With Christmas time coming up- it’s easy to just focus on the task ahead. But it’s also important to make sure your business is future-proofed.
Dynamic Business asked founders what their businesses are doing to make sure they are future proof.
Jake Colvin, Co-Founder, Director of International Operations, Owlet Baby Care:
The best method for future-proofing your business is to create gold standard products or services that meet the needs of your target audience. At Owlet, we’ve spent tens of thousands of hours researching, developing and testing products with new and expecting parents to ensure our offering delivers more than our competitors.
Speak with your customer community and understand what they care about now and anticipate what their needs will be in a few years. Above all, listen to feedback. Ask what your customers would improve about your product and then align their suggestions with third-party research results (i.e. your Net Promoter Score) to prioritise the list of actions. By continuously learning, iterating and watching for market opportunities you’ll be in a greater position to ensure business longevity.
Sam Allert, Chief Executive Officer, Reckon Australia:
“Your business needs money to survive. As such, steady cash flow should be the first move to improve resilience. Regular cashflow forecasts are important to keep track of what is going in and out, and it’s particularly important to leave room for late payments or unexpected repairs. Even if your business is profitable, a lack of cash in the bank can cause problems.
Tracking physical cash is particularly difficult, meaning digital payments are the best option where possible. Online tools can be used to automatically record financial activity, making it much easier to forecast goals and identify financial challenges before they exacerbate.
Resilience also relies on adaptability. Cloud tools are a great option for growing businesses, as users can benefit from a pay-as-you-go model. When it is time to expand, cloud subscriptions can be grown in tandem with the pace of the business or dialled down during more challenging periods.”
Dr Aron D’Souza, Founder and Managing Director, Sargon:
Future-proofing a business requires looking at the future in a very different way. It’s not as much about what might happen in the next five years, but rather the next twenty to fifty years. So, a truly future-proofed strategy prepares companies to disrupt themselves, before others disrupt them.
Our business, Sargon, is disrupting an industry whose incumbents are more than a century old. We have developed defensible competitive advantages and allocated capital to innovation. It has required us to think, and act, like entrepreneurs.
Disruption does not happen overnight. Amazon planned and executed their strategy for twenty years before its power to disrupt truly came to the fore. Salesforce, AirBnB and Netflix have similar stories to tell.
‘Creative destruction’ is the true motor of capitalism. Companies must look through the uncertainty, towards the far future, with plans that recreate themselves to continually drive the process of value creation.
Yanir Yakutiel, CEO, Lumi:
Ensuring business longevity and sustainability demands a long term approach and making sure that we are never too settled on our laurels, particularly given the increasingly saturated nature of the small business lending market here in Australia. Clayton Christensen coined the term ‘disruptive innovation’ back in the 1990s and he used it to describe the emergence of a unique technology which allows a whole new population of consumers at the bottom of a market access to a product or service that was historically only accessible to consumers with a lot of money or a lot of skill. This resonates strongly with our core team philosophy in bringing to market a compelling and sophisticated lending solution for small business owners. At Lumi, we are constantly looking at how we can disrupt the landscape for small business lending in Australia and our customer-first approach combined with our intelligent credit-decisioning means we are able to provide fast and secure loans quicker and more effectively. By continuing to invest in our platform and team, we are driving an ambitious growth strategy that will see us continue to grow and thrive in the next five years.
Stuart Craig, Chief Executive Officer, Asia Pacific, Crestron:
Whether you’re in IT or interior design, the key thing to making sure your business remains relevant is ensuring you’re always ahead of the customer’s needs.
At Crestron, we have made it our mission to help our customers stay ahead of the curve. Being solution orientated and offering bespoke solutions is key to ensuring our business is around in the next five years.
Staying in touch with what our customers want is important, but it is also vital that we keep an eye on the future. Our role as a tech leader is to make sure that we are anticipating the needs of our customers, then setting and creating both the trends and technology that will be the norm in most businesses and homes within the next few years.
Looking forward, we anticipate a wealth of changes lead by IoT innovation, big data analytics and Artificial Intelligence to keep challenging us and our customers, as we all look for greater efficiencies and collaboration at work and at home. Our dedicated research and development team is constantly listening to customer feedback and exploring market forecasts to evolve our technology offerings and help keep us one step ahead.
We are also actively identifying opportunities to offer our services to new vertical markets and working with our extensive technology partners to broaden our channel and customer pipelines.
