How Startups Can Increase the Odds of Long-Term Sustainability

During the past decade, the world has witnessed growth of global startups facing serious threats from lack of longevity plans. Many startups that mushroomed during the mid-2000s disappeared overnight due to the lack of a “long-range vision.” Although these upstarts dared to disrupt and demolish the old order of business, they completely ignored the traditional values of preservation and sustainability.

Longevity should always be the primary concern of a burgeoning business, without which success will just be a passing fad. In the startup world, very few business ventures survive beyond incubation or early-stage development. How can the startup culture that rarely allows businesses to survive beyond the early stages of growth and development buck the trend?

Startups That Survive the Early-Stage Development

Startups that prevail beyond the early-stage growth generally recognize that profit is necessary for sustainability, but they:

  • Design products and services based on daily challenges faced by ordinary consumers. For example, a healthcare app, a business tracking tool, a financial advisory service, a 24/7 task reminder app, and so on.
  • Focus on long-term, value creation without losing sight of profit margins. The extended services that each startup usually offers are designed to retain customers for the long haul and generate new business through customer-feedback marketing.
  • Experiment with and continuously reshape business models with a mission to serve the customers and not just sell. Countless startup businesses like grocery or food-delivery apps go beyond just selling products and services to fulfill the customer needs of online order services, online payment services, and home-delivery services. These are real value-added services that customers have come to expect in an advanced tech-enabled human society.

The Importance of a Strong Leadership

The founders of a startup drive the mission and vision of the company, which is why strong-willed and decisive mindsets will make good leadership candidates for startups. During the early stage of development, it is this core team of leaders that makes the financial and funding decisions, the technology choices, the products and services design decisions, and other strategic decisions for moving forward. Thus, it is imperative for these leaders to have:

  • Innovative mindsets with a natural flair to read the market pulse
  • The best contacts in their sector
  • Insider links to academic talents for product research and development
  • Access to the best capital funding channels 

Lessons to be Learnt From Survivors of the Startup Boom

Startups that succeeded utilized the following attributes:

They devised lasting strategies for adapting to change in technology, regulations, and market needs. An ongoing effort to adapt and implement new technologies, relevant laws, and market policies to fulfill the broader objectives of business through solid partnerships or collaborations with other businesses is a must.

They were less focused on quick wealth creation and more on sustainability. The focus of startups should not be just quick profits but delivering value-added products and services to human society.


Here are the typical traits of successful startup leaders:

  • Innately humble and willing to listen to others
  • Positive mindset and willingness to take ownership of decisions and actions
  • Great salesmen with the right combination of confidence and pose
  • Focused on their goals and are decisive
  • Flexible enough to see challenges ahead and quickly adapt to changes

Good startup leaders have to be visionaries while keeping a focus on day-to-day operations. They never lose track of details – be it business objectives, long-term strategies, product design, service development, or customer engagement. Walt Disney led the masses with his “dream.” He had such an influential and charismatic personality that he transformed his entertainment world into a globally renowned brand and a highly profitable business. He was the pioneer in the edutainment business.

Society Development

In the startup world, it is not enough to just create good products and services for fulfilling particular consumer needs for profits. Startups generally go beyond wealth creation, which the old-world businesses have only recently understood through corporate social responsibility (CSR). Understanding value creation for human society was always a business priority for startups. 

Through their business mission & vision, they generally serve the poor and downtrodden sections of the society, focus on the underserved population, rely on eco-friendly business processes, and believe in humanistic methods of profit generation. They often innovate recycling strategies, cost-effective production methods, and technology-enabled practices to keep their businesses lean and efficient and make a social impact. 

By implementing the aforementioned goals, successful startups increased the odds of long-term sustainability without sacrificing short-term growth objectives.

