It’s not an easy task to generalize mistakes or to analyze it through a linear platform. Mistakes can happen at any instance, under any circumstance and can have forms of infinite variance.
Researches however always delve into the daunting task of modeling mistakes so that the risk factor in any business can be mitigated with knowledges. Through researches, it was unearthed that there are three common mistakes for which many startup companies find themselves buried under the ground even before they live up to its fullest.
“We have absolute faith in our concept.”
Startups often fail to understand the vendor market because they fail to do a proper research. Fintech startups cannot skip the research step and go straight to development and here the mistake is made. All organizations need to study their market, their competition, potential competition and tangentially related companies before they should even think of starting up the company. They need to go to fintech expos and have personal conversations with bankers; at least to know about the market gaps that are lying ahead.
It is surprising how many traditional startups genuinely think their product is going to change the financial landscape. However often their product creates a solution to a nonexistent problem; or has even already been created by another vendor or bank’s IT department.
In a way, fintech startups and financial institutions operate with fundamentally different outlooks. Startups are comprised of individuals risking it all on their new product, while financial institutions are made up of people who manage risk for a living.
Though a startup might think their innovation and technology is a necessary tool for financial institutions to stay relevant. However the reality is that the only reason they are purchasing the product is pressure from the retail side. Startups need to understand this in order to manage their expectations and prepare their sales strategy.
“Our solution is so great it will sell itself.”
Many fintech startups dream of becoming the next Uber, but no matter how great an innovation is, it will not sell itself. Sales and marketing should not be an afterthought therefore. If there are not carefully thought out plans in place or people hired specifically trained in sales and marketing, a financial technology product will not succeed.
Having an experienced marketing or sales professional is necessary, but startups should rely on more than an individual team member. Many fintech startups suffer setbacks after their key salesman with 20 years of experience, who promised they had customers in the bag, quits shortly after joining the startup for a more stable paycheck at an established fin tech company.
It’s true that fintech development occurs at lightning speed; financial institutions, on the other hand, do not. There is the potential for very long gaps between starting marketing efforts and seeing results. Sometimes even a year may pass between a fin tech startup making initial contact and closing a sale.
“Our website is still under construction.”
In a straight answer, to make sales, an optimized website needs to be fully constructed. Credibility is necessary to close a deal, and the information on a website can either build credibility or hinder it. Having a potential client visit a website after conference that only contains the phrases “Coming Soon” or “Under Construction” will discourage anyone from doing business with the startup.
Fintech startups repeatedly make the mistake of not using their website to its fullest extent and then complaining they aren’t making sales. A successful sales plan starts well before the marketing or sales efforts begin. A startup’s website should be viewed as a lead generation tool, not just a checklist requirement.
A recent survey found on the issue revealed that 64% of respondents said a vendor’s online content had a significant impact on their buying decision. Additionally, 34% of respondents strongly agreed that the successful vendors provided a mix of content to guide them through each stage of the research and decision-making process. Integrate all the elements required for a successful sales strategy into the website; include product features, marketing materials and media coverage. If the startup doesn’t already have any coverage, include links to related industry issues. A website is the space to prove credibility and jumpstart sales.
Therefore if you are planning to be the next start up in this industry; please do not forget to at least think about these three mistakes; you might not even realize and end up with one of these mistakes!