There are a lot of ways to measure the growth of a startup. Business plans, projections, and investor pitches all focus on numbers and statistics that show how well a company is doing right now. But what about tomorrow? How can you tell if a company is destined to become a unicorn?
The truth is that there are no rules when it comes to scaling up as fast as possible. Some companies start small and stay small. Others plan from day one to become big businesses. Many fall somewhere in between and grow at their own pace. But regardless of where your company falls on the spectrum, here are some signs that indicate you’re working with a growing startup.
A strong growing startup will have a clear vision and strategy. It should also be able to demonstrate traction - in other words, it should have a product or service that is already being used by the customers who are its target market.
The first step to becoming a unicorn is having a product that people actually want to buy. This might seem like an obvious statement, but it’s worth repeating. There are plenty of products out there that no one wants or needs. If you’ve created something that people are actually willing to part with their hard-earned cash for, you’re off to a good start.
Market fit is a term used to describe the ability of a new product or service to attract sufficient consumer interest and sales to become profitable. The concept of market fit is often contrasted with the more abstract idea of “product-market fit,” which focuses on the actual functionality of a product or service in relation to its target market. Market fit is often evaluated by looking at key metrics such as:
% New Customers: This metric measures how many people are signing up for your product or service compared to how many people you are targeting. For example, if 2,000 people sign up for your product during the first month, but only 2% of all users are new customers, then your new customer conversion rate would be 2%. However, if 3,000 people sign up for your product during the first month and 10% of all users are new customers then your new customer conversion rate would be 3%.
While every startup will have different metrics and figures that it will have to distill to understand which products are clear winners. When conducting due diligence, no figures or metrics are accurate in a vacuum.
Not all great products are successful, however. A key metric and requirement for unicorns is to have engaged consumers and customers. A growing startup should have no problem keeping its customers engaged. This could manifest itself in a number of ways, but some key indicators are a large number of existing customers or attracting new ones through word of mouth. If people can’t stop talking about your product, that’s a very good sign.
A startup customer engagement strategy is critical for companies to create a loyal following of customers. By engaging with your customers, you can learn about their needs and find ways to improve your product or service offerings. You can also build brand recognition and loyalty among the people who use your products.
There are several different types of engagement strategies that companies can use to connect with their customers. Personalization is one way to personalize customer engagement. For example, you can tailor the type of information that is shared with each customer based on their preferences. You can also customize the way that emails are delivered so that they are more relevant to each individual.
Interaction is another way to engage with customers. For example, by asking questions or providing feedback through surveys or questionnaires, you can ensure that they feel like part of the community and get to know them better. Finally, one-to-one communication is another way to engage with customers. For example, you could reach out to them directly by sending personalized emails or text messages.
Customer engagement is one of the most important aspects of building a unicorn, and the most successful companies develop strategies to nurture and grow their brand and startup.
A strong growing startup will also have a small but committed team of skilled individuals who are all working towards the same goal. Finally, it should be able to demonstrate customer demand for its products and services - this could be done in a number of ways, including through word-of-mouth recommendations from existing customers, or by conducting market research surveys.
Unicorn startups are rare, but they do exist. If you see these clear signs in a company, there’s a good chance it has the potential to grow into a large organization. Keep an eye out for these startups, and you just might find the next big thing.