Three Startups That Survived the COVID-19 Pandemic

Let’s see how these three startups located at three different corners of the world survived the recent pandemic:

Abacus Financial Business Management

Belva Anakwenze, owner of the LA based Abacus Financial Business Management, has taken one month at a time to help her niche financial advisory business survive COVID-19 by:

  • Providing advanced-technology enabled, remote financial advisory services to entertainment world clients
  • Patiently accepting the shrinking profit margins as most of her entertainment industry clients were hit hard during the crisis
  • Conducting client meetings on her driveway after maintaining the social distancing norms
  • Allowing her employees to work remotely through the wee hours of day and night as needed
  • Paying rent on an office space that she has not used for months but still hoping her business will turn around soon
  • Taking a small loan from the federal Paycheck Protection Program 

Big Basket

A pan-India grocery retailer was hit hard in March of 2020 when their supply-chain network suddenly faced a crisis and the majority of their delivery staff could not report to work because local trains and buses were not running. So, what did Big Basket do to turn around their lost business? Here’s something to learn from their redesigned business model:

  1. They adjusted their web and mobile platforms to reduce the long waiting queues for online orders just to give all customers a fair chance. Specific times of the day narrowed down the order windows to adequately mitigate the problem of reduced delivery staff. 
  2. Big Basket started partnering with cab-service aggregators and food-delivery services to deliver groceries in metros and other cities.
  3. Big Basket did not stop delivering groceries, they just increased the grocery-delivery time to keep their business running and customers satisfied.
  4. They introduced a host of other useful services, operational now, to win back their customers’ faith.

Bidroom

Here’s a story of real inspiration. In the pandemic-ridden year, when a series of events like global lockdown and closure of airports brought the international travel industry to its knees, here is one unusual travel startup that braved the recession and refused to back down. This startup not only survived but raised funds and generated revenues.

If you ever get a chance to talk to Amsterdam-based Bidroom’s CEO Michael Ros, you will know that some extraordinary business leaders like Ros reinvented their travel-tourism services business models to survive the year-long crisis.

Michael Ros took the following bold steps to save his travel startup from succumbing to the global recession in the travel industry:

  1. Ross added 49,000 hotels to his membership-based travel-booking platform.
  2. Bidroom also witnessed the addition of 40 business partners to better serve the hotels and travelers.
  3. This startup enabled remote workforce arrangements with an expanded IT team.
  4. They hosted eight online events with industry professionals from all over the globe.
  5. Bidroom introduced many value-added services to offer their clients a truly holistic tourism experience.
  6. When businesses the world over were busy downsizing, this company went ahead and expanded their product offerings and staff capacity. 
  7. In 2021, Bidroom’s top business priority will be traveler safety, which they plan to implement through innovative product and service enhancements like travel insurance.

Finishing Lines

The large-scale failure or disappearance of the startup boom of the mid-2000s has signaled an era of drastic changes in business practices and long-range business planning. The startups of the present decade are much more conservative and cautious in their business plans. For starters, most modern businesses have clearly charted out Exit Plans. Startups have a lot to learn from traditional, resilient businesses like American Express or Microsoft that know how to adapt to change.

How Startups Can Leverage Artificial Intelligence and Machine Learning

Startups today are in an exciting phase. Amazon, Facebook, Google, Netflix, Tesla, and many of the world’s biggest technological household names were small fledgling startups not long ago. 

Even now, every few days, we hear of another startup like Spotify, Airbnb, or something or the other becoming a unicorn, going public, and, before we know it, becoming an integral part of our everyday life. It replaced companies and brands that had been a part of our lives for as long as we can remember. If not all, most of them can do so because of the tremendous advances that we have seen in technology in the past few years. 

AI & ML today offer solutions to many problems that we considered insurmountable in the past. They improve existing solutions in cheaper, quicker, and more efficient ways. While it can be challenging to manage expectations from Artificial Intelligence and Machine Learning efforts even today, the results can be worthwhile if done right.

7 ways to leverage AI and ML

Here are some ways in which startups are uniquely positioned to leverage their flexibility to make AI and ML efforts successful.

1. Access a lot of data

It is the era of Big Data, and you can’t do AI or ML today without data. Depending on your product’s scale, you need to ensure that you have access to enough data on the problems you are trying to solve. By being small, tech-savvy, and operating at scale, startups use technologies to digitize whatever material they can, automate whatever tasks they can, and often capture large amounts of data for training models and building AI products.

Machine Learning projects often run into many cold-start problems, not having data resources and whatnot. Manual effort and one-time solutions can get you out of quick pickles. Still, to eventually come up with a scalable and long-term solution, you will need access to large amounts of data. But on not only what works but also what doesn’t by tracking large datasets over long periods. Because startups that realize this consider data as an asset that they actively try to build.

