So you want to try your luck in startup consulting? I assume you’re an experienced individual who knows what to do and is well aware of the startup essentials. Or you could be a newbie with 3/4 years of market experience and is all pumped with thoughts of freedom, being your own boss, and earning chunks of money.
The latter part is the offshoot of startup consulting and holds to some extent. But only at surface level. The market of startup consulting is tough. Although it has good demand, its success assurance is uncertain.
Startups run on uncertainty with little resources at their disposal. Whereas startup consultants’ job differs in every niche. This is along with different rates at different locations and with varied outcomes. Given the challenging grounds of the startup, it is equally challenging for consultants.
A consultant is a savior for startups. Consultants analyze data, make reports, and provide key recommendations for improvements. They review the business model, monitor the goals, and suggest ways to increase the winning chances. A consultant’s decisions can make or break the business.
Here are some of the key areas where a consultant contributes to a startup & directs in business improvements.
Why Does a Startup Need a Consultant?
Expert Business Advice
Startups bring in consultants to gain expert advice. Consultants are highly considered as a master in their field with plenty of knowledge of the latest techniques for developing business growth opportunities.
They are expected to have managerial and business experience with the knowledge to steer the finance, marketing, and strategies in the right direction.
But if you’re someone who’s recently graduated from B-School, and have decided to follow the passion rather than working under someone else & is still learning to set the foot on the ground. Beware! Because thriving will be tough for you.
Most Startups begin their business with a loose roadmap and spluttered idea pieces with no clue of how to move forward in the right direction. A Startup consultant is expected to glue together those pieces and present a concrete business roadmap.
They support startups in taking strategic decisions that are critical in forming a business plan & to move the startup forward. With limited sources to run a startup, hiring a consulting company to do this is outside the budget.
Moreover, startups’ needs are different from a well-established business’s needs. Hence, independent consultants that cater to their needs & are easy on pockets are the best choice for these recent startups.
With careful planning and timely execution, consultants help achieve the best possible beginning and a pathway to run the startup.
A startup is an entrepreneur’s closest child. They love, cherish, and nurture their startup insanely. While this emotional bonding with a startup inspires one to move forward it can prove to be counterproductive.
This leads to an inability to assess the weaknesses and strengths, overlooking the flaws about the business, etc that could hamper the business.
So here comes the Startup Consultant to give founders a fresh and new perspective. An unbiased, and brutally truthful feedback that not only points out the loopholes but also provides a full-proof master plan to run the startup.
Market research is one of the crucial tools for strategic startup decisions in startup consulting. It gives close details about every dynamic of the industry. From assessing data about customer needs, tracking competitor’s abilities to monitoring ongoing trends of the industry.
A startup consultant is known for closely analyzing market trends and business developments. Consequently, enhancing the business performance, and increasing its revenue.
The minute investigation style of consultants proves beneficial in digging deeper into the business and will steer away the loopholes to protect it from damage.
Filling Up Gaps
As a startup consultant, you’ll be an extra pair of hands to relieve the founder from the heavy workload. Hiring too many additional staff or employees is less cost-effective than hiring a consultant.
Consultants do not require much of a comprehensive or hefty onboarding process. They just join in with their dozens of skills and knowledge that complement business towards success.
The temporary addition to the team has better contributions and serves a bigger agenda than increasing the employee roster list.
Challenges of Startup Consulting
By far you’ve understood the need for Startup consulting and how it can be a good business market. Nevertheless, you should also fully know the challenges before you just step into startup consulting.
Founder’s Unrealistic Expectations
The first thing that hits in a startup consultant is the load of accomplishing unrealistic expectations of founders. They want to squeeze every grain of the consultant’s skills. No matter how messed up the things could be. They’ll expect you to solve their deepest and darkest problems.
As they hire and invest a good sum in you, your recommendations cannot just be a handy to-do task report. They stake a startup’s future based on what you guide them.
You give out the strategy, work for the decided duration and send the project off. But startups fluctuate so rapidly, that your outdated document is no longer of use to them. Consequently, while preferring startup consulting, founders expect consultants to return and recover from the unfulfilled claims without the extra cost.
