“Why do People need Doctors? Why does a pilot need a Co-Pilot?
Chances are you have already understood half of the jobs that Startup consulting firms are hired for.
Traditionally, Consultants from Consulting Industry Giants like McKinsey, Bain, BCG etc are extremely expensive and hired exclusively by Top Enterprise Companies.
There are several small to mid-size consulting firms that cater to the SMB’S. With the rise of Startup Revolution, a number of Firms that offer Strategy Consulting For Startups have popped up most of which provide complimentary but indispensable services to Startups like company registration, business plan creation, pitch decks and fundraiser plans. Some of the reputed ones do offer Strategy and Management Consulting services as well.
Question is that, given their size, stage and cash flows, do Startups need Consulting services?
Let me list some advantages of hiring Startup Consulting firms and if it fits your use case and if you should hire one is up to you to decide.
No matter how long you’ve worked in the vertical, running a business is a completely different ball game. You need to know the Best Practices followed across industries to keep the operations streamlined and efficient. Following them would minimize the rework that might be needed later and help you focus on growing your business now.
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Creating a Rock Solid Business Plan early on is the most critical aspects that most Startups fail to create. You need to identify your business model, revenue streams and need to turn your narratives to numbers. This will help you create hiring timelines, allocate expenses, forecast revenues and raise funding. Consultants will help you create a Step by Step plan to make your Business profitable.
Well Defined Milestones
A consultant can help you create a Go To market Strategy. Competitive analysis and Customer requirement gathering will help you break down your vision into well-defined milestones and create an executable product roadmap.
Know the Market
Consultants can help you understand a holistic and disparate view of the Market. Complete understanding of the value chain or customer segmentation helps in market sizing and targeting the right customers.
Consultants can help you identify and connect with mentors, investors, or businesses to partner with. They can help with Domestic and Global expansion which otherwise would be difficult and time-consuming.
Get things done quickly
Building a Startup by its core definition is a race against time. You are better off outsourcing some jobs to the experts who in retrospect you’ll find saved you countless invaluable hours.
You can be too large, complicated, and emotionally involved to understand the inner workings of your psyche. A corporation post a certain size loses the ability for self-diagnosis. A third perspective will help you contain your thoughts and focus on what’s important and drives value for your business.
Know What’s working and what’s not
You will almost always be carried away by the decisions that you’ve made and processes/operation in place. Your judgment will be clouded by diversified workload, and emotions. A consultant will tell you what’s working for your business and what is not. It will help you keep your costs low and increase profits by identifying operations and campaigns that need to be shut down and the ones that need to be continued or invested in.
Subject Matter Experts
Being a Startup, you want maximum output from minimum resources. At the same time, you need Star Players to handle Finance, Marketing, Development etc.
Vision into the future
Chances are that started small and created a niche market for yourself. But with changing times comes changing requirements. You need Super Smart people who can influence your decisions. You need access to Senior Leadership who have been there and done that. They can guide you in building core values for your business, and create a vision to work towards building a company that you had no idea could ever exist.
Building a startup is tough! your idea or progress validated by super smart people will give you and your team a much-needed Confidence boost which in turn will help in increasing productivity and happiness.
Neutrality / Consensus Building
Internal consultants lack clout and are conflicted. They fail since they need to provide sometimes harsh recommendations on their peers. Political leverage that you get from hiring a consultant can help the decision-making process.
Data and Analytics
You have access to your data and some more data that you have collected over the course of time. But Consulting firms have access to way more data. They have already produced analytics to make the right decision. They have access to 1000’s of case studies that more or less will map directly to your business.
Consultants deal with companies of all sizes both domestic and international. They can help you understand the Global perspective to build your product and target market accordingly. What may work in India, might not work in the USA. Can you vision Self-driving cars in India in the immediate future?
Know multiple industries
Consultants have worked across several industries and have knowledge of how they operate and affect each other. You might know your industry well enough but an eye into complementary industries is always an advantage to move fast and create a disrupting business.
Should Startups hire consultants is dependent on the team pedigree, the problems, the scale and the funds available. But if you find the right fit, a consultant can add a lot of value to your business.