Results of a recent survey of ML Practitioners on their current data requirements (Source)

2. Find the Right Fit

According to VentureBeat, 87% of AI projects don’t make it into production.

Companies often need time to figure out their product/service concretely, what features they can realistically offer, how it distinguishes themselves in the market, and many things that can only happen through trial and error. Large corporations come under a lot of scrutiny by both the public and investors. 

At the same time, startups generally can spend a lot more time exploring multiple options and finding the right fit for themselves. One of the best examples that come to mind is Slack Technologies. 

Currently one of the world’s most popular chat and productivity tools – used by 77% of the Fortune 100, Slack was initially a gaming company called TinySpeck. After shutting down their MMORPG Game “Glitch” in 2012, they went on to port the game’s “familiar” pet rock into Slackbot, a friendly bot that helps you find things around gives you notifications, and keeps you informed about the workspace. Slack was launched in 2014, got listed on NYSE in 2019, and was acquired by Salesforce for $27.7 billion in cash and stock.

Related reading: What Does AIOps Mean for Startups?

3. Minimal Bureaucracy

Compared to large enterprises, startups are more flexible and dynamic in setting up the business and cultural procedures, ensuring that they set processes right with a long-term vision right from the get-go. People wear many hats at startups, but there is also a lot more active direct communication and understanding between the business teams, product teams, data science teams, and domain experts.

Communication in startups is more comfortable, and analyzing the problem from multiple angles and understanding a lot of different perspectives is simpler. Because of the closer working relationship among team members, it is easier for them to get access to any data point that they may need, and get resources to test out different technologies and operation processes until the right fit for the team(s) has been discovered. This system is also present in more prominent companies, but in startups, the system is cheaper, quicker, and easier to manage.

Related reading: What is Hybrid Intelligence and Why is it the Future of AI

4. Building a Knowledge Base

While large corporations often handle an entire end-to-end solution, startups generally spend a lot more time carving out a niche and pursuing excellence first in that small niche. 

Startups have smaller, more connected teams that are all focused on solving that particular niche problem quickly. Storing information about the difficulties faced, and sharing lessons learned is more straightforward. 

Startups can afford to be flexible, make mistakes, fail fast, and work out solutions to what works or will eventually. This builds a domain-specific knowledge base about the problem that serves a critical role in building AI-based products.

KiwiTech helps resolve AI challenges for startups

By assisting startups to build loyal relationships. Communicating with customers in their familiar environment allows your company to feel that they are heard, supported, and appreciated. Such clients will, in turn, understand the flexibility of the system and its ability to help them to achieve the desired result, whether it is a conversation with a chatbot or a virtual agent who joined in the conversation right in time.

We are constantly improving interactive applications and solutions. We are working on the perfection of their use cases and paradigms, which ultimately will lead to increased productivity for startups and a more personalized and accessible experience for end customers.

At KiwiTech, we have helped several startups get the right AI implementation in place for their business. Speak to one of our AI consultants today.

Why Raising Too Much Money May Not Be Good for Your Startup

The success of any startup largely depends on how much funds have been raised, invested, and judiciously utilized. However, the real question is how much funds should be raised at the start. If you are establishing a startup for the first time, there’s every possibility of being tempted to fundraising in a big way at the seed stage itself. The allure may be strong but can eventually prove deadly for your startup.

The best way to begin your startup is through self-funding or bootstrapping by pooling in your savings, and borrowing from family and friends at cheaper rates. Your startup will get running with little investment initially. Raising seed capital from family, mentors, friends, and seeking loans in exchange for common stock is yet another way to fund your startup during the preliminary stage. Most startups, however, depend on venture capital funding, which may, later on, result in multiple rounds of funding depending on the viability and potential success. Before going in for venture capital fundraising as a startup founder, you should first assess your requirements and ask yourself how much fund is to be raised.

Be realistic with your expectations

When looking to get funding for your startup, you need to make solid financial projections and be realistic with your expectations. Being optimistic and positive about the expected revenue is good, but it should be based on provable facts. You should approach potential investors with well documented financial projections when seeking funds for your startup. You need to present the figures that your business can generate. False projections will put you in difficulty. Being a realistic optimist will work wonders for your startup and give it a solid reason to forecast its success. 

