Maintaining a successful and sustainable business is not only about having the brightest ideas nor having the largest amount of capital. It is also about execution, building the right team, giving the right solutions, and several other criteria that we believe make a company capable of surviving, scaling up, and eventually transforming itself into a unicorn. However, above all, there are four pivotal pillars that startup companies must have as their strengths to transform into unicorns.
It is the ability to create a business and the excellence in execution and delivery, which is the characteristic of the founders of the business. We believe that the founders’ credibility and integrity also play an essential role in the success of a business, bearing in mind that big businesses are built on reputation and track records. Founders should work hard—and more importantly, work smart—to maintain a good speed, momentum, and accuracy, as a business is always about timing and seizing the opportunities. Another trait that we think plays an essential role in being a notable entrepreneur is humility, the willingness to learn and continuously improve oneself.
When talking about a market-fit product, it means the degree to which a product or service can meet or satisfy the market demand as a solution to current market problems or challenges. It should not be something that is too visionary or long overdue; it should be a solution, the correct answer to fulfill the market needs.
Just having a brilliant idea for your business is not enough if the company does not have the capability to scale its business, increase profits as it grows with a business model that can be replicated successfully. Once a business has passed the economies of scale, it continues to soar. Scalability is what makes a business become a giant company in tech, we call it, a unicorn.
Startup companies should not always rely solely on their founding team. At one point, business processes and management systems must be institutionalized to ensure continuous growth and sustainability, removing its dependency on a certain individual only, but instead to be dependent on a reliable system and professional management.
What is next after unicorn
What comes after attaining the unicorn status is to make the right decisions and act timely to address the problems throughout the journey to scale up. One example from East Ventures’ own story or portfolio is Traveloka. In early 2020, as Covid-19 first arrived in Indonesia, Traveloka has prepared itself to face the pandemic head-on. As travel restrictions came into force, they decided to completely cut off their marketing expenses to zero, which happens to be their biggest spending as an online travel company. They took an even tougher choice to streamline their operation to be more efficient and adjust to the situations.
Despite going through an undoubtedly hard time during the pandemic, Traveloka continued to be resilient, and this success story was proven as they kept operations running. Once the issue had subdued, they eventually continued to expand and improve the company. Traveloka has become stronger and is cementing its position as a market leader.
Traveloka is just one perfect example of being agile and responding to an obstacle timely, from many others in East Ventures. As a venture capitalist, we are devoted to assisting these startups in identifying the problems while focusing on their core strengths, enabling them to reach their true potential and eventually become unicorns.
Looking forward, there will be a lot of business trends that might affect the birth of the newest startups in Indonesia. Nonetheless, transforming into a unicorn is not an impossible dream for these startups as long as they can meet the aforementioned standards and stay relevant.
David Fernando Audy is the operating partner at East Ventures