The top 3 reasons startups succeed

You've probably heard that only +-30% of startups make it to year 5, with success rates dropping off wildly after the first year. Those who make it past the fifth year and become profitable businesses (not-so-start-up-anymore) aren't smarter than the others. Their ideas weren't even necessarily better.

Having worked with startups and changeups for more than ten years, and watching the industry closely, I've noticed some themes that generally predict whether they have a fighting chance of being in that 30%.

In the hope that this helps some avid entrepreneurs and startups trying to leave their mark on the world, here are three things that their success has in common:

• They take time to know and understand their audience

• They're driven by a why and unattached to the what

• They're problem, not solution-focused

Sound easy enough? Let's unpack these a little.

They take time to know and understand their audience

They do this before spending money or time on their brand, product or offering (even their MVP). They research their target market to understand their habits, aspirations, needs, pains and wants, so that everything from their communication, to journeys, colours and even the details of each feature has empathy and relevance.

They validate their assumptions and ideas, and seek to understand if their ideas have value to their audience. This kind of validation is what we often call product-market fit.

Through their time and efforts, they sometimes realise that their intended target audience won't be their most successful one, that how they were thinking about their idea needs to change, or that what they believed to be their most important experiences or features were in fact just nice-to-haves for their target market.

The insights are marvelous. And they all happen before an MVP or prototype is pregnant in the business belly.

Empowered with this understanding, these businesses become the answer to their customers' prayers and the meeter of their needs, never shoving a feature, fact, or advert down their throats. Always there to serve.

More than this, they don't stop there. They ask their customers for feedback, constantly consider how business decisions will impact them and keep learning how to keep their audience happy.

They roll with the changes and the dough rolls in.

They're problem, not solution-focused

This might sound like two sides of the same coin, but it's actually very different coins. And the one is more likely to move you into the 30%. Let me try clarify.

If you've ever been in a room where someone's said "how cool would it be if we offered bla" or "let's focus on creating bla", "great. It's decided", you've been involved in solution-focused thinking. If you've ever had an idea for an app and immediately started thinking of all the features it should have, you've also fallen victim to solutioning.

You're embarking on creating an offering, product, or experience without context and with a lot of "this is a good idea because I came up with it and I don't want it unpacked or scrutinised, so we're going with it" attitude.

What are you not doing? You're not thinking of the problem you need to solve.

Problem-focused thinking totally ignores the cool, fluffy thing, how we think it should work, or whether the highest paid person in the room came up with it, and keeps asking "what problem are we solving?" and then when we're ideating how the solution or feature might work "does this solve the problem?"

If we keep going back to the problem we're trying to solve, and need or want our customers want met, the solutions that come about are not only elegant, simple and relevant, but because there wasn't an ounce of ego (my idea/I'm right thinking) in our ideating process, we're open to pivoting when the problem changes.

We aren't attached to the solution, we're constantly curious about the problem.

They're driven by a why and unattached to the what

This theme has a little bit of the first two simmering inside it, and then some.

The then some is important, because unlike the other two, it's self-focused, not audience-focused. It asks the humans behind the businesses to look inward. It asks them to take a step back and remember what's important to them and what mark they'd like to leave on the world. It asks them why they do what they do.

Some know this innately, even if they struggle to put it into words. Some have forgotten it, and some don't know it at all. The point is that the members of the 30% are willing and committed to find out, to put it into clear words, and to never let these words out of their vocabulary.

Their why becomes their north star - guiding everything they do in the business; every action, process, policy, offering and recruitment decision.

Let's say, for example, my business is a lemonade stand, and my why is that I want to brighten people's days. I might start by asking myself how my stand can brighten people's days? And I'd keep checking that I'm doing just that. I'd only hire bright, friendly people. I'd make sure my drinks were refreshing and delicious. I'd print cards that have a cute message on them and give them to each of my customers. I'd ensure my brand colours were on the list of colours that make people happy and give energy.

It also means that if my stand was outside a corporate park and I could see several people staring at my happy looking lemonade as a stark reminder of the indoor prison that is their days (overdramatic, I know), I'd want to do something about it. Do I move my stand? Do I speak to the managers of the corporate park about offering discounted lemonade to every employee in the afternoon slump hours?

I do something.

Because what I do is always guided by why I do it. And this why is present in every decision I make. Whether it's a new offering I'm toying with, a merger I'm considering, a difficult but profitable customer I'm anxious about bringing on, or a total change in business direction, I go back to my why and ask myself if this *blank* is a way to achieve it. If the answer is yes, it's a no-brainer.

This is particularly important in a world where things change faster than we can get used to them. It helps cut the noise and the allure of shiny things and countless distractions and stay focused, true and human.

And so?

Know your why. Live by it. And be willing change what you do as often as your audience is silently asking for it.

This, combined with staying focused on solving their problems, and not getting lost in glitzy solutions might mean you'll be welcomed to the 30%.