We had a conversation with our Managing Partner Nguyen Minh Phuc on the challenges facing a startup and overcoming them. With a wealth of experience from working with startups in accelerator programs, he has plenty of interesting insights you could learn from!
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A factor that I think many investors look at first is the founder. When a startup is in its earliest stages, seed or pre-seed, not much information is available to evaluate it, so the one thing that could inspire faith in its potential is the human factor.
Personally, I usually look for 3 characteristics in a founder’s personality: integrity, kindness and commitment. They should be someone who is passionate about bringing positive social impacts through their products. I also consider their skills and expertise. From my point of view, there are no successful founders that are not highly competent in their field. They also need to have leadership skills, which shows in their ability to listen and receive feedback, as well as their business acumen, people skills and how they inspire others around them.
Another often forgotten thing I believe is important is the problem-solution fit. Although most of the time people talk about product-market fit, without a proper understanding of the customers’ problems and a matching solution, any product would have a hard time succeeding.
A final and perhaps most important to me is a sense of cash management. A founder needs to balance between making money and creating value. They cannot chase their passion for the product without being mindful of the cashflow, but on the other hand, they also cannot sacrifice customer value in favor of profits.
The first thing, which is probably a little cliché, is that “truth hurts”. From the first steps they take, founders face criticisms everywhere, and it is very difficult to have a product you are proud and passionate about receive no enthusiasm from the market. That’s why it’s vital for startup founders to learn early on how to deal with criticisms and failures.
A second challenge that not many people realize is how to keep their mindset open to take their venture far, but still remain pragmatic enough so as not to overstretch their wallets. A fundamental question that I think founders need to be mindful of early on, is how to deal with money matters without letting it weigh down their passion and creativity. This balance will also allow the founder to realize when they should move on from a failed venture.
Furthermore, during this particular period of uncertainty, it is essential that practicality takes center stage. The founder needs to pay close attention to metrics that reflects the survival of the startup, and allow creativity to stay out of the limelight temporarily.
First and most accessible is the available internet resources. There are plenty of blogs, online courses and books about startups that anyone could enjoy, but not everyone has the discipline to push themselves to it. Vietnamese startups are already disadvantaged compared to other countries as they do not have early access entrepreneurial skills and knowledge. As such, the vital thing in every founders’ and startups’ growth journey is the effort to learn and make use of available knowledge banks.
Another resource I think many founders miss out on is incubator or accelerator programs. Many people come to these organizations looking for chances to meet investors and pitch their ideas, undermining other valuable benefits these programs offer, like training regimes or mentorship networks. Although these programs are few and far between in Vietnam, there is a lot to take from these organizations if we take them more seriously.
Finally, I believe startups should be learning more from successful business people in Vietnam. Many people have succeeded in traditional businesses and their wealth of experience is invaluable to inexperienced entrepreneurs. I believe founders should have a constant learning mindset, as the insights that are helpful to them are not limited only in the startup community.
Join Emakase this January in our workshop to learn more about startup ideas!
