Businesses are all about making money, right? If there wasn’t a financial reward for all the hard work business owners commit to, they simply wouldn’t do it.
But the path to profitability for a startup isn’t necessarily simple, nor linear, as serial entrepreneur and founder at IE Agency Rhys Hayes can attest.
Hayes recently spoke to The Pulse about the sorts of mistakes many startup founders make, noting that across all his ventures, such as Foyer Live, he’d committed them all.
“New business owners can easily be distracted from their goal,” said Hayes. “Whether it’s analysis paralysis, a lack of clear business planning or misunderstanding your customer base, putting a single foot wrong can seriously hamper your pursuit of profitability.”
Hayes firmly believes that entrepreneurs should focus on business concepts they’re passionate about, not just the ones they see the largest opportunity in.
“In my experience, people tend to get wealthy from doing the things the things they’re most passionate about,” he said. “People who think, ‘This is an idea that will get me rich,’ who end up taking the shortest route to making money, they’re the ones that tend to burn out quickest.”
Rather than taking shortcuts, new businesses owners should focus on developing an ironclad business model with practical, comprehensive goals that allow the business model to be tested along the way.
“If you’re developing a product-based business, I recommend avoiding offering professional services as a means to generate some quick revenue, for example,” said Hayes.
“Instead, focus on building a sound business model that you continue to test at every step of the way.”
Hayes will be presenting his best practices for plotting the path to profitability at Inspire9 Richmond on 7 March as part of the weekly Masters Series by WeTeachMe for entrepreneurs.
Likewise, Hayes said, he’d seen plenty of cases where founders take on advisers only to become encumbered by conflicting counsel.
“A form of analysis paralysis occurs when startup founders lose confidence in their own vision,” he said. “I call it the Founder’s Dilemma – you need to balance optimism and pragmatism at all times.”
Greg Dziemidowicz and his startup MarineVerse are a novel example of a concept that has grown out of a mixture of passion and pragmatism.
Specialising in virtual reality (VR) sailing simulation, MarineVerse is the direct result of Dziemidowicz’s love for the sport and built off the back of his long history in software development.
“What began as a ‘side hustle’ for me and the foundation team eventually became a full-time commitment in November last year,” said Dziemidowicz. “While it’s still in its early days of getting off the ground, we’re making excellent progress so far.”
Not only does this tech-centric entrepreneur advocate for taking a ‘slowly but surely’ approach to growing a business towards profitability, he’s also garnered valuable experience in choosing the right tools for the task.
“From the very beginning MarineVerse has been a collaboration between talented individuals from all over the world,” he said. “We simply wouldn’t have been able to grow our business in a cost-effective way without tools like Trello and Slack.
“Slack was particularly amazing for working with collaborators in different timezones. It essentially helped us create a virtual office space, which I suppose is fitting for a business developing virtual-reality software.”