Getting a modern business off the ground, in and of itself, is an accomplishment, but that’s just the first stage in an infinitely evolving business world. Why do so many businesses fold prematurely, failing to grow beyond the initial stage? The issue is often because entrepreneurs are busy tackling daily operational tasks and overlooking key success factors to manage a profitable business.
Startups and SMEs (small and medium-sized Modern Business) may look similar to the uninitiated. Both are small companies built by an entrepreneur to fill a market gap. Both are focused on growth, profitability, and survival. Maintaining and transforming a startup/SME into a large business is a mountain that only so few have successfully scaled. Finding a good corporate finance solution and having the right knowledge to withstand the volatile economy are keys to making a business survive and even thrive.
The global startup economy is worth over $3.8 trillion in Ecosystem Value, more than the individual GDP of most G7 economies, not including the value of exits before 2018. Based on the Singapore Department of Statistics report, the country’s SMEs are responsible for about two-thirds of employment, constitute 99 percent of all enterprises and provide just short of $148 billion ($200 billion) to the economy – which is nearly half of the country’s gross domestic product).
The top 10 risks for Singapore SMEs include:
- Failure to innovate/meet customer needs
- Damage to reputation/brand
- Increasing competition
- Economic slowdown/slow recovery
- Cash flow/liquidity risk
- Major project failure
- Workforce shortage
- Corporate governance/Compliance burden
- Loss of intellectual property/data
Apple, FedEx, Evernote, Airbnb, KFC, Reddit, and other large businesses were at one time struggling in their startups, and their stories will tell you the certain strategies you must utilize to reach your goal. Here are the most important ingredients analyzed from the State of Global Startup Economy report.
Great ideas equal great Modern Business
Great ideas naturally turn into a great Modern Business. Instead of features, think of platforms. Instead of wisdom, go for widgets or painkillers over vitamins. At the heart of a business is its product or service. This is the key to persuading people to give you their hard-earned money. Behind all products or services ever sold was a great idea.
Any business is only as good as the people working behind it. Its workforce will dictate the success of the Modern Business. Effective leaders know how to maintain the talent required to get to the next level. Talent is believed to be the asset required to create a unique advantage that competitors can’t duplicate.
Customers drive revenues, and revenues are what impress investors. Investors fund business growth and growth leads to big exits, ultimately leading to a robust ecosystem. It starts with existing networks. Startups should waive ads and focus on great content through blogs. Blogs generate needs that lead to demand and traffic to your site.
Access to financing
A lack of capital is a key challenge for Singapore SMEs to adapt and innovate. Without access to capital to fund a business, the best ideas and talent are useless. Businesses need to find a corporate finance provider with a local presence and streamlined process to finance solutions for business goals. Aon’s study found that more than 60 percent of SMEs seek external financing via bank loans to aid cash flow financing and realize their growth plans.
The next steps
There are many successful Modern Business worldwide that almost failed at some point. The majority of successful businesses have probably thought of giving up amidst challenges.
Leveraging existing resources, having a deep knowledge of evolving risks, and acting promptly to mitigate them can make or break business ventures. As SMEs look to grow and be more successful, they need to find the right corporate finance solution provider to update their business as they play an increasingly crucial role in the new global economy.