Startup Design

Staging for Startup Success

Staging for Startup Success

“Success is a process.”

― Alex Noble

“If you put good people in bad systems (processes) you get bad results.”

― Steven Covey

Most start-ups fail because they don’t get to product-market fit.

Start-ups (and other early-stage ventures) that go through a gating process, whereby they invest more only after scaling through certain hurdles, become more market oriented and are generally more successful.

The key gates we often look at are;

  • Idea stage. Entrepreneurs need to test the concept with live members of the target market. The more realistic the testing the better, up to getting customers to pay a deposit. Only after passing a concept test would, you go on to invest in developing a prototype or MVP.

  • Prototype/MVP stage. The simple gate is to sell it, getting your first customer. Then invest in low volume production and a salesperson.
  • First few customers. Depending on the type of product this could be a couple or up to ten. After getting through this gate, it makes sense to invest in replicable acquisition, production and fulfilment assets, processes, and people. At this point you will be able to create a credible business plan.
  • Stable metrics. Invest to dominate your niche, enter new ones, and position the business for high growth
  • Growth metrics (+10% per month). Invest to scale the business rapidly.

This way you increase your burn rate only as you demonstrate market traction.

This is a summary of Afam’s key note speech in November 2016 at the High Growth Africa Investment Summit.

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