Hotels.ng Founder, Mark Essien, shares what you should know to build and run a successful startup

One thing is clear, the Nigerian startup
ecosystem (tech and otherwise) is burgeoning exponentially and incubators are having their hands full already. As the number of athletes in
the race called entrepreneurship surges, so does the number of deaths. People/Teams crashing out, dropping of the picture for different
reasons. Many drop their blame on lack of funds. That’s what they all say but the truth is, the reasons are far graver than non-availability of funds. Many a startup have secured mouthwatering grants only to spiral down oblivion years after.

Hotels.ng’s Mark Essien bares his thoughts on what really works in building a successful startup that would really last and survive. I couldn’t help but agree with him. His pragmatic ideas are convincing enough.

Here are his views:

WHAT DOES NOT WORK?

First of all – let’s look at what does not work. Giving kids fresh out of African colleges 20k USD to found a ‘startup’ has not worked so far. There
are a very few isolated cases it has worked, but often there were other factors at play.

To quote P.T Barnum in his Art of Money Making (1880) – “Give a boy twenty thousand dollars and put him in business, and the chances are that he
will lose every dollar of it before he is a year older.”
The various competitions, incubators, grants, etc have proven this time and time again – it does not work. It does not even make logical sense: If you give a small amount of money to someone
with zero experience, working in a really hard market, and with little interaction with other successful founders, the chances of him creating a big business are just bad.

WHAT DO I THINK WORKS?

The core of my idea on what I think works came from Justin, who runs marketing at Hotels.ng – I
paraphrase: People don’t realise how much they need to know to run a startup. Most founders should work for 5 years at a startup before starting one.
To me, that’s the secret – startups will be found by the management level of other startups. Far more successful startups have been created through other startups than through incubators – either by founders funding other startups (like in Hotels.ng case, which was funded by Jason/ Bastian from IrokoTV) or by founders leaving
startups to create their own (e.g Supermart, ACE, TravelBeta, etc).
For any agency that is on a mission to create startups that actually employ people, I think it is a better idea to invest in improving the management level of existing startups. E.g let’s say you pick a startup like Hotels.ng, and instead of giving us money or focusing on
the founder, you focus on the top 7 management staff. You invest in them, growing their capability and exposure.  This grows the company, Hotels.ng as a startup. That means Hotels.ng employs more people, becomes bigger etc (because it now has better people). Those 7 people, after working at Hotels.ng for let’s say 5 years, would move on to new roles. They can
either go to another startup, bringing experience and talent, thereby growing it (and making it employ more people), or they can create their own startups.
When they create their own startup, they
actually know what they are doing. They have worked in the environment, they know how to manage, they are highly skilled, and they are experienced.
So their startups will be far better, and far more likely to succeed.

CONCLUSION

The above method is much slower than giving $10k to competition winning startups, but it builds a much stronger fundamental for the startup economy because it creates a big network of highly skilled people. And to build an entrepreneurship eco-system, that’s what you really need.

Three ways you may be burying your small business and not even know

If you’re an outsider looking in, it’s easy to think
running a startup is a good retirement plan.
Pursue your passion, be featured on tech
websites and magazines every other month, get
millions of dollars in VC money, throw crazy
parties, have weird looking offices – the list goes
on. But you’d be wrong.
As much as startups are all the rage nowadays,
running one will probably run your blood
pressure up (and keep it there). It is a grueling
endeavour especially as you’re trying to beat the
odds and keep the doors open. Little wonder, a
lot of founders have two to three failed startups
under their belt. Startup mortality rate is not
what you want to look at first thing in the
morning.
Which begs the question, why do startups fail?
Well, sometimes, it’s the little things, the subtle
things. Things you may already be doing and not
even know.
Here are three of them:

1. Running out of money
Contrary to popular belief, the number one
reason startups fail is not lack of money. It’s
mismanagement of available funds. Lacking the
foresight to see and obtain the capital
requirements for your business, will sink your
startup faster than you can say, Iceberg!
Foresight involves a lot of calculation. You’ll
need to consider not just the funds available to
start but also, the funds required to run your
daily operations as well as your frugality skills
(if you’re bootstrapping). Projecting accurate
burn rates positions you to be a better manager
of your business.

2. Under-utilising Social Media
A lot of big enterprises treat social media as an
afterthought. They can afford to, because they
probably have a solid customer base and an ad
budget to rival some country’s GDP. Small
businesses on the other hand, don’t have that
luxury. Social media is your one way ticket to
affordable and sustainable customer acquisition.
Social media growth hacking is all the rage these
days. Rapidly acquiring real users (not “buying”
followers or fans), will Jump Start your revenue
base like an adrenaline shot.
Learn how to use social media like a whiz. The
web is overloaded with valuable info, most of
them free. If you don’t have the time, hire an
expert. Whatever you do, don’t drop the ball on
social media.

3. Letting your USP get lost in the noise
Today, more than ever, it is difficult to get
yourself noticed (unless you have that
juggernaut-like ad budget talked about earlier).
That’s why small businesses have to differentiate
themselves in the marketplace. Your product
can’t afford to be just another run of the mill
clone. Something about your business has to
stand out. It could be your customer service, it
could be your delivery time, it could be your
product. Something about your business has to
be compelling enough to generate not only
repeat customers but also viral word of mouth.
It’s the lifeline to growing your customer base
without running your account into the red.
You want to turn up the volume on your USP. As
loud as you can. Because, if you are doing
something right, your competition will notice
you and will try to outbid you for customers. So,
it’s good to let customers know what your
product is offering them, which is exclusive to
you.