The world we live in today is mutable. Uncertainty can be an unsettling aspect of reality to negotiate, in the world of business as much as pleasure. However, if you’re setting up a company, there’s one thing you can rely on: you’ll never be short of advice.
It’s a shame then, that the four most important (and obvious) aspects of building a company are largely either absent or a side note. They are: product, profitability, sense of purpose and a large addressable market, and I never cease to be amazed by the number of intelligent, engaged entrepreneurs who completely fail to recognise them as the pillars of a successful business.
Let’s take product first. “That which is useful is good” is a concept that found its place in ethics centuries ago – and it’s an idea that should be intrinsic to any product or service you offer. Does it address a real need? Is it meaningfully useful to people?
Innovation is often disruptive. Releasing a product that challenges the status quo can generate resistance and the greater the likely impact, the more powerful this resistance may be. This brings us to another of the fundamentals of building a business: sense of purpose.
The power of the single-minded entrepreneur should not be underestimated. Conviction is crucial and in my case it has been fostered by a belief in the quality of the Hotspot Shield and the social importance of what it aims to achieve for internet freedom, online privacy and democracy. Social, political and economic changes can affect the way you do business, but keeping sight of your aims will safeguard its integrity.
Now to profitability: in simple terms, a fundamental factor in a successful business is sustainability. As an entrepreneur, it will always be tempting to get caught up in add-ons, embellishments, smarter strategies and more hiring. These are of course important business functions, but all too often they supplant rather than support the basic concept of becoming profitable as fast as possible, and focusing on the P&L.
The most obvious success story to mention here is Apple. It sold on the strength of its product (the iPod), focused on P&L and became the most valuable company in the world. The most successful entrepreneurs are those able to balance the claims of their product with profitability.
The consumer market values a company not solely by revenue but by the number of users adopting its product; therefore, it is vital that there is an addressable audience large enough to provide a large user base. Such a user base will also create plenty of scope for developing new strategies to monetize it effectively.
These four pillars are difficult to establish and demand significant support, which is what makes them such definitive precursors to success. Once they are in place, a business is in a far stronger position to be meet further challenges and absorb risk.
A commitment to improving society has often been seen as a hindrance in the world of big business, but if you have the right product, profitability and user base, being faithful to your ideals can become your biggest asset.