You must have an idea of what next.
No direction is like running blindly.
You need a gameplan.
As a startup, you only have a limited amount of resources. You build a product and spend time and money. It is thus most important to focus on what is really important and not to run in the wrong direction. Not knowing what to work on is the biggest reason for failure we have observed. We give you this game plan to follow a structured step-by-step process in the right direction.
Each following article will give you detailed insights into the steps to take. Milestones to achieve before next steps. Today, you get the gameplan. The overview.
Here an explanation of a four-step startup journey, starting from the end goal: Scaling up a product and business model you have proven to work. Then, we learn how to build that product and business model. Then what it takes to grow our user base while building it. And finally, we reach the first step: Starting off with the first product version and getting the first customer.
4. Scale up the company.
Finally, this guide is about how to build a startup that will grow continuously and as fast as can be. So what is needed for this?
- Growth Hypothesis confirmed.
- Team to execute growth.
- Sufficient Capital.
All of these are important. But the most important thing here: Do not even worry about all these before you have Product Market Fit. You do not need Growth Capital now. You do not need a huge team now. You do not need to worry much about the three ways of sustainable growth. Many startups fail because they try to scale before they are ready. It will drain your resources. Stretch you thin. We will get there. For now, eyes on the grail: Achieving Product/Market Fit.
A Startup has to defeat uncertainty before scaling up.
A Startup needs Product/Market Fit first.
3. Achieving Product/Market Fit.
P/M Fit is what happens after you have built a product that customers REALLY love. You know that you have built something people love if you have heavy usage of your product. When your customers cannot live without it anymore. When they need more of it. This puts your product at the center of your African startup. If you have an amazing product, growth will be possible. If you do not yet have that product, any marketing money will not earn you good returns and people will stop using it. Building that amazing product means you know what your customers want. What problem you are solving for them. And how to solve it. Three things that will show your African startup you are on the right path.
- Great retention. If people do not stick, there is no growth.
- Great overall product (including monetization).
- A market to grow in – that pulls your product.
It is called Product-Market Fit if you achieve this. And you are worried you have too much demand and growth. It is very hard. Many think they have it but do not. It is characterized as having achieved a product that is so great, there is no other thing that happens to you than grow. Like magic. Even if you keep pushing for growth. You just try to keep your company running. You will feel when this is the case. If you are asking if you are there, you are not.
Traction is the ONE thing that will make investors happy about your Startup.
2. Achieve Early Traction.
What “counts” for your Startup? Customers. Who love what you offer! And your African startup has to improve what you build for them based on their feedback. So, let’s make people happy. If they love you, that means you are getting towards building the right thing. It means, that they will tell their friends (there is no better marketing, and it is free!). A few milestones:
- Build a product that 100 customers LOVE SOOO MUCH.
- Hack retention: Build a product people come back to all the time (like you to Facebook…)
- Learn marketing and sales for your product.
To reach P/M Fit, you have to build that amazing product. At this point, your African Startup will still do many things manually. And automatize step by step. Start here: Make 10 customers LOVE your product. And then 100. If you never reach this number, your African startup will never be huge. Just do it. Retention means to “make customers to keep buying from you”. If they buy your product again, it means that it is valuable for them. Retention is the most important thing if you want to grow. Because if customers do not come back, marketing your product and getting more customers will only mean that they will also stop using the product. If your first 100 customers love it, chances are good that future customers will stay as well.
A Startup's job are actually just two things: Firstly to keep building and improving the product. Secondly, to talk to customers - get feedback & do sales.
1. Problem/Solution Fit.
Before a startup can think of having 10 or 100 customers who LOVE their product – a startup must find their very first customer. Who pays because she or he gets value from the startup. If a startup has no customers and thinks of anything else than what minimal version (the famous MVP – more on that later) of their idea they can offer to get the first customer – the startup is focussing on the wrong thing 99% of the time. A founder’s job is to get outside the building and talk to customers. Problem interviews, customer discovery & sales – that is a startup’s job at the start. Because if you do not solve an extremely urgent problem people have, you will not be able to build a big startup in Africa – or anywhere. And talking to customers all the time is the only way to deeply understand their challenges. And build what they need to solve them.
To get your first customer, you need three ingredients. A great idea, a minimal thing to offer value to that one customer, and launching (=selling/making it available) that thing.our Value Proposition.
You have reached Problem/Solution Fit once you a certain amount of people shows a strong interest in your solution to their problem. Do not conceive yourself that you have really understood the problem and solution in detail after speaking to five people. It really is a journey. And you have to go through it. So how to go about it? To reach Problem/Solution Fit, StartHub Africa guides African Startups through 4 steps with 4 milestones. It is not easy. You have to work hard. But it is the only way. These are the four steps. The next four articles will look at them in all depth, one by one.
- Document your “Plan A” – Business Model Hypothesis & Growth Strategy.
- Do Customer Discovery – Learn all you can about your customers and their challenges.
- Launch an Offer (Demo + Price + Value Proposition) – to get feedback.
- Plan and build your Minimum Viable Product (MVP) – to test your Value Proposition.
Does this sound difficult? No worries. It is easier than you think. Once you know what to focus on. StartHub Africa takes African entrepreneurs by the hand and helps YOU to walk the startup journey.
Now, there are only three things left: Register for StartHub School and get notifications and more know-how from StartHub Africa. Secondly, help us get better and fill in our very short feedback form (takes only a minute!). Lastly… Below the feedback form StartHub presents four great pieces of knowledge about what good startup ideas are & what to do before you start your startup.
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… Before starting & about Startup ideas.
If your startup works… You will be working on it for years. So you should consider a range of things to see if you are ready and up to it. Do you have the skills you need? Do you have a team that can actually build the product? Do you really want to spend a lot of time on that topic? And much more. Though, in the end it is a feeling. It is often something you do because there is NO WAY you do not start this startup. It just feels good to YOU.
At StartHub Africa and for the Catalyzer, there is three things we consider selecting teams in our application process:
- Can the team build the actual product? If you will need a web platform – you need to be able to build it with your team.
- Does the team have a “bias towards action”? Is a team brainstorming and planning or actually building and launching things, selling, in short: GETTING SHIT DONE?
- Is the team excited and commited? There will be hard times. It is necessary.
Check the insightful videos to learn more – and read Paul Graham’s great post on Startup ideas linked here below.