7 Competitive Advantages of Startups

Leaving the position of Managing Director at a company with over 40 employees for a startup felt like a setback. But Larry Alton mentioned “5 competitive advantages startups have over big businesses” and here are 7 of my own.

1. Agility

Startups can adapt to changes in market conditions and disruptive technologies in a responsive manner. Unlike their bigger and more established competitors, who are burdened with vested interest, a historic path and a culture that resists change. Startups have innovation in their DNA and can change their business models, processes and portfolio virtually overnight.

2. Personalization

Would you rather be a statistic in the books of a large organization or the number one customer of a startup that takes times and effort to understand your business, offers tailor-made products and services and goes out of its way to keep you happy? In my former job, I needed a compelling reason to visit customers, but in my new position I am lost without you!

3. Lean and Mean

Startups have lower administrative overheads and offer their services in an efficient, cost-effective and competitive manner. They are likely to be aware of their limitations and tend to focus on their core strengths. Startups easily recognize the benefits of partnering with other like-minded organizations to present the customer with an equal or superior value proposition.

4. Team Culture

Employees of large corporations are attracted and retained by prestige and big salaries. They easily lose sight of the company’s vision, mission and values and the success of its customers. Startup employees on the other hand form a close-knit community that shares passion, beliefs and values. They must work together for the good of the company, its customers and the world at large.

5. Versatility

It’s common that employees of startups multi-task and the person making the sale could become the relationship manager during the implementation phase. This builds trust with the client and offers a guarantee for successful delivery and implementation. The versatility of startup employees is reinforced by a team culture that encourages learning and innovation.

6. Flexibility

Your organization could have rather unique needs and demands for products and services. Such needs and demands might not be met by large and established service providers that operate in a rigid manner that suits them. Startups on the other hand operate with great flexibility and are more likely to work at the hours, the place and in the manner that suits you.

7. Fun

Last but now least, working with a startup is going to be a lot more fun. A startup only needs a handful of clients, so they pick you because they like to work with you, not because they must work with you. Believe it or not, working can and must be fun, and don’t you think that I can afford to take a handful of customers for kite-surfing at the coast or on a camping trip to the Aberdares?

In all fairness, it will take considerable effort to realize and sustain these competitive advantages. Nevertheless, startups can use them to choose their unique and compelling value proposition in an increasingly competitive world. What are your thoughts?

About Author:

Willy Simons came to Kenya from The Netherlands in 1994. He is a serial entrepreneur and co-founder of Oakar Services, Esri Eastern Africa and Spatiality. He blogs about business, geospatial technology and cloud computing.