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3STRATEGY FOR SUCCESSFUL START-UP LAUNCH IN THE RUSSIAN ECONOMY
(WORK EXPERIENCE)
In the modern Russian economy, start-ups begin to play a significant role - young and ambitious companies aimed at the rapid implementation of a new idea in order to earn high profits. The economy of our country is being transformed and its innovative potential is increasing due to the development of the start-ups system. A successful startup needs not only a promising idea but a clearly structured strategy to implement an innovative idea, avoid possible risks, prevent errors, select a viable team of like-minded professionals, manage investments wisely, produce, sell or provide in-demand and competitive products and services. Having broad experience in the field of launching startups in Russia, we try to consistently examine each component of a competent strategy in this article so that businesspersons could use it and implement their innovative ideas in startups.
Keywords
startup, startupper, strategy, businessperson, innovative business, marketing, financing, investment, startup team
AUTHOR
Dmitry V. Andryushchenko,
Businessman, Director General of South Trade Group LLC 7, Kotlyarov St, Krasnodar, 350016, Russia d.v.andrushenko@mail.ru
1. Introduction
A young business, which is aimed at implementing a promising idea in order to quickly achieve high profits is traditionally called a startup. If a few years ago it was necessary to have an innovative idea for a startup, then recently this term simply means the launch of a new business. Typically, the most successful startups are run by young businesspersons with a high level of ambition. The process of implementing an idea in a startup involves a high degree of risk, low chances for success and the need to assemble a professional and viable team. The life cycle of any startup consists of passing through certain phases or stages of development, these are: the origin of an idea, the immediate launch, the development and expansion of horizons. For example, having launched a startup on the basis of a loss-making outlet in Krasnodar, we already have a developed network of stores at the moment. And there are many such examples.
2. Discussion
In his book "The Hero with a Thousand Faces", the American scientist mythologist Joseph Campbell formulated the concept of "hero's journey" based on the world heritage in the field of mythology and religion clearly highlighting its structure: call; giving up the call; threshold crossing; gaining custodians; face to face with demons and shadows; development of the "inner self"; transformation and coming home.
If you project this structure onto the path of a startupper, you can find analogies with the process of establishing a new company. Any startup begins with an idea, sometimes it is rather illusory, it is just an idea of a goal and likely prospects at the initial stage
(call). Bringing this idea to life successfully is possible only through overcoming doubts (giving up the call), stepping over the stamps of traditional business (crossing the threshold), recruiting a viable team and finding reliable investors (gaining custodians). It is imperative to go through the "valley of death" (face to face with demons and shadows), reach the stage of stable growth and profit, achieve success and prosperity (development of the inner self, transformation), expand the startup network and share your experience with colleagues (coming home).
Startups are significantly different from our usual concepts of "entrepreneurship" and "business" because they are aimed at innovation, high growth and profitability, and investment. A startup can be launched by both a young and an experienced businessman; even a large company can launch it. Startups do not have to work for a large market, they are start-up business projects with very illusory prospects that can be implemented in almost any business.
Startuppers are characterized by ambition, the desire for rapid growth and high profits. This is what attracts venture investors who, despite significant risks, prefer startups to small businesses in order to get multiple profits. Besides, startups, unlike large companies, are flexible, quickly adapt to changes in the market, independent in decision-making, and demonstrate a good response to the wishes of consumers.
3. Materials and Methods
In the process of generating startups and advising fellow businessmen on their launch, we came to the conclusion that more than 90% of novice startuppers make a number of serious mistakes when organizing a new company, which results in failure. First of all, the startup itself, as an innovative business, should not be treated emotionally, and you should take the attitude of a businessperson-manager.
Among the most common mistakes of novice businessmen are the following:
1) Misconception about a startup. Many people believe that the most important thing for establishing a new company or enterprise is to have a promising idea. But until the startup has started to bring a stable profit, it will be limited to the framework of the thinking process and will not be valuable from the point of view of the economy.
2) In addition, a large percentage of startuppers attach too much importance to investments, but this is fundamentally wrong. It is most productive to launch a new business with your own funds, and initially treat investments as someone else's money that imposes certain obligations on you. Therefore, when launching a startup, investments are likely to harm and reduce the motivation not only of the team, but also of you as a leader.
3) Some startuppers are often let down by excessive self-confidence and their righteousness about how to quickly succeed in business. This trend is sometimes called the "teenager syndrome", when a businessman is absolutely sure in his idea about the development of his innovative idea in a startup.
4) The financial component is very important in a competent strategy, which must be scrutinized. Our personal experience suggests that start-up businesspersons quite often invest financial and other resources in the product itself, the demand for which has not been fully examined. The lack of various resources results in problems for marketing and sales of products.
