Successful Startup Strategy

Creating a successful startup is difficult. Most people never pursue the journey of building a business because the failure rate is so high, and the time and resources it takes to build a business are massive. To create a successful startup you need to think strategically and focus on the parts of your business that yield the most results. A good startup strategy is key to your success.

Bootstrapping Your Business

Bootstrapping is very common in the early stage of most successful companies. A typical business startup has very little resources, so the entrepreneur has to be very resourceful. With little capital or human resources, the entrepreneur needs to wear many hats. At the starting stage, the entrepreneur spends about 80% of the time thinking strategically about a differentiated business model with the hope it would scale.

Think of DNA and how its building blocks are comprised of just four nucleotides. It’s so compact that it fits inside the nucleus of a single cell, but it scales to become you – a grown up human.

What is the DNA of your business? It’s the core business building blocks that when replicated can become a franchise or scale larger.

Just like the primary ABC functions of airway, breathing and circulation, what are the ABCs of your business model that need to be built and operating to make your business DNA come alive and function?

The 80/20 Principle

The key to this is focus. How you focus is by thinking in terms of the 80/20 Principle. The 80/20 principle shows that 20% of the inputs lead to 80% of the outputs. In the digital world, this number skews higher to 95/5. So if your model tells you 10 things are required, what are the two that would give you 80% output?

Paradoxically, the reason the 80/20 principle holds true is that most often people try to do the top 10 at the same time. Yet the top 2 might only take 20% of the time and yield 80% of the results.

The 80/20 principle also applies to time to get results.

Getting 80% of the output takes 20% of the time. To get the last 20% output takes 80% of the time.

The 80/20 Principle is also fractal.

This means that there is an 80/20 inside each 80/20. So let’s expand the business to 100 ideas that would make it super successful.

20 ideas yield 80% of the results.

The next fractal 80/20 of the 20 ideas is 20% of the 20 ideas, which would be 4 ideas yielding 80% of the 80% results, being 64% results. 

4 ideas yield 64% results. 

The next fractal is 20% of 4 ideas, which is 0.8 ideas or rounded up to 1 idea, yielding 80% of 64% results, which is 51%.  So out of the 100 ideas, there will be 

1 idea that yields 51% of your business.

This is the core idea of your business. Your DNA. Your ABC. Find your core 80/20 fractal to find the core DNA of your business.

Test, Measure and Prove

But these ideas have inherent assumptions. These assumptions need to be tested, measured, and then adjusted accordingly. Amazon, for instance, conducts a vast amount of experiments to innovate for their customers.

Outsized returns often come from betting against conventional wisdom, and conventional wisdom is usually right. Given a ten percent chance of a 100 times payoff, you should take that bet every time. But you’re still going to be wrong nine times out of ten. We all know that if you swing for the fences, you’re going to strike out a lot, but you’re also going to hit some home runs. The difference between baseball and business, however, is that baseball has a truncated outcome distribution. When you swing, no matter how well you connect with the ball, the most runs you can get is four. In business, every once in a while, when you step up to the plate, you can score 1,000 runs. This long-tailed distribution of returns is why it’s important to be bold. Big winners pay for so many experiments.”

Jeff Bezos

The reality is that most businesses fail. It’s just a question of time. How many companies last one year, ten years, one hundred years or generations?

Most businesses start off with cash flow problems. Most businesses take years before they become profitable. A small percentage of business ideas become profitable quickly, but that is because they had the vision of a core DNA of the business and executed well on the 80/20 of the ABCs.

How Venture can Help

In this unprecedented time of great opportunity and change, new industries will arise and old industries will be transformed. is geared for the startup entrepreneur who will bootstrap their business to execute the ABCs of the core DNA model. The right domain name will help you implement your startup strategy and give you a shot at real success.