Fewer Brains, More hands
Startup consulting generally revolves around recommending new strategies & handing in new ideas to implement them. But you cannot be just another consultant who offers yet another flawless and high-level strategy.
“Most of what you will get will likely be a lot of industry jargon and fluff without a lot of actual content that will be useful to you. Consultants are extremely good at making them sound useful but usually not quite as good as delivering. Unless the skies the exception to the case it’s going to be a waste of your time”
Founders have already crossed the first two levels of creating strategies, & having enough brains to give out ideas. Hiring another person to add to the idea backlog is of no use to them.
Startup founders don’t need a consultant who tells them what to do, a well-experienced one knows what they are doing. Instead, they want someone to get on the ground and make their hands dirty for the actual execution.
Lack of Same Passion
Founders perceive that a consultant cannot be as passionate as they are. You cannot share the same dedication and vision as they have for the startup. No matter how specific the industry or niche is, there are high chances of not matching the same zeal as founders to achieve startup success.
Startup Consultants have a superficial view of the business, Thus, the doubt of trusting startup decisions in the hands of a startup consulting lingers in the founder’s mind. Unfortunately creating hesitation in following the consultant’s decision.
OverGeneralisation of Expertise
So you’ve good knowledge, skills, and experience. You are a noted expert in the industry. But every consultant despite their depths of work and skill is bound to fall prey to the same biases & overgeneralize their experience.
You’ve successfully worked in a few startups & believe your strategies will make it in the other startup firms as well. The overgeneralization proves toxic because what worked in your previously successful startups 5 years back will not possibly work today.
This restricts startup consultants in their past decisions, leading to a lack of newness & experimenting in their recent inputs.
Democratization of Knowledge
The rise of the internet and digitization led to a widespread increase in knowledge democratization. Internet is omnipresent, at work, at the campus, and even in the entire city.
Googling out queries has become the new way to sort things out. Access to facts, ideas, models, templates, and essential tools is so easy, nothing can be kept secret.
The strategic knowledge that a consultant has is now so easily available on the internet, that the competitive advantage a startup consultant could have is now wiped off.
Can You Become a Startup Consultant?
There are numerous consultants in the market some are bad that force clients to abort the project midway if it costs them hefty efforts or time. Whereas only a few are good ones that work hard & deliver exceptional value to their clients.
Additionally, there are other forms of consultants as well. The one who performs trend analysis and just gives recommendations. And the other one, that walks and sits with you to guide you for the next marketing strategy.
So for which one are you aiming for?
Above everything, to be a successful consultant, the foremost thing is to build up your competency level, gain authority, experience, and some strong credentials.
The consultants with a strong experience background have an easy pathway to strive in this field. Rather than one who’s just out with an MBA degree.
“Never ever ever hire a consultant who hasn’t ran multiple startups. Run away from the person who says, ‘I never had a startup but I ran divisions of this large company like a startup.’ Know that a business degree isn’t enough. Hiring a consultant who has never had a startup is like taking parenting advice from someone who has never had a kid.”
As you step in, focus on a single field or niche where you’re confident to gain monetary value from a startup. Brush up the required skills and knowledge. An ideal consultant is good at leadership, interpersonal, and negotiation skills.
Build a strong skill set of creativity, problem-solving, and decision-making. This will make you ready to face startup problems in the future.
To make startup consulting a lucrative career, find those startups that have enough money to afford a consultant. Startups that have surpassed Series B & Series C rounds are a good choice initially.
It is always better to have a handful of people that love your services rather than many who are doubtful about it. Be a go-getter and work with optimism and persistence to ensure success.
To Wrap Up
The bottom line is startup consulting is a tough business. The more recent the company is, the more difficult it gets to make a financially viable business.
Filtering startups would be a good decision. But the reality kicks when you start working with the founder and get to know their business.
Strive to be a professional consultant that naturally fits any startup requirement. Be someone who not only helps in doing business but also increases the worth of the startups.
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