By Gadiel Morantes
Blink and you might miss an added wrinkle to the startup game. Any number of factors contributes to its evolution, but there will always be one constant: the spirit of competition.
Plans and intentions for startups pop up constantly because the market is becoming more and more saturated with those trying to make their mark. A massive and diverse ecosystem of different startups has developed. And, as in any environment, some species prosper while others wither away.
Just look at this telling statistic: Only 1 in 10 startups survive. There are several reasons for those failures, but one potential lifesaver I’d like to focus on is the role of connecting with other startups and how it plays a role in survival.
Sure, you’re fighting to keep your vision alive. But sometimes, the key to startup success is finding a balance between outworking the competition and working with it.
Stay alive by staying in the system
When you work with others and foster positive relationships, you lessen that chance of failure, which can lead to plenty of good things coming your way. In my experience, startups generally get the following invaluable benefits when they begin collaborating with and supporting other startups:
Finding your place in the startup system
It helps both sides when you share stories of surprising defeats or unlikely victories, but these benefits only come through strong bonds with other startups and their founders. And it takes work for those bonds to form.
Here are four tactics I’ve used to help young businesses find common ground with colleagues and thrive in a startup system that, at times, can be cutthroat:
1. Get acquainted with the system. When I network, I try to build relationships with other companies offering complementary services. That way, they refer clients who might need accounting services to me, and I do the same for clients who might want their services. It’s a huge win-win, but it only happens because we get along and make an effort to keep in touch.
Cast a wide net, be gregarious, and seek out people with similar interests. Put reminders on your calendar to catch up with them. It’s common business knowledge, but it provides so many benefits for those who take advantage of it.
2. Give time and value to others. I’ve seen mergers that began as two founders spending time together and trading ideas — sometimes, it’s that simple. Once you’ve established yourself and have knowledge and expertise to offer, start sharing it.
Spend time with industry colleagues and demonstrate that you’re informed and experienced. It’s a great way to build trust with your contacts, while also opening the doors to potential partnerships and mergers with other interested companies.
3. Put like-minded people together. A great way to build your network is by helping others construct theirs. By providing introductions to people who will benefit from meeting each other, you bring demonstrative value and position yourself as a well-connected resource. Again, that kind of worth will be remembered and rewarded.
4. Encourage healthy competition. When we coach founders on their pitch decks, a common issue is the clarity of their value proposition. Founders need to develop differentiation by showing how their product is unique.
One way to figure this out is to look at the competition. Networking with competitors often reveals uniqueness through contrast. There is often enough business for everybody, so when you discuss business with competitors, don’t see it as divulging secrets. Instead, look at it as a way to share different approaches to a common issue.
The startup environment can be a rat race, but it’s that fluidity that sometimes keeps your company alive. Young companies can be competitive without being contentious. Whether you’re a big startup or just beginning, try to find ways to make connections and help the startup ecosystem grow.
Image credit: Flickr/Dennis Skyley
Gadiel Morantes is the chief revenue officer at Early Growth Financial Services, which addresses the lack of on-demand financial support available to startups. With more than 15 years of experience in sales, marketing, and operations, Morantes helps founders streamline the relationship between the sales and business departments and coaches early-stage companies on setting up an optimal infrastructure for success. Follow him on LinkedIn.