You have the money you need to launch your dream company. You’ve prepared a solid business plan. You’ve lined up a winning marketing strategy. But you’re still waiting for your business to take off.
If you’re wondering if there’s a secret ingredient to success you’re missing, there’s not. Building a successful startup is a combination of a thousand small factors. It involves diligence, patience, and knowing about the right areas to invest time and resources.
Only after you put in the work upfront — marketing research, finding gaps, and going through trial and error — will your business start growing. However, there are some ways to expedite this process. By avoiding common mistakes and implementing proven strategies, your startup will grow much faster.
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Lessons for growing a startup
In this post I’ve compiled the most significant lessons I’ve learned from growing three startups from zero to over a million (including Hubstaff).
I’ve been growing startups since 2004 when my dad bought me a book about starting online businesses. I have grown a golf education company, an SEO agency, and a SaaS company with partners and employees who work remotely.
While every business is different, most of the lessons here are applicable across many business types and industries. My speciality is building online businesses, and, more recently, SaaS businesses like Hubstaff, so you’ll get the most value from these lessons if you’re in a similar field.
The lessons below are spread over twelve different areas that represent major business activities. You can read them in any order based on your most pressing challenges. They aren’t necessarily designed to be read from top to bottom.
1. Product is more important than marketing
Proponents of marketing will tell you that it trumps technology in startup development. My experience shows the opposite. The time and financial investment in product development has brought a higher return on investment (ROI) than marketing has for all three businesses that I’ve grown.
The reason? People discover your product and spread the word about it at their own convenience. They don’t do what you want them to do. The quality of your product is what makes people talk about it far and wide.
2. You don’t need to ask anyone’s permission
Entrepreneurship is about dreaming big. It’s about the wild ideas that nobody believes in. Don’t let people’s opinion stop your momentum. Build and do the things that feel right. Don’t worry about what others may say or think.
3. Follow your gut feeling
You are making decisions for your own startup — and your own future. Trust your instincts because you are the one behind the steering wheel. Even if your business flops, you’ll still learn a lot. The lessons you experience yourself are the ones that make the biggest difference.
4. Implement fast
Speed is crucial for startup development. Moving slowly kills your business quickly. Don’t aim for perfection in your strategies. When you get an idea, do a fast test. Judge the results and implement. Then see what happens. Repeat as needed.
5. Envision the best and the worst
You have full responsibility over your business. While exhilarating, this fact can also be intimidating. Imagine the best- and worst-case scenarios. Weigh their probabilities. Then use sound judgment and move fast.
6. Keep the right team size
There is no predefined team size you have to stick to. You need to find the balance that works for you. At Hubstaff, we’ve learned that we operate better as a smaller team. It makes us more productive. For us, a bigger team means more “discussion” and meetings.
7. Your company mission matters
It takes effort to craft a powerful company mission. But the reason for the existence of your startup, or “the Why”, is a valuable source of inspiration for your team and yourself. The intrinsic motivation to run your business is what can lead you to success.
Use the power of belief in your hiring too. If you are selling dog toys, hire dog lovers. They will make customer-driven decisions without requiring constant guidance. They’ll have the passion for it.
8. Give people freedom
Micro-management kills productivity and team members’ personal drive. Don’t worry how people are spending each minute of their work time.
Instead, assign them the right tasks according to their skillsets and interests. Inform them about their priorities. Train them on how you expect projects to be delivered. This will encourage employees to take more ownership of their work.
9. Your job as a leader is to help your team succeed
Managing people is not about requiring complacency and obedience. Your priority as a leader is to remove obstacles that are impeding your team from excelling. You need to empower team members to perform at their best.
10. Be direct
Being an effective and inspiring leader means you have to communicate clearly. If you want something, don’t be afraid to ask for it. This direct approach saves everyone time. People can then trust you because they understand that you don’t harbor secret agendas.
11. Set expectations
Direct communication goes a long way. It also applies to the results that you want your team to achieve. If you set clear expectations, management becomes a lot easier. Everyone knows what needs to be done.
12. It takes time to grow a startup
Growth doesn’t happen overnight. You need to accept this to save yourself a ton of anxiety.
We started building Hubstaff in late 2012. We didn’t take paying clients until August 2013. Our monthly recurring revenue (MRR) was $21,706 in 17 months. That’s an average of $1,276 per month added in MRR, which is not a lot.
In October 2016, we were growing at around $7,500 additional net MRR per month. It still seems like growth is not so fast. This worry does get to me from time to time.
13. The silver bullet to growth is that there is no silver bullet
Leave aside the illusion that there is a secret potion to success. You need to try out different strategies. You can figure out what works for your startup only by looking at your data.
14. You need to experiment and invest in what works
The goals of your strategy can change dynamically. It can be difficult to find a winning approach in such a fast-pace environment.
Keep experimenting. Identify which of your channels are attracting customers. Then focus on amplifying your efforts on these channels. Adapt your approach quickly and don’t hold attachment to past ideas.
15. Churn does suck
People will come and go. Churn hurts, but it’s part of the game. In August 2016, we got about $15,000 from new business. Soon after, we gave $9,000 of it back. What did we do? We just moved on.
16. 80% of your growth will come from 20% of channels
Realizing you can’t invest equally everywhere will help you focus your efforts. Don’t spread yourself thin. Find the strategies that bring benefit in your situation. Spend 80% of your time on the 20% of the channels that matter the most.
17. Keep exploring who your customers are
You can never know enough about your audience.
After four years of developing Hubstaff, we are still studying our customers. We keep realizing new aspects of who they are and how they find us. This attitude is of utmost importance when growing a startup.
18. Learn all you can about your audience
Stay curious about your customers. Use your imagination and research where they hang out. Figure out where they spend their time online. Find out what tools they use. Get to know the people they listen to.