Adopt a conservative approach towards fundraising

Most startups start their journey with unassumingly great investor confidence and high hopes. However, many startups often capitulate within the first year due to several reasons. When it comes to fundraising, you need to tread cautiously, and with a conservative approach. 

Overpromising the investors with what your startup just can’t fulfill is sure to backfire. Presenting a rosy picture to investors just for the sake of fundraising will do you no good. You need to raise funds conservatively and then grow. 

Do remember that achieving or exceeding the objectives of your startup will solely depend on making the right investments and the hard work your team puts in. And, it’s possible only when you know how much funds are needed to make the startup fulfill your and investors’ expectations. Conservative fundraising is pragmatic and will put you in good stead.

Raising too much money leads to excess expenditure and wrong judgment

No matter whether you raise $2 million or $6 million in the same timeframes, the raised amount will be spent anyway. More capital means spending more liberally. You may go overboard and spend unnecessarily on hiring more staff than needed – PR firms, promotional events, etc. However, it should be the other way round. 

You should first create a budget for your startup and spend only 70% of the raised amount in a period of two years or so. You will gradually realize how your startup’s prospects have been harmed by overspending and undervaluing it for other rounds of funding. This must be avoided at all costs to ensure your startup’s success.

Company valuation is harmed due to overfunding

Many VCs want a strong return, which may be 10 to 30 times their investment. The success of your company will depend on the money you have raised and achieved its goals. Just think what it would be like if your pre-money valuation of the company is much higher than it should have been. Such a price range won’t be supported by the market. You won’t be able to pay back to the investors at a multiple of what was raised initially. Your company will run a high risk of being undervalued. You won’t be able to raise funds in other rounds. You should first raise a modest amount, grow your company, and then set a high post-money valuation for your company to get bigger returns.

Unavoidable conflict of interest between startup founders and investors

Investors always think of getting high returns. Profits usually are the number one priority for them. They will try to influence you in decision making, which you may not like. Don’t land in such a situation where there is a conflict of interest between you and the investors. You should rather make efforts to make your startup sustainable and boost investor confidence. Focusing on capital efficiency and raising the right amount of money will avoid such unpleasant situations.

Exit options will be hurt

Every investor wants a lucrative exit option. However, when a startup goes into overdrive by raising too much capital through aggressive fundraising in the early-stage, the exit options for investors are surely hurt. For example, if you raised $20 million in Series A funding at a $30 million pre-money valuation, it will lead to a post-money valuation of $40 million. 

A 10-fold increase in value will be expected by early-stage VCs. They will be looking for an exit valuation of $400 million. This excludes additional investors joining the later funding rounds. Exiting under $150 million will be impossible with many investors in the fray. This will severely undermine your startup’s valuation. VCs may resort to exercising their discretionary power of veto rights to legally prevent an acquisition if the offer price is abysmally low. This will hurt exit options.

Bottom line

There are lessons to be learned when it comes to raising money for your startup. There are multiple hazards if you are unrealistic and aggressive in your fundraising drive in the early stage. The reasons are many and already stated. Your success story depends on being realistic and having your objectives clearly defined. Don’t expect too much too early. Wait for the right time and the appropriate valuation of your company. Being pragmatic in fundraising is the mantra of success of your startup.

5 HealthTech Trends That Will Shape 2021

The outbreak of COVID-19 has helped people gain awareness about health and created a necessity for the rapid growth of healthcare technologies backed by AI & ML services. It has revolutionized the way doctors diagnose a disease and treat it. Taking on the situation, the global tech giants are gearing up to integrate more health-related equipment in daily used gadgets for us.

As the healthtech trends bloom into a promising decade with 2021, Deloitte Center for Health Solutions releases a report stating the benefits of integrating technology into healthcare environments. It stresses using mobility solutions in the diagnosis and monitoring of patients at hospitals. At the core of this implementation of technology into healthcare lies the evolution of AI and Virtual/Augmented Reality with the success rate of almost 97% of satisfaction to patients, 62% of increased confidence in doctors, and 94% of better treatment compliance, as per the Deloitte’s report. 

In a recent report about AI and healthcare, Accenture says that the existence of growth opportunities in the healthcare AI technologies is good for futuristic economies. The Compound Annual Growth Rate of companies registering in the healthcare AI tech has increased to 40%.

