From Small Idea to Start-up: Tips from Successful Tech Companies

A million dollars in the tech world may seem like small change against giants like Microsoft (valued at $1 trillion) or Apple (valued at $1.3 Trillion), but for many start-ups, a $1 million company valuation is a sign that they’ve made it. Today, on National Be a Millionaire Day, we review companies that found their niche in an incredibly saturated tech market to make their mark-and their million. 

Inc.com reviewed companies that began as small ideas before turning into the giants we know today like Twitter, Groupon, and Instagram (which began as an app to find the best nearby whiskey)₁.  

The first company on the list, ProductHunt, was founded by Ryan Hoover. Hoover didn’t have the engineering background to physically build his platform which assists users in finding new technology, so he focused on managing a team to create what he couldn’t by himself₁.  

"I wasn't an engineer, so I wasn't going to invest the time or money in building an entire site from the start, but I could build an email list really easily. I started one and invited a few dozen investors, founders, and other friends of mine who I thought might like this, and who had an inside track of what kind of tech products were cool.₁" 

While Hoover was forced to focus on the big picture of his company due to his lack of technical skills, the article posits that this may be a move even skilled engineers may want to make to best “[utilize] your own limited time resources.₁” 

If hands-off doesn’t sound like your dream, AppSumo may be a more applicable example that all millionaires may be valued equally, but they are not created equally. Founder of AppSumo, Noah Kagan, realized the need for a website that aggregated online deals while working at Mint.com₁. Kagan began his company with only $50 worth of funding and created the web platform himself which was valued at $1 million in the first year₁. 

Yet another company that used technology to become unbelievably successful is Oculus, a virtual reality headset manufacturer. Palmer Luckey, founder of Oculus, worked on his product after his day job and raised money from strangers on Kickstarter to start his company that was eventually bought by Facebook for $2 billion₁. 

These companies (and these founders) all employed different strategies to create their “big idea”, raise funds, and acquire users, but they did have a few common qualities that may help future tech entrepreneurs make their million(s). 

The first commonality pointed out in the Inc.com article centers around each founder identifying and creating a product to solve a problem they faced themselves₁.  

"The best way to come up with startup ideas is to ask yourself the question: What do you wish someone would make for you?" Y Combinator founder and entrepreneur Paul Graham wrote back in 2010₁. 

The second common thread is that the founders were able to pivot their product, which they created to satisfy their own needs, into the marketplace to satisfy consumers’ needs. For example, “when Twitch first started out, the gaming community was never high on their list of priorities. But when they started to see more and more people livestreaming games on the site, they knew that's what the people wanted₁.” 

The next commonality found between many self-made millionaires can be a double-edged sword. The founders of the companies mentioned here and on the full list from Inc.com, took on more than they reasonably expected they could handle. While taking on more than you think you can handle can have big payoffs, it can also come at a big expense₁. To balance this out, take input from your users, or potential users, to heart just as much as you would a colleague or peer.  

The last tip, and perhaps the most important when starting any business, is that timing matters ₁.  

One example is the aforementioned “Oculus, which leveraged people's imagination as well as updates in technology to build a new way of experiencing content and re-launched an entire industry.₁” 

If you have an idea that fulfills a need or solves a problem you have, chances are someone else is facing that same void or issue. While that is a great foundation to begin any entrepreneurial adventure, make sure you give yourself all possible advantages by remaining flexible in your vision, believing in your capabilities, listening to your prospective audience, and understanding the current market to ensure your product launches when it will be most appreciated. 

References:

1. Haden, J. (2017, November 16). 21 Side Projects That Became Million-Dollar Startups (and How Yours Can Too). Retrieved from https://www.inc.com/jeff-haden/21-side-projects-that-became-million-dollar-startups-and-how-yours-can-too.html.