Here’s a spoiler: 90% of all startups fail. The 10% that make it have one thing in common – they all are bringing in innovation through sustainability. These startups are all about evolving by providing faster results with less wastage. It’s a never ending process of innovating for the present and future generations.
Here are seven ways you could be a part of this movement:
1. Flexibility with rigid regulations
Startups are born and raised in very volatile environments where laws and rules keep changing. Some startup owners adopt the idea of rolling the dice and decide to deal with the situation as it presents itself. But the ones who are in it for the long haul prepare in advance and find opportunities in compliance.
Sustainable companies run a tight ship when it comes to following rules. This helps them to have a first mover’s advantage when the rules become mandatory laws. Unprepped startups have to push back to adjust to the new environment, while sustainable startups are able to easily scale forward. This gives them a competitive advantage and bigger scope to innovate.
CheckRecipient is a London based cybersecurity startup. Its job is to ensure confidential information is sent to the right person. Since the startup deals in security, it’s already working in a volatile environment. But, to make sure that compliance is followed, it uses an AI called Guardian. It analyses data points and flags up emails with unusual recipients. This helps to keep the data secured for both the recipient and the company. The startup operates by the book, which has led to its innovation in AI.
2. Bring in disruption
Startups find it difficult to deal with disruptions in the market, they have to incur higher costs for adjusting. It challenges the existing market in order to create a new market with a new value.
Disruption demands radical changes, which can be difficult for many startups, except for the ones who run on the sustainability model. Their preparedness for volatility is what helps them easily adjust to sudden changes. This helps them find opportunities in disrupted markets.
The issues like climate change and resource constraints are going to change how business will be done in the 21st century. Even established businesses whose models are based on cheap labor, abundant resources, and steady oil prices are seeing these resources losing its significance.
Bill Ford, the great grandson of Henry Ford, has spoken about the disruption in the automobile industry. He believes that the future is going to be a mix of car ownership, public transportation, and car sharing – a drastic change from Henry Ford’s model of private vehicles. Bill Ford’s beliefs are eventually going to play out as the basic blueprint for future Ford productions.
3. Revolutionize customer service experience
Startups that operate on sustainability are able to meet customer needs, at the same time, keep tabs on consumption levels. The introduction of sustainability has revolutionized the customer experience.
Startups that run on sustainability tend to focus on providing social equity as part of their customer experience. When customers realize that using your products will have a positive effect on the environment or on fellow human beings, it amplifies the customer experience. There is a simple reason to it – doing good makes people feel good.
This shift in focus helps in the creation of an environment that is conducive for innovation. It’s through these ideas that unique values can be created, thereby reducing customer churn rates.
For instance, trade-ins have increased engagements. When customers give away their old product for new ones, it certainly adds a charm to the experience. However, when the customers get to know that their old products will be recycled and given away to people from financially weak communities, that calls for immediate customer loyalty. It’s through such innovative ideas that startups are able to provide an unmatched customer experience.
4. Getting the right investors
Some see sustainability as a hurdle in capturing the interest of big investors. While some see it as a filter to get the right investors for their business model. Investors who expect supersonic growth like that of Facebook and Snapchat, would not put their money on sustainable ventures.
This might actually be a blessing in disguise. The investors you eventually end up with would be there for the long run. Moreover, such investors will provide for a greater R&D budget. This means you are able to execute an uninterrupted sustainable model right from the get-go and create the possibility of scaling innovation strategies with a strong capital.
Elon Musk, an investor, and CEO of SpaceX is one of the best examples of sustainable capitalism. He had invested his own money into projects such as SpaceX, Tesla, and Hyperloop. Over time he has created a unique value economically and socially, that has fostered ground breaking innovations.
5. Keeping a tab on resource consumption
Startups that operate on sustainability model always keep tabs on their resource consumption practices. This invariably pushes them to have a holistic view of their supply chain – internal and external.
When you look at internal supply chain from a sustainability angle, you can reduce waste by placing good workplace ergonomics. It might pertain to reducing workplace injuries but, proper workplace ergonomics often lead to sustainable ways of operating. This allows for a work culture that embraces innovation and change.
External supply chain would be meticulously adjusted to drive efficiency through the entire value chain. When you bring in external partners into your sustainable model, you have a direct impact on their own environment and labor practices. This brings in sustainable in forms of: Product lifecycle assessments, distribution channels, energy footprint calculators. All of these will lead to brainstorming innovate strategies for new products and their supply chain.
6. Coming up with responsive business models
“It’s not the strongest species that survives, but the one who is most responsive to change.” Charles Darwin
Startups need to have a responsive business model if they expect to sustain for the long run. By making changes to their supply chains, startups would be more than willing to rework on their business model. With the introduction of new technologies and changing customer demands, these startups will always be flexible with modifying the way their business operates.
Flexibility in most cases isn’t easy to pull off. Startups that are not built on a sustainable model often find it difficult to adapt to sudden changes. They might end up diversifying by losing focus. The constant questioning between the cost of change and reduction in resource consumption will limit their business model. That’s why their sustainable counterparts have a better chance of increasing market value and bringing in quicker innovations at a lesser cost.
Beyond Blossoms is a floral store in Massachusetts. Initially, their business model was B2B where they would be in charge of floral arrangements for corporate receptions in the Boston area. With staggering delivery challenges, they changed their model to B2C. For a price sensitive customer, their products were on the higher side. So they adopted a sustainable model, wherein they moved to becoming an online florist store. The overhead costs from a physical store operations were reduced and extra attention was given to eco-friendly packaging.
7. Implementing next-gen ideas
Startups with an outlook on sustainability are more capable of scaling to next-gen platforms with their current capabilities. With a high focus on R&D, they are able to conceptualize the needs of the future and allow their startups to make those ideas into reality.
By constantly looking at ways of reducing cost and waste, startups are able to see new opportunities for the preservation of today and tomorrow. Imagine reducing the amount of water being wasted while cleaning clothes, it could trigger the idea of a waterless detergent. That’s how you can use sustainability to foster new innovative ideas.
The age of suitability is gone; it’s about sustainability – you can’t make customers love you if you can’t love the ecosystem you live in. Whether it’s the planet or a community, your startup needs to be a solution in improving the situations for everyone and everything. You have to make changes that enhance the social equity of both your startup and customers.
This will come only when startups embrace change and the only way you can scale such sudden transformations is through sustainability. Ultimately, it is about bringing in innovation for the present and future generations without hurting anyone’s wallet.