5) A lot of startuppers aged 40 and older when starting a business are very hampered by the thinking of a Soviet person. Experienced businesspersons often call this phenomenon "Sovok" management. Such businesspersons, when launching a startup, deny the strategy, methodology, try to build an innovative business on the principles of the "Sovok" (as the USSR has been called in some circles for a long time) and aggressive trends of the dashing 90s.
Even one of the above mistakes may well lead a startup to failure, and if you make several at once at the launch stage, then this is 100% destruction of both the idea and the young business.
Thus, there are a number of fundamental mistakes that a startup itself often provokes in the course of its work, but there is also a competent strategy - a number of necessary steps, as a model for managing a new company. In order to successfully start, a young company needs a strategy as a foundation. It serves as the basis for the implementation of any startup. The strategy makes it possible to understand which market to enter, how to present your product or service more profitably and, in general, to understand what prospects your company has.
4. Results
Before you launch a startup, like any other business, you need to decide on its scope. The driving force in the launch process should be the right idea about the future of the project and a personal point of view, which will help answer pressing questions:
1) what kind of business you are planning to launch;
2) who is your main consumer;
3) whether the product will be sold or the service will be provided;
4) what stages the startup development will go through;
5) what are your company's strengths and advantages over others.
Having answered these questions in detail, you proceed to the next stage of the strategy - formulation of the goal and tasks, as well as the definition of methods for achieving them. This stage can be represented as a tree, where the trunk is the goal, and the branches are the tasks.
With one main goal - to launch a successful startup and quickly achieve high and stable profits - the tasks should be clearly divided into two groups: short-term (from 6 months to a year) and long-term ones (up to 4-5 years). In the process of achieving the goal and objectives, the startupper again needs to answer a number of personal and business questions:
1) what do you want to achieve as the manager of a new business;
2) what will be the scope of your company;
3) whether you will work in a startup yourself or completely entrust the work to selected personnel;
4) what are the qualitative and quantitative characteristics of the produced (sold) product or service;
5) how the wishes of consumers will be satisfied.
At first, any startup needs to concentrate on the implementation of short-term tasks, because each new business concept must be carefully analyzed and you are to work out a methodology for further personal and team actions.
According to statistics, only 10% of new products introduced to the market begin to make a profit. Thus, 9 out of 10 attempts to launch a new product end in failure and significant financial losses. Despite the huge number of such failures, many of which have already become common examples in the history of world business, startuppers continue to follow the same path and the negative story is repeated many times.
That is why testing a market niche can be called an important step in a successful strategy, which will reveal the real attitude of consumers to the product being produced or sold, the service provided, i.e. the demand for it. The development of a new product, service in isolation from live buyers or customers whose opinion is the criterion for verification, will lead the company to a natural failure.
Having found your target market, you need to position your business at the same level as the majority of consumers. The strategy allows you to select the most successful marketing
moves for searching, communicating and informing the market about your products and services. Any strategy must be tested, and it is necessary to analyze all possible risks for this, especially when a startup needs serious investments. It will allow you to reach a new level, achieve success, if the startupper demonstrate flexibility and responsibility, fully actualizes, constantly improves his/her intellect and creatively builds a business model.
It is best to start your business with sales, and, in some cases, they can be made even before the product is produced, i.e., sell it to potential customers for an advance payment. Thus, communication will be established and an agreement with the consumer will be preliminarily negotiated. In case that it is possible to sell a large batch of goods for an advance payment, then a startup can do without investments and produce or purchase products independently. It all starts with the fact that a startupper begins to understand exactly how to sell the product and has already tested it in practice. That is why we recommend, first of all, to pay attention to the sales department in your startup.
An equally important component in the strategy is a reliable and viable team capable of creating, promoting, implementing a product or service. It is necessary to separate responsibilities in the team immediately: leave a small but important part for yourself and personal assistants (moreover, you need to leave for yourself the most responsible work that best demonstrates your competences), and entrust the main part to your team. At the same time, we must not forget that even the most monolithic team of like-minded people will not be able to complete a business project on their own only on sheer enthusiasm. Therefore, one-time or small-scale work should be outsourced to narrow professional specialists in order not to pay them a full salary.
It is better to launch a startup with small things, because the commitment to giant projects can lead to ruin. A new business should be based on a "grain" - a product, invention, service that can be brought to the market quickly, without investment or with a minimum amount, and make a good profit. This "grain" should be valuable and competitive, and after the first profit, it is already possible to update and expand the range of products or services.
Marketing is very important for any startup, so a competent strategy is often called marketing. Marketing is extremely necessary both in the production and in the sale of the product, in the provision of services by the company. Marketing moves should ensure a constant influx of consumers, these moves must be carefully calculated and controlled. The funds allocated for marketing should be significantly larger than for the product itself, since even a very good quality product or service cannot be sold on its own.
