Over the years, I have accumulated a multitude of knowledge across various facets of running your business through experience, readings and discussions with peers.

I usually keep making notes on any interesting ideas or insights along with my learnings in a journal. This note is a work in progress and I will keep updating it every week, adding more insights over time.

Identifying Ideas

• Identify the mega trend you can ride on
• When launching a new product that aims to solve a problem, try to solve it with the least amount of customer behavioural change.
  • As a new firm, focus on reducing barriers to ensure faster adoption.
  • For big firms with a loyal customer base, it may be necessary to force some changes in customer behaviour, as this can lead to increased loyalty and adoption. For example, Apple’s removal of the headphone jack in iPhone and USB-C port for Laptops

Refer to my blog post on validating new business idea to understand more on the process

Understanding Competition

• Competition is for losers
  • Steer away if too many people are excited about any idea
  • Start in small markets and aim to monopolise at the earliest
  • Focus on the durability of your business over growth. Ensure that you are there even 30 years later
• Don’t focus too much on competition as it risks developing your new products or services inspired by competition rather than customer needs
• Don’t focus too much on competition; it only leads to comparison. Instead, focus on customer delight, which yields better returns than trying to copy the leader. Copying is not as easy as it seems.
  • Copying a market leader to achieve lower costs or higher performance rarely yields successful results
• Focus on the end consumer and how you can improve their life. Focus on the problem statement and not on what your competitor is doing

Productivity

• Efficiency is minimising the effort for a given impact. Leveraging is maximising impact for a given effort. Focus more on leverage than efficiency
• Doing the right thing is better than doing things right. Identify the metrics that you feel are important and scale accordingly
• Always do things that don’t scale to learn and then look at how you can scale them

Business Insights

• The real direct measure of innovation is change in Human behaviour. Innovation is a sum of change across the whole system and not a thing that causes a change in how people behave

• Typically men are more likely to prefer market-driven solutions to government interventions, more sceptical on environmental protection and less keen on resource redistribution

Time Management

• Don’t focus on managing time but identify on how productive you can be for any task. Take up on those tasks that you can manage and best the most productive. Focus on your workload and negotiate or outsource as far as possible
• There is no right system or approach. Keep trying new methods, focus on goals and take feedback
• Understand your working style and adjust accordingly. Pushback on changes that need you to change and accommodate the least possible changes

Product Market Fit

• It’s never the first, but always the first to achieve product-market fit who enjoy market leadership
• In a great market i.e. a market with lots of potential, the market pulls the product out the startup. The only thing that matters is getting to product-market fit i.e. being a good market that satisfies the market
• The market leader enjoys several advantages, such as:
  • Higher margins
  • Defining the customer experience
  • Easily partnering with others in the value chain
  • Attracting better employees
  • Accessing funds at a lower cost
• Once you have achieved a proper product-market fit, it can be difficult to displace, even if the product is expensive or not as good as the competition. All you need is a product that is good enough to maintain a leadership position.
• For second-place players, once a product-market fit has been established, you should redefine the market and focus on areas that the leader is not.

If you are not first to product market fit, then you are last

• In network markets, you can only attempt to generate revenue from alternative sources when your core product is cashflow positive. Your alternative sources are dependent on your core market, so if you’re losing money in the core market, it will be difficult to achieve overall profitability.

You can refer to note on product market fit for insights from other founders

You can refer to my blog post on Validating Business Ideas for more in-depth understanding related to the process

Market Leadership

• There are 3 means to achieve market leadership

  • Product Leadership
  • Cost Leadership
  • Customer Intimacy Leadership

• Focus only on one area that multiple areas

• In the long run, this is how the market share gets divided

  • Market Leader - 40% Share
  • No 2 Player - 20% Share
  • No 3 Player - 10% Share
  • Rest of the Market - 30% Market

• However, in the case of network-type markets, leaders can even end up with a 90% share else most such markets are duopolies as is the case in most tech-driven marketplaces across the world

  Top Reasons for Startup Failure

  • Be confident in the size of the market. Validate the market size thoroughly and make sure the product is a good fit. Avoid being a big fish in a small pond.

  • Understand whether your startup is on the path to success or failure early on. However, don’t rush to a conclusion. On average, B2C startups take four years before failure, while B2B startups take three.

  • Don’t fall in love with the solution; focus on the problem at hand.

    • Build code or automate only when you have 10 paying customers.
    • Keep asking yourself:
      • why am I doing this?
      • Who am I building this for?
      • Would you pay for such a solution? How much?

  • Most potential customers lie: Just because they say it’s good doesn’t mean they are willing to pay for it, as most rarely take any action to solve the problem. If the customers you are talking to are not working towards finding possible solutions, then they are unlikely to pay. Focus on customer behaviour, not opinion.

  • Marketing is necessary for sales growth. Focus on understanding sales distribution channels and how people can access your products. Pay close attention to Customer Acquisition Cost (CAC) and try to avoid breaking even on marketing costs based on Customer Lifetime Value (LTV), but instead aim for customer profitability from the first transaction.

  • Follow these guidelines:

    • Establish a clear budget and set deadlines.
    • Never exceed your budget.
    • Don’t hire until you have a product and paying customers.
    • Always plan for the worst-case scenario and build your business plan accordingly. Remember that companies don’t fail due to their inability to scale, but due to scaling faster than market demand.

  • Don’t get stuck on sunk costs and sentimentality to close. Just analyze: if you were starting from scratch, is this a good way or time to course-correct?

  • Have multiple options and don’t limit yourself to just a few.

  • Remember it is easier to fool people than to convince them that you have been fooled.

  Improve Decision Making

  We can improve our decision-making, drawing lessons from our past decisions by following these steps:

  • Identify a past decision that was similar to the current one in terms of risk and uncertainty.
  • Analyse the variables that influenced your decision, such as your goals, values, emotions, assumptions, and information sources.
  • Evaluate the outcomes of your decision, both positive and negative, and how they affected your life and well-being.
  • Compare your expectations with reality and identify any gaps or surprises that occurred along the way.
  • Extract lessons learned from your experience and apply them to your current situation
  • Develop a simple mental model that allows you to

  Regularly doing this exercise can reduce anxiety and increase confidence when making bold decisions. Seeking feedback from others who have relevant expertise or have made similar decisions is also advised. Finally, it is important to remember that bold decisions often lead to personal growth and fulfilment, even if they don’t turn out as planned.

You can refer to my posts on decision-making to read more on this