Most budding businesses take between two and three years to start realising profits and over five years to become truly successful. However, only 75% startups survive the first year and only half of those are able to hit the five year mark. Trying to find the secret recipe that guarantees success while also ensuring continued survival and growth is no simple feat.
Age-X has been in the game since December 2016, bringing our age to just close to four years. This makes us experts on the topic because we say so and we are going to tell you all about how to survive and grow in the harsh African environment.
Finding your identity
Most starting entrepreneurs are in it for the fast money. People pick up on a fad and make the mistake of trying to start an entire business around it. This is a surefire way to fail gracefully. You must be able to distinguish between a fully fledged business idea that can grow and scale while also enticing investors versus a quick cash cow that you can milk then it dies without leaving you any calves.
When Age-X started out, we were more interested in making games to try and tap in on the Flappy Bird and Angry Birds craze. As a small startup with very limited resources, this turned out to be a very tough hill to climb. Eventually, we switched to apps and created The Highway Code Zimbabwe App.
Baby Steps – The First Year
You’ve come up with a million dollar idea, created a social media profiles and launched a website. You have also managed to convince your grandmother to buy six of your disruptive cool products which she doesn’t even understand how to use. The great thing is you have made your baby steps as an entrepreneur, recorded sales and created a presence on social media. This is reason to celebrate as very few people ever go past the ideation stage to create a product and gain customers.
In your first year, if you also manage to start paying your own personal bills with your profits then you should really celebrate as 20% of all startups never make it past the first year. During our first few months, we created three mobile apps; The Highway Code Zimbabwe, an Avon shopping App and The Animated Highway Code. Only one of those three apps became a hit with people. The Avon app flopped and The Animated Highway Code didn’t become a hit and we realised this very early on.
This is a very important skill to have as a startup entrepreneur. You need to be able to redirect your very limited resources to products with potential and not sink them in products that will flop (cough cough Econet Zimbabwe). Some people call this Fail Fast and move on
Staying on the Horse – The Second Year
As the first year ends, you need to acquire more long term customers as grandmother wont be able to keep buying more of your fidget spinners. Year two is when you must focus on growing sales and expanding your customer base. During the year, aim to make small milestone growths.
In your second year, you need to learn and understand that starting a small business and growing a business are two separate beasts. Each step needs differing strategies and management style. In our second year, we launched four more apps (Zimsec Accounts, Physics, Mathematics; GCSE Mathematics and The Highway Code Zambia). None of these apps are among our top 5 performing apps. We were still trying to find our identity in a very competitive Google Play Store with very little advertising funds to push our apps.
Year three – Making some money
In the third year, you need to break even. You are now at that stage where you know your market, have a killer product that people are dying to have. In year three, you do not necessarily need to be making major revenue, but your business needs to be taking care of its own expenses. You should also be making enough money to be able pump some of it back into a growth and expansion strategy.
The third year for Age-X was when we launched what were to become our top performing and highest rated apps. We had enough money coming in to also be able to get content creators to generate high quality and unique content. By the third year we knew which areas of our business were worth growing and how to grow them in a steady way that didn’t shock the market.
Year Four – Be the King of your Game
If you’ve made it to year four, you should now be a King of your game. Whatever new product you throw out should be a guaranteed success because you now fully know your market and know how to give them exactly what they want.
You also now have a solid customer base and your new products can piggy-back on the earlier successful products. Also be careful not to relax. Just because your top product is dominating the market, do not stop innovating, improving and updating. As you do this, also be extra careful not to over-engineer and end up breaking a perfect product by trying to add in too many bells and whistles.
Age-X has an annual update schedule. Each year, we update all of our apps with new features and designs. Our older customers feel like they are getting a new product and new users will get a product that aligns with current trends.
Some critical steps
There is no secret formula to a successful business. Some entrepreneurs experiment for several years before something clicks and others have instant hits. Note we mean instant hits, not overnight successes. There is no such thing as an overnight success.
These are some of the steps you need to take as a startup:
- Have a business plan. You need to have a solid business plan with a scalable business idea.
- Do not try to pump in too much capital too fast.
- The business’ money is not your money. Keep them separate.
- Be patient. Do not try to rush success.
Follow these simple steps, and in a few years, you will own your market and have a top product that serves hundreds of thousands around the globe.