Sabri Suby, founder and Head of Growth at King Kong, King Kong:
My business, King Kong, is in a service based business, so a lot of our business strategy is ‘team’. To future-proof we make sure we have a great team and that we always have a core of potential candidates. The first part of that is providing a really good workplace for our team to work, making sure it is a really good environment. Also upskilling them and teaching them more than any of our competitors are willing to do.That reputation gets out there – it’s a small circle. We take groups of people with no or intermediate knowledge and put them through our online training at King Kong academy –to turn them into seasoned marketers. That allows us to future-proof the business in terms of always having a highly skilled team to be able to carry out the work and have the ‘King Kong way’ embedded in the way they carry out tasks.
George Lucas, CEO, Raiz Invest:
As a mobile-first platform in financial services, Raiz Invest is subject to competitor growth in the industry, changes due to regulations and technology. Our commitment to our customers is to improve their financially confident enough which guides our internal strategy, but also financially conscious, to ensure they understand the value of investing in their future.
Over the next five years we expect that users will interact more via voice with Raiz, through Google Home, Alexa or Siri than just through the app. The intelligent chatbot we released in September is the first step to delivering the services of Raiz via voice as well as through the app.
We also expect that recent changes in regulation will make it difficult for our clients to source affordable financial advice. We will listen to our customers so that we can integrate their advice needs into the Raiz platform over time.
Delivering financial services and products in innovative ways that improves their financial position is the key to our future success. We are in a continued process of taking all our learnings over the recent years and combining them into the apps to improve and personalise the user experience. Our ultimate endeavour is to help all users achieve their financial goals, learn more about their personal finances and eradicate the misconception that finance is an obstacle to overcome.
Justin Cannon, co-founder and CEO, Cooperate:
As a founding team, our perspective has always been to try and move away from the concept of being a startup to being a business.
The Steve Blank definition of a startup is: ‘a temporary organization used to search for a repeatable and scalable business model.’ Depending on how innovative your product, service and business model is will depend on how long you are in this discovery phase or startup phase and whether you ever come out of it.
Startups that find their way through to product-market fit in a repeatable way go through a transition phase where they straddle between being a startup to being a business. This is a very tricky phase, as they both require very different skill sets, strategies and cultural orientation.
Once you have a repeatable model and are operating as a business, part of the challenge- depending on how fast you are growing and the inherent capital requirements-of building a business in your category is that you may still need capital.
At Cooperate, the number one thing we do to ensure we will be around in five years is to be crystal clear about our capital needs by forecasting both conservative and stretch goals in our profit and loss (P&L) forecasts and then above all things, make sure we have a plan to get the working capital we need to move the business forward.
The amount of working capital needed can be influenced by adjusting multiple levers NOT just who can we raise capital from at what valuation. In fact, that is an option of last resort for us.
For a start, we look at keeping our operating costs as low as humanly possible whilst still growing at a reasonable rate. We then see if we can generate profitable services revenue on top of our subscriptions revenue and look to get paid early by our customers wherever possible. After we have controlled all of our controllables, we then look at what the shortfall in required working capital might be to grow at the rate we want or need to and then consider taking outside capital and the dilution to all existing shareholders’ equity that will come with it.
Fortunately for Cooperate we have been able to adjust the levers we can control to a point which means right at this moment we don’t have a need for outside capital to grow at the rate we need, however it doesn’t mean that at some point the founding team and board might look to escalate the growth of the business at a pace that outstrips our capacity to self-fund.
Being very clear about the role capital plays in our business and our options around that is what we are doing to be around in five years.
Tim Bos, co-founder and CEO, ShareRing:
The sharing and rental economies are expected to grow to $670 billion by 2025, positioning ShareRing nicely within a proven and lucrative global market. We are at the forefront of blockchain technology adoption within this fast-moving marketplace, as one of the few businesses implementing such highly sophisticated tech in a way that works seamlessly for all, including the less tech saavy. This makes ShareRing’s unique value proposition (UVP) our brand’s strongest asset, now and long into the future.
Hugh Stephens, founder and CEO of Sked Social:
We are doing the same things as always-listening to our customers and building upon their feedback. We are investing heavily in user research and collaborating with our customers in order to stay alert to changes in the landscape. In order to stay relevant, making sure our audience is part of every major decision we make is fundamental.