Both experienced and novice startuppers should not ignore external consulting. Almost every new company has a difficult goal, a large number of no less complex and serious tasks, for the solution of which experts are needed. Since a startup does not have sufficient finances at the beginning of its work, it is quite reasonable to attract a highlevel expert as a consultant. Even if 2-3 hours of his working time will cost you a lot, these expenses will pay off, because during this time he/she will be able to solve those problems that you and the team will not be able to solve even in six months without necessary competences and experience. This element of the strategy is taken from the foreign business practice and always works well. If the startup budget allows, it is possible to involve not individual specialists in consulting, but even companies.
As for investments, they are not so necessary for a startup at first. It is quite possible to start your business without them if you have a promising idea. Investors should be attracted to your business project when its main idea is verified and funding is needed only for further growth and development.
The startup strategy works well if you start building your business at a young age, no older than 23-26 years old. At this age, there is still a lot of time for experiments and errors, parents can help in some way, most often there is no family and children. This is important, since a new business project will initially take the most time with minimal
profit. 30-40 years old is also a good age for a startup, because during this period a person has already acquired sufficient experience and made start-up capital.
Even with a strict adherence to the strategy, a situation may arise when a startup is on the verge of bankruptcy. This applies to the main part of the new business, both in Russia and abroad. Therefore, the head of the company should never give up and surrender, it is necessary to analyze mistakes, review the actions in accordance with the strategy and move forward step by step.
Our experience in the field of innovative business shows that a startup that develops quickly and successfully requires serious financial investments. This is a kind of "growth paradox, in which the faster growth is, the more money will be needed to maintain growth, and the more money will be missed" [2].
Therefore, the personal income of a startupper will be insignificant during the period when a startup develops until it reaches a stable profit, and this period may last more than one year. We strictly adhered to the business plan and the chosen strategy when launching our first startup in Krasnodar and, due to this fact, our personal income increased significantly in six months.
A successful launch strategy requires the head of the company to document all agreements with customers, partners and investors. All terms of transactions and investments must be agreed before financial settlements are made, since any business is a risky thing. In parallel with this, all startup expenses must be approached very economically, even if you have seed capital. But even a solid amount of money will not be enough with rash spending.
You should never forget that a startup is a team of professionals and like-minded people that you have attracted to its creation. Very often, startuppers do not trust their people enough and try to think for team members and delve into those aspects in which they lack competence, instead of listening to their opinion and trusting their vision of problems. The founder of a business often takes on the lion's share of duties and responsibilities, as a result of which he/she constantly overworks, and the staff is underloaded. Successful startuppers act differently: they delegate the main part of the work along with all the responsibility to their team and constantly control the executives.
Following the strategy requires a startupper to plan work carefully depending on the importance of the business goal, tasks and the urgency of their solution. With this approach, the founder of the company will be able to deal with the eternal problem of lack of time, less time will be spent on current affairs and much more time on strategically important ones.
To prove yourself well in the business circles, you must always be responsible for your promises and obligations to consumers, team members, partners, and investors. Moreover, it is absolutely not important to whom these promises are given, the main thing is their fulfillment.
There is such a notion as "manager burnout", and this concept refers more to psychology than to business. Businesspersons who are very overloaded with work suffer from this burnout, their motivation to develop a startup is significantly reduced, and they lose interest in working in general. In this case, even a competent strategy will not help you. Therefore, it is vital for startuppers who plan to launch a successful business to find a balance between work and leisure, maximize positive emotions and minimize negative ones, devote more time to loved ones and friends, and travel.
5. Conclusion
Unfortunately, a significant part of promising ideas remains without implementation quite often. Starting businesspersons are stopped by many things: lack of finances, work, family, etc. A well-thought-out strategy, which is based on the experience of successful startups and projected on the implementation of your innovative idea, can help you quickly start a business from scratch, which will begin to produce high and stable profits over time.
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PROPER LAWSUIT NOTIFICATION IN THE US AND THE UK IN THE ERA OF SANCTIONS
The problem of proper notification of a foreign defendant is one of the most complex and urgent problems of international civil procedure. In the framework of this study, we will not separate the categories of proper and timely notification, but will study proper notification as a broader concept, including timely notification.
Keywords
Court notices, notification of the defendant, international civil procedure,
proper lawsuit notification
AUTHOR
Yana S. Butakova,
Head of the International Risks Department JSC "URALCHEM" 6/2, Presnenskaya Embankment, Moscow, 123112, Russia yanabutakova@yandex.ru
1. Introduction
The complexity of the problem under study comes out of the conflict of jurisdictions - a situation when several legal systems simultaneously claim to regulate relations related to the notification of a foreign defendant (Baumgartner, The Proposed Hague Convention on the Service Abroad of Judicial and Extrajudicial Documents in Civil or Commercial
