Startup Genome launches Compass
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Alex aka Chief WOWness+
CEO and Founder of Press42.com, a site that wants to bring startups to the right bloggers, founder at Inkzee.com, co-founder and curator of Tetuan Valley, an international startup incubator based in Madrid, startup mentor at HackFWD, Springboard, Seedcamp, Wise Guys or Huge Things, partner at Okuri Ventures, Sandbox network Madrid Ambassador, Global Shaper by WEF and Startup Digest Madrid curator.
As many of you know, I’m a huge startup lover and I also love academia. That’s why, the Startup Genome project has me amazed! Someone finally started tackling an analyzing why startups fail and how to fix it (we are working on our side of that equation at Press42). Some months ago, the team behind Startup Genome released their seminal report, where they defined the 6 Marmer stages, the 4 types of startups there exists and many more amazing facts. If you haven’t read the report yet, it’s worth taking some time.
Today they’re announcing two big things, first, a report on premature scaling, what is it, how it looks like and what problems it generates compared with healthy startups. But they went an extra step, they are also releasing a web application, Startup Genome Compass, that allows you to self diagnose where your startup is, what is wrong and how to fix it.
But, what is premature scaling you might think? Here are some examples of what they’re talking about:
- Building a product without problem-solution fit
- Investing into scalability before product-market fit
- Hiring too many people too early
- Over planning, executing without regular feedback loop
- Raising too little or too much money
Also, it’s important to understand the problems associated with premature scaling, specially when it’s the first reason why startups fail:
- 74% of the high growth Internet startups fail due to premature scaling
- No startup that scaled prematurely passed the 100k users mark
- Startups that scale properly grow 20x faster than startups that scale prematurely
- 93% of startups that scale prematurely never break the $100K monthly revenue threshold
- Funded inconsistent startups have 2x valuations and raise 3x more money
- Startups that scale prematurely have a 3x bigger team than consistent startups
Brilliant work from the Startup Genome team (Björn, Max, Ron, Ertan, Fadi y Sasha) and kudos for their effort and giving us these amazing reports and tool. Also I want to thank Björn for featuring my take on scaling prematurely on their report. I feel humbled to be part of it!
Now, as I said on my previous post, first PR lesson, do a story, well, with the Startup Genome Compass report, your startup definitely has a story 😉
