At Holborn Assets, we believe there’s a huge amount that we can learn from start up companies. Here, we cover what is common to start ups that succeed – and where those that don’t go wrong. We’ll take a look at what defines the successes first.

The people who run them believe they can make a difference

Don’t we all? Well, it sometimes gets harder to believe that you can have an impact as you progress in your career. It’s probably one of the biggest drivers behind disengagement and disenchantment among employees, as they start to see an increasing distance between what they do and what the original vision of the business once was. This desire to make an impact for customers is what drives many start ups – a clarity of vision and a clear practical motivation for every single person within the organisation. Take Forager – a US tech start up that believes it can make dramatic improvements to the way that customers can access local food products using online and mobile technology. It’s a business that the Forbes Technology Council says could radically reshape a very established industry – and you can bet that, at this early stage at least – everyone at Forager believes they really can do it too.

Recreating this kind of feeling in a more established company is tricky, but not impossible. So, make sure that you take every opportunity to re-emphasise the importance of the difference you can make together, and to show every individual employee how what they do contributes to this.

They are led with dynamism

Of course it takes all sorts of characters to lead a business – but one of the most common traits of those at the helm of successful start ups is charisma and energy. Relationships are vital in any business, but especially so for start ups. Jon Steinberg, the founder of Cheddar, a start up internet TV company, and former COO of Buzzfeed, is a great example of a leader who can network for the benefit of his business. His pitching abilities and the connections he built in the industry helped him to secure over $3 million of investment from Jeremy Liew, at venture capital firm Lightspeed Ventures. As leaders, it’s always worth reflecting on how we represent our companies to other people.

They understand how to grow, and to grow fast

Successful start ups are defined by rapid growth. They have a popular product that they sell to a large market, quickly. Their whole structure is built around making this rapid expansion possible – and it’s also what makes them so attractive to investors.

So, whether your business fits this model or not, understanding how and why start ups (particularly in the tech industry) are able to grow so rapidly is a useful lesson for every business. The fluid management structures and rapid innovation processes they have in place to help drive this kind of growth can have applications in other types of industries too.

Look at how the term ‘rapid prototyping’ has now moved from the engineering sector to the tech industry. Where it once meant creating test components using technology like 3D printing, it’s now being used by software companies to generate and test large quantities of new product ideas, gather insights from the results and then build this into their offering. These are organisations where people are used to working rapidly, failing fast and learning even more quickly to improve their offer.

The ones that fail forget the customer

An absolute fundamental of any new business is that there is a customer demand for whatever it is they’re producing. But it’s incredible how many start ups (particularly in the tech industry) start with the product, or the technology. They say: ‘I think that this new piece of software I’ve designed is incredible, so now I need to tell everyone about it and give them the chance to see how incredible it is too.’ Doing this completely ignores whether there is any demand for the idea in the first place – which can put a huge hole in any business plan.

A final thought, however: customers don’t always know what they want until they see it. Who knew that not actually watching scheduled TV programmes and instead paying monthly to stream it onto your phone would be the way forward, until Netflix showed us the light?

So, perhaps the final lesson from start ups has to be to forget everything that can go wrong, and be bold. Sometimes you really do just have to believe that you can make a difference, that you know how to run your company better than anyone else, and that customers are going to just love your product, even if they don’t know it yet.