The importance of implementing the right strategy for startups
The startup-culture has been thriving over the past few years, but more so in 2020, with a lot of people starting to give importance to passive income or losing their full-time jobs and venturing into businesses of their own. Even before the COVID-19 pandemic, the UAE was beginning to encourage startups with incubator programs and somewhat-flexible business registration policies. It is reported that startups in the UAE have raised more than AED 65 million in direct investment during the first six months of 2020. However, sustaining these businesses through economic ups and downs is another ballgame altogether.
In order to cultivate a new business into a successful one with high profitability rates, it is vital that it operates with the most suitable and financially viable strategy for startups. A startup like Souq.com evolved into the highest valued internet company in 2016, and in 2017, Amazon confirmed the acquisition of Souq.com for approximately $580 million. On the other hand, many startups are formed by a group of creative individuals with unique ideas and great enthusiasm, but if they do not have the right guidance in terms of the financial and strategic aspects of their business model, these startups are unable to remain in operation for too long.
How can External Consultants help?
The processes that a good External Consultants would follow to support startups can be quite detailed and comprehensive, but in summary, the following are some benefits of working with External Consultants:
- Obtaining tailored expertise in a specific industry – you may have the most unique idea, but you might not have the necessary knowledge in this domain.
- Conducting thorough market research – this is a crucial step prior to devising the right strategy for startups, in order to make sure you are catering to the right problem in the right way.
- Analyzing the strengths and weakness of the business – performing a thorough internal analysis requires a highly objective viewpoint, which can be difficult to achieve from an insider’s point of view.
- Gaining objective feedback into your policies and processes – domain experts can advise you on how to align your processes and policies to meet best practices that are established to reduce costs and improve productivity.
- Training employees on new procedures or existing strategic concepts – a good External Consultant will not only identify the right tools and procedures, but also train your employees to use them in an optimal manner.
- Influencing internal and external stakeholders – this can be particularly useful when pitching your startup concept to venture capitalists and investment firms.
Nowadays, it is not uncommon to work with External Consultants to formulate the most effective strategy for startups. When you are engrossed by the idea of your startup, it can be hard to separate your vision for your business from its fiscal reality – this is where External Consultants come in. Even though External Consultants are an expense in the technical sense, the value that they provide can far exceed their cost by helping your startup make the right choices and boost profits, while addressing any obstacles, and identifying further opportunities to ensure sustainable operations in the future.
The sum of expensive mistakes due to a lack of proper guidance could be much larger than the hiring costs of External Consultants, so in the long run, it would make more sense to invest in the right expertise in developing an effective strategy for startups.