What it takes to start your own business in 2021.
The changing market conditions in the last year affected the trajectory of various start-ups. Telehealth businesses, for example, saw a boom during COVID-19 when they became part of the Government’s efforts to combat the pandemic. Now turning around into recovery requires innovation, and in 2021 we’re about to see a new group of start-ups thrive.
Australia’s thriving start-up sectors
Sectors including fintech, education, healthcare, and retail, have been disrupted and accelerated over the last year amidst COVID-19. But in 2021, traditional industries with little to no history of technological capability will be the ones to watch. Long-established sectors like buying and selling chemicals, mining, oil and gas, food and beverage, and farming will be among the domains from which the next generation of start-ups will rise.
As humans, we are surrounded by technology all day, from smartphones to IoT devices and everything in between. A critical outcome of this pervasive digitisation is that many people go to work and realise that there is no existing modern technology to improve their work lives.
“The excitement, sense of purpose, and aspirations of global success that start-ups bring propel society forward.”
They become increasingly innovative at work with the tools they have available in order to streamline workflows and enhance productivity. Sometimes, without even realising it, employees are making strides every day to more effectively bring traditional industries into the 21st century.
For example, the health and beauty industry has jumped into the 21st Century by building all-inclusive tech infrastructure to streamline booking appointments, managing suppliers and creating loyalty programs.
Another successful platform we’ve seen crop up recently is in the business of selling auto parts – an industry that has traditionally run on phone calls and slips of paper. Technology marketplaces like these have come in across numerous traditional sectors to streamline processes and accelerate time-to-revenue.
In 2020 alone, our team engaged with several emerging start-up founders across Australia and New Zealand from a vast array of sectors. Liaising directly with these entrepreneurs validated our belief that truly disruptive innovation, and new waves of founders, will emerge from the places you’d least expect.
In the last 12 to 18 months, we have seen an influx of new business ideas emerging across niche sectors, from camping to decentralised identity software.
We continue to see founders in Australia from all walks of life. There has been a shift away from majority technical founders to non-technical founders, including university students, experienced business owners, new parents, tradespeople, Navy personnel, and more.
Entrepreneurs and founders are evolving
There is no longer a consistent trend around where a successful founder may come from. Despite the upheaval the last year has brought, market conditions to start a new business are very favourable and the barrier to entry is now lower.
So, what has become easier?
Accessibility to affordable and easy-to-use technology infrastructure and software has increased. Access to talent pools in the start-up community has never been more buoyant, partly thanks to the rise of remote work.
We have seen an increase in the availability of capital from angels, incubators, VC’s, banks, and large corporates, who are all keen to gain further exposure to start-up markets. Start-ups pitching for this capital now have access more pools of knowledge and advice than ever before. Learning from other founders’ mistakes and successes has never been so accessible.
There has been a rise in the number of average Australians starting a company as a viable alternative to regular employment. Drawing inspiration from seeing the success of other founders from similar backgrounds, we see a favourable shift in psyches and attitudes towards people starting their own companies.
Many are realising that there are infinite opportunities within every sector to improve business processes or an employee or customer’s experience via the implementation of new technologies. Oftentimes it can feel like all of the best ideas have been taken, but this is where the magic of being a domain expert in an untouched field can propel you towards success.
There is plenty of momentum around building new technology start-ups and everyone wants a piece of the pie. Investors, new founders, repeat founders, corporates and financial institutions are all seeking new ways to get involved in the start-up community. And why shouldn’t they? The excitement, sense of purpose, and aspirations of global success that start-ups bring propel society forward.
The key qualities of a successful entrepreneur
Grit, determination, hard work and an unwavering desire to be great play a massive role in leading start-ups to success. At Dovetail, we’ve also observed that success follows founders with certain qualities.
First, assemble a world-class founding team with highly complementary skills, domain expertise, and a desire to solve the challenge you’ve set out to solve.
Next is the proven ability to attract diverse talent across all business units from sales and marketing to finance and operations, and building the right culture. It’s often said that a good boss hires the right people.
Don’t be afraid to outsource non-critical pieces of work to accelerate time-to-market. If you and your team’s skills are better placed elsewhere, outsource to professionals who can excel in spaces you can’t.
Research is key – I cannot stress this enough. Before getting started, validate your ideas with data and evidence. Have a bold vision and aim at a big market opportunity. Be prepared to thrive, or at least survive, in uncertain and risky conditions like 2020.
Come to terms with the idea that the execution of your ideas is ultimately more important than continuous strategy loops. Bootstrap as long as you can to solidify as many proof points as possible – they can be pulled from observation studies, user diaries, empathy mapping, research, market analysis, competitor analysis, problem statements, funding, technical trends, and thought leadership.
There are many Australian success stories of non-technical founders who have executed a successful start-up. Afterpay, the Australian Fintech that was founded in 2015 by Nick Molnar and Anthony Eisen.
Armed with various commerce and accounting qualifications after university, Molnar and Eisen played to their strengths despite the obvious academic limitations to pursue the fintech start-up. They hired top-talent and outsourced various capabilities to places like Dovetail to make their business a growing success. Six years on, Afterpay is a growing, multi-million-dollar Australian-founded, globally-recognised fintech.
Another example is Provider Choice, a platform that assists Australians with their NDIS plans so they can achieve their goals, budget easily, and take back control. Despite having a background in finance, his nephew’s personal struggle navigating the NDIS drove Provider Choice Co-Founder & CEO, Tom Blinksell, to create a better tech solution.
Tom saw firsthand how difficult it was for families to find the right services, let alone understand their plan, but lacked the technical know-how to get the platform off the ground. He and his Co-Founder, Jonathan Salgo, validated suspected pain points for NDIS participants, sought out the technical expertise they needed to hit the ground running, and have built a successful platform that’s positively impacting lives every day.
Lastly, think like an investor
The unprecedented conditions of 2020 have meant investors are becoming more focused on where they’d put their money, driving fiercer competition for their attention. If you’re considering speaking to prospective investors, you need to think from their shoes early on. Be prepared with a solid plan from the get-go, a well thought-out plan to build a holistic business with evidence-based decisions to demonstrate the thought you’ve put into the business and your commitment to its long-term success. And demonstrate your understanding of any potential risks around your venture – whether that be financial, environmental or regulatory scrutiny.
This article first appeared in issue 32 of the Inside Small Business quarterly magazine