Silicon Valley is the Mecca for tech startups. Or so most would have you believe.
"The majority of tech startups that have gained a $1 billion valuation in the past decade hailed from outside Silicon Valley," the FT's Murad Ahmed reports.
The perception that to become a successful tech company requires you to be in Silicon Valley isn't as misdirected as the ideologies that have spawned out of there. These have been wrongly perceived as the de facto method of building a successful startup, as have many other Silicon Valley companies.
I'm a member of the Young Entrepreneur Council (YEC), which is named as 'one of America's most successful communities for business professionals' by Entrepreneur magazine.
This invite-only organization is comprised of under-40 founders of companies with at least $1 million in revenues or financing. Members from the San Francisco Bay Area constitute 12 percent of the entire North American community.
Don't make the mistake of imbibing what you hear coming from the mouths of the Silicon Valley behemoths for there are many, many more who have proven otherwise.
Here are some of those ideologies to be wary of.
#1 - The success of your startup depends on having a co-founder
Getting inducted into one of the most popular startup incubators -- Y Combinator, is next to impossible if you're a solo founder. Its founder, Paul Graham has been a strong proponent of the theory that startups with co-founders outdo those with solo founders in terms of successfully building a sustainable business.
Even if this fact is supported by statistics, you're certainly not building a business based on the statistics within your industry and the number of startups that have failed because they were single founders. You're building a business based on a customer need and a passion to solve that problem.
Your passion to solve that problem is not going to wait until you find another person to run the company with.
The number of solo entrepreneurs waiting to startup post acquiring a co-founder is mind numbing. Just look at the number of parallel businesses that have started in the founder-dating space and the incredible number of people landing up at their 'dating' events.
If you're in the very early stages and need to get your startup off the ground, waiting for the right partner can potentially set you back by a few years. Engineers as co-founders are even harder to come by. The best one's are either gainfully employed in high-paying establishments, or are starting their own ventures.
At the early stages of your startup, what matters is getting validation for the idea, getting to product/market fit and getting early feedback on the product or service. Along the journey, you may find someone who's equally excited about building it as a business and the one to partner with in the long term. Serendipity is best when it comes to finding a co-founder; you can't really force it.
#2 - Build an MVP. Always build an MVP
Some go too far with the MVP or the minimum viable product methodology, misunderstanding the fact that an MVP is different from lean startup fundamentals. At best, it's a part of it, not necessarily an imperative.
You can build a complete product and still run a lean startup.
Not every product or service launched requires one to build an MVP. If you're building a product or service similar to an existing one or many, but better, the users are likely used to an existing experience, which you cannot take away. You have to build further on that and deliver a better product.
How does an MVP fit into the scheme of things then?
Of course, if your product is so unique that no other similar one exists - such as when Snapchat launched, that could call for an MVP. Products similar to Snapchat that were launched later can't afford to build an MVP.
#3 - A services business is a shameful one to start. Build a product.
The popular notion among most is that starting a services business is 'beneath' them.
Typically, product businesses are non-linear versus services businesses that are linear in terms of scalability. But that doesn't really undermine their value. Services businesses are the foundation on which most products are built.
Take for instance design and marketing agencies, development consultancies, managed cloud hosting, etc are all services without which most products couldn't get built.
Services businesses are the ones that help launch many product entrepreneurs' dreams - so if that is your calling, go build a services business to scale.
A quick note on the services business: you can generate revenues and operating profits from the get go and a services business requires very little capital to get started.
#4 - Outsourcing product development is a bad thing.
People across the Silicon Valley like to believe that every product or service will land a venture capitalist and they'd require the tech to be completely in-house.
The truth is that not every startup gets funded by venture capitalists and more importantly, venture funding is not the only route that is available to an entrepreneur to grow their business. Many don't require any funding at all!
So, that out of the way, let's ask these pundits a simple question: if a person wants to build a product on the side and doesn't have technical capabilities, should that person have to quit the job or whatever they're doing and invest all their savings in an up-front team without even getting to product/market fit?
How does one even get started? Look for a technical co-founder, they say. But that we've already addressed above.
If you experience sleepless nights, if you can't wait to get started, outsource the tech in the initial days and once you have product/market fit, once you get your traction rolling, there would be many ways to then build an in-house team.
Some of the most popular products you use today were outsourced in their initial days - Skype, Fab.com and even the billion-dollar-valued Slack.
All you need is an entrepreneurial spirit, fantastic strategy and good talent and you could be the next million or billion-dollar company emerging out of your own home turf. You don't need any Silicon Valley pundit directing you what or how you should build or run your business.
In fact, it's the outliers that don't conform to these beliefs who are the most successful entrepreneurs. And Paul Graham does agree to that.