Why start-ups and SME’s need feedback
SoftPotential Limited is a specialised Irish software house based at The Digital Hub campus in Dublin city.
We develop software specifically in the Healthcare and Financial Services markets and currently work on projects in the UK, Ireland, France and Spain. In this article, Ciarán Doyle, Director of SoftPotential Ltd., writes about the importance of giving feedback to start-ups and SMEs so they can learn from failures quickly and succeed in business.
Why start-ups and SME’s need feedback
Unless you have been involved in a start-up or SME, it is very hard to describe the challenges that you face on a day-to-day basis. Areas that are taken for granted in large mature organisations become a daily chore that can suck you dry of energy and enthusiasm, signing up new customers, cash collection and cash flow, maintaining the relevance and innovation.
External funding can be a major part of the success story and we are fortunate to have many sources available that ease the boot-strapping pain. There is a range of public funding options available from state organisations to EU bodies but it is a competitive process so not all succeed. Failure is a part of the start-up process, some see it as a badge of honour, others see is as a warning signal. What is clear is that start-ups fail in many ways and how we learn from this failure is what makes us stronger and gives us the impetus to succeed. This is like a mantra you would hear in Silicon Valley and it should be more prevalent in Europe, however I think that we are still early on the path. We need to improve the learning process.
State organisations and EU bodies have a huge role to play in this. Entrepreneurs are committed and focused and are serial by their nature. They are hungry to learn and develop and need support in doing this. In applying for public or private funding, entrepreneurs spend a lot of time engaging in the process which can be a distraction from the day to day work. They see this time as an investment in the process because it’s all part of the learning experience. The application methodology, the form filling, the pitching videos are all seen as a learning experience enabling the entrepreneur to get an even more intimate knowledge of his company from external questioning and challenging. Engagement in the process can enable them to address areas they had never thought of and answer questions that had never been asked of them before. In short there are huge learning opportunities available through engaging in the process.
The involvement of State bodies and EU organisations has to be applauded but there is room for improvement. Their remit is to support and develop the companies of the future recognising that some will fail. However out of this failure, just like the phoenix, new start-ups will be born. They have an obligation and in some places a legal requirement to give the feedback to the applicants so that they can see where they went wrong, learn from it and improve. However in order to do this we must have a level playing field. The initial rules of engagement must be clear and incorporate a continuous improvement process. Whether a company is successful or not in an application process there needs to be a mechanism whereby feedback goes back to the company. If they spent time and energy engaging in the process and applying for funding, and it was independently assessed by industry experts, the individual feedback given back to the company can be invaluable on its development path. If you receive no individual feedback how can you learn and if you do not learn how can you succeed? I say we need to embrace this approach and best practice, give constructive feedback to all start-ups and SMEs where possible and help them to succeed. They are on a path of continuous improvement so let’s help them improve.