In the B2B market, most of the time your customers are not right in front of you. They are usually one step away.
Development (from a non-developer)
19. Hire A+ developers
Don’t save money on development. Invest in the top developers you can hire. Nothing kills a product faster than software bugs. Plus, good developers will get the job done much faster. The bill will be the same at the end.
20. Everything is technical now
Never underestimate the power of technical knowledge. If you can have marketers who understand your technology, go for them. Implementation is key, and it requires technical knowledge.
21. UX is hard if you are continually changing your product
It’s not easy to settle for a UX when your product keeps changing. Do your best for the current situation. But also project your layout for two to three years down the road. Make sure your design will still work for your product then.
22. Kill email
Email can only slow you down. Instead, communicate with your team in your project management tool. This way the needed information is visible to everyone on the team at all times.
23. Assign team members a manageable number of tasks
You should never overburden team members with loads of tasks at once. Instead of assigning 100, just give three to five specific tasks. This approach gives everyone clarity. It forces you to prioritize your team’s activities. It makes people’s priorities clear too.
24. Use a solid project management system
Don’t scatter your team’s work over numerous tools. Choose a project management tool and keep all data there. Documented communication saves a ton of time and increases accountability.
Not persuaded? Imagine two scenarios. You need to onboard a new manager. You have all project tasks and exchanges for the last 12 months in your project management system. You know what to do. Then imagine the same onboarding process, but all you have is your email records. Hellish, right?
25. Most customers will find you via search
Even with the most sophisticated marketing strategy, people will mostly find you via search.
They might have heard about you and then researched your product. Or they may just be looking for what they need by using a keyword. Your search rankings are important regardless of whether search is your number one channel or not.
26. Leads from search convert better
Leads that find your business from search typically convert at higher rates. People “found” you on their own. This makes them feel like it is their solution rather than someone selling them one.
27. Search marketing is more than just ranking well in Google
Making a real difference with your search marketing means you have to think beyond Google. You can leapfrog by ranking well on product listing websites like Capterra and GetApp. They have high search rankings and are well-known. Often you can even pay for ranking high on such websites.
28. Niche works best
Don’t underestimate your SEO efforts. Instead of going for a top general keyword, aim to rank high for many niche terms. This will give you solid overall traffic that will be more targeted.
29. Use the power of content
Content is a powerful force for attracting and educating an audience. At Hubstaff, content is one of our top acquisition tactics. We get many new visitors via search. Less people find our content via social channels or influencers.
30. Social is great for branding
Your social media channels deserve some attention, but don’t expect direct sales. Social can bring you visibility and brand recognition.
Social has not resulted in direct clients for Hubstaff, but it has been instrumental for our brand building strategy.
31. Turn your support staff into an educated sales team
Most people have several questions about a product before they make the purchase. How well you answer can decide whether they buy yours or not.
We have transformed our support staff into a mini sales team. We serve people quickly and intelligently. This helps increase the trust in our product and brand.
32. Choose the right support communication tool
You don’t have to struggle with support on your own. You can use a support communication tool that matches your needs.
We use Intercom for our support communication. We also have a WordPress theme for the support documentation. People can start a conversation with us through a simple web form. This approach is flexible and has proven to be efficient for Hubstaff.
33. Explore tools beyond Google Analytics
You constantly have to measure how you’re doing. Analytics tools are your best partner in crime here. There are a number of options beyond Google Analytics. At Hubstaff, we complement it with Woopra and Segment.
34. A good analytics system is worth its weight in gold
Being able to judge whether you’re on the right path on the basis of data is priceless.
Setting up your analytics system does take time and money. But the investment is meaningful. If done right, you will be able to conduct split tests and dig deep in your data. That’s how you can understand what’s happening with your product.
35. Use Dribbble to find top designers
Don’t settle for a mediocre visual identity and design. They are the face of your product. If you can’t hire a designer, you can find a top freelance talent on Dribbble. The service costs $20 annually. Then you can search for the most relevant freelancer available for hire.
36. A great logo is hard to get
And you certainly need a great one. Hiring a top designer is crucial here. Get an A player and let their creativity shine.
37. Great design goes a long way
Great design is not a fad. It starts with aesthetics but it also encompasses usability. People expect a well-designed product. If you don’t deliver, you lose trust from the start.
38. Hiring is a numbers game
Hiring involves thorough research and extensive communication with candidates. You might have to go through 500 resumes to find the right person. That’s what we do at Hubstaff.
39. Building your team is worth the investment
The hiring process is a time monster. But growing your team is the only way to progress. It’s how you can double and triple output. When we’re in hiring mode, I may end up spending 80% of my time on it. It turns into the most consuming activity on my agenda. Yet the investment is worth it.
40. Don’t be afraid to look for people in unconventional ways
Who said there’s one right way to look for talent? Don’t limit your hiring efforts. Reach out to people just like recruiters do. Find new ways to announce your positions. Invest in authentic employer branding.
41. There are more reasons not to take an investment than to take it
Seeking an investment is a good move for some businesses, but you need to determine the right moment to take one. We ultimately made the decision to bootstrap Hubstaff rather than take investments. This has given us the freedom to keep full control of our business and aim for generating more revenue.
42. Focus on revenue before capital
Instead of building up capital, put your revenue first. Find the money-making mechanism for your business. You can get a much better valuation this way.
43. Raising money is a huge distraction
Looking for investments is a time-sucking machine. If you need the money, you have to go through the process. But if it’s not a priority in the moment, don’t make it one.
What are your startup growth lessons?
These 43 lessons can’t make your business grow overnight. But combining all of them with your own experience and learnings can bring you a big win.
What are your most valuable lessons from building a business? I’d love to learn about your insights in the comments below.