Momentum: The secret to a startup's success

From strategic planning to successful execution - Entreprenrial insights #7

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Launching a startup is a bit like trying to launch a rocket. Picture a rocket during the first two seconds after ignition. There's a lot of noise, a lot of smoke, and a lot of effort, yet it doesn't move much! Momentum, or the impetus, is crucial to the success of a nascent company. It determines the startup's impact on various levels, such as visibility, attractiveness, and opportunities. In this article, we explain how to create and maintain favourable momentum using a Master Plan and a virtuous circle, while sharing some concrete examples to illustrate each part.

The importance of momentum

Momentum refers to the force with which a project is formed and the energy it generates. It determines the potential success of your startup, which can range from complete failure to creating a unicorn, or even beyond if you can! Strong momentum contributes to your company's notoriety, attracting media attention, customers, and investors. It also makes your company more attractive to potential talent and customers, who will be more inclined to join your team or do business with you. Finally, favourable momentum facilitates access to new opportunities, whether in terms of media coverage, partnerships, or funding.

Creating favourable momentum: The secret sauce? The Master Plan!

The Master Plan is a long-term planning method that involves defining the main milestones to be reached over a 3-year period. It should include key elements such as minimum viable product (MVP) development, funding, and acquiring the first customers. The Master Plan is developed retrospectively, starting from the goals to be achieved in 3 years to determine the actions to be implemented today. This allows for anticipating and organising the necessary resources to meet the commitments made. By meticulously planning the steps over a relatively long period for a startup and rigorously aligning execution, the Master Plan creates strong momentum that facilitates the company's take-off. For example, startups such as Beamap and RecastAI successfully followed this method, implementing a solid Master Plan and updating it at least every six months. On the other hand, Ponicode encountered difficulties, partly due to the departure of senior founders (who dreamed of being entrepreneurs but were not ready for the associated sacrifices) and the impact of the Covid-19 pandemic.

Example of a Master Plan Creating favourable momentum:

The Master Plan for AutoAi

Year 3 - Long-term objectives

1. International expansion and partnerships with car manufacturers
2. Launch of version 3.0 of the autonomous driving software, including advanced features based on artificial intelligence
3. Reach an annual turnover of 4 million euros
4. Obtain a Series A funding of 25 million euros
5. Be recognised as a leader in the autonomous electric vehicle sector in the market
6. The team consists of more than 50 people
7. At least 3 major car manufacturers have signed a long-term partnership with AutoAi
8. The Series A is celebrated in style! The team chooses how!

Year 2 - Intermediate milestones

1. Establish a presence in 3 additional countries, surpassing 10 clients
2. Launch version 2.0 of the autonomous driving software with improvements based on customer feedback
3. Strengthen the team by hiring automotive engineering and artificial intelligence experts
4. Reach an annual turnover of 1 million euros
5. The team consists of more than 25 people
6. At least one off-site every six months with the entire team to step back

Year 1 - First steps

1. Develop and launch the MVP - Minimum Viable Product - to test the market
2. Acquire the first five customers and gather their feedback to improve the software after the MVP test
3. Obtain seed funding of 3 million euros 4. Establish partnerships with car manufacturers and universities to validate the effectiveness of the MVP
4. The core team is formed, consisting of approximately 15 people
5. At least 1 social gathering per month ;)

By adapting their objectives and following this more realistic roadmap, AutoAi can create favourable momentum while enjoying healthier and more sustainable growth. Having a vision of the next steps allows you to better align your execution to steer the company in the right direction and, more importantly, with much greater force than linear execution.

The virtuous circle of momentum

When your company benefits from favourable momentum, the media are more likely to notice and talk about you, which helps strengthen your notoriety and attract new clients or partners. For example, the increased media coverage of RecastAi following the podium finish at the first edition of VivaTech during its launch contributed to its growth. Positive momentum also makes your company more attractive to potential candidates, who will be more inclined to apply to your company rather than your competitors.

Momentum and the visibility associated with your company give clients confidence to try a first project with you, which can lead to fruitful and lasting collaborations. For example, the startup Beamap benefited from significant momentum by signing 25% of the CAC 40 within less than 2 years, which encouraged many prospects to approach them and thus accelerated growth even further.

Investments in the early stages of a startup carry high risks. Solid momentum can help convince investors of your project's viability and gain their trust. For example, the momentum of RecastAi, after visibility at Vivatech, revealed us to many investors who were, from then on, more interested in investing.

But! There is always a but! Momentum does not replace hard work

Despite the importance of momentum, it cannot replace hard work and the fulfilment of promises made. To ensure the company's sustainability, it is crucial to deliver the expected results and honour commitments made. This is primarily a matter of credibility. Momentum should not be confused with a simple marketing campaign either. While marketing can certainly help strengthen momentum, it does not guarantee long-term success. The project's fundamentals and the effort put in by the team are equally important. Aim for the essentials: Existing technology, a used product, and sales!

In summary, momentum is a determining factor for successfully launching a startup. By developing a solid Master Plan and establishing a virtuous circle, entrepreneurs can maximise their impact for their startup's launch. However, it is important not to confuse momentum with marketing: Hard work and the fulfilment of promises made are essential to ensure the company's sustainability. Thus, by combining strong momentum with sustained effort, startups can significantly increase their chances of success.

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