Keeping in mind the patients’ comfort and simplifying the complex tasks of the healthcare workers in their day-to-day responsibilities, the growth of healthcare technologies is moving towards the following five verticals in 2021.

1. Telemedicine

Delivering healthcare technological solutions through Internet and communication has never been easier than in 2021. The fully evolved telecommunications through high gigabit-speed Internet have led healthcare professionals to lean towards remote diagnosis and treatment through virtual consultation during the pandemic. 

According to a report by CDC, virtual consultations have increased by 154% in March 2020 compared with the same time a year before. As the adoption of communication technology is evident by these statistics, we can project a fair growth in the telemedicine industry in 2021. The governments waiving licensure requirements in countries like the United States vouches for the same.

2. 3D Bioprinting

3D Bioprinting technology changes the way we see artificial body parts implanted through intense medical procedures. The tissue regeneration technology assures the precision fit of the implants for the patient during the surgery. It uses the living cells as a printing material for the digital models designed on computers according to the size variations required for the patient. 

The significance of 3D Bioprinting can also be seen in the medical education sector. The study of human anatomy can be made easier and practical for students in medical fields. As the outbreak of COVID-19 has already shifted focus of the entire world towards the healthcare sector, the advent of 3D Bioprinting machinery in hospitals around the world is not so far. With low competition and high demand for the 3D Bioprinting tech, no company that can afford to invest in this market would like to miss the opportunity to make a fortune. 

3. Wearables

The invention of wearable technologies has contributed a lot to the healthcare industry. The personalization of healthcare has become a reality with the adoption of wearable technologies in people’s lifestyles. These autonomous devices can be worn as smartwatches, smart rings, smart jackets, VR headsets, and so on. They capture and analyze the physiological data in the form of temperature, heart rate, blood oxygen level, and blood pressure. The involvement of AI even detects emergencies and notifies the emergency services through SOS calls.

Tech companies are looking forward to making their own devices as people have grown much more conscious about their health in the wake of COVID-19. According to the GlobalData survey, the wearable tech market was rising to $23 billion in 2018 and is projected to grow to $54 billion by 2023. This was the statistical record before COVID-19. With the pandemic and the ensuing increase in market demand, it is surely to grow even higher. The 14.1% market growth of wearable tech by the second quarter of 2020 guarantees the same.

4. AI Diagnosis

Artificial Intelligence in medical diagnosis is aimed to overcome the limitations in the existing pathophysiological process. AI is used in radiology to characterize a disease through intelligent Machine Learning programs. The increasing demand for doctors around the globe due to the pandemic seeds the necessity of AI and ML to finish the medical processes in possibly less time. As AI and ML blend in together, they reduce the error rate by accessing the big data analytics about the human body. 

AI is also used in pathology to record large volumes of data that can be analyzed and used against predictive patterns. It can be used to automate time-consuming tasks like personalizing treatment based on the patient’s medical history. Its main application is in diagnosing patients with cancer-oriented cognitive systems. The ML algorithms synthesize large amounts of information in making decisions for further medical procedures in this regard. 

COVID-19 has made integration of AI and ML in healthtech a top priority. It can likely help detect future viruses and abnormalities before they get out of control.

5. Virtual Reality

Virtual Reality has been adopted into healthcare not just to diagnose but also to train doctors through simulated virtual environments. VR is already used in virtual robotic surgeries to avoid human risks and complications. This technology recreates the virtual human response system to learn about any likely impediments in a surgical procedure. When it comes to diagnostics, VR helps in creating the model of a scanned subject for a better visual presentation for doctors to identify problems and underlying risks.

It is reported that the VR market in the healthcare sector is to grow up to $2.2 billion by 2027 compared to 2020’s market size of $336.9 million. The growth rate performs at 30.7% annually for a promising 2021 and beyond.

Final thoughts

The pandemic has shifted the focus of the world toward development of healthcare technologies. Evolving computational and data technologies are fueling the advent of new innovations in the healthcare industry. The adoption of 3D Bioprinting, AI and ML, secure telecommunication, and Internet technologies have been a great support during emergencies. The necessity to adopt more and more technology into day-to-day healthcare procedures is pretty much evident from the current successful applications. The world is opening arms to embrace more sustainable solutions in the healthtech industry in 2021.