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It’s not a pretty picture. While sixty-six percent of new businesses will survive to the two-year mark, less than half will reach four years. And how they reach those four years is less than inspiring. Most are working their tail off to just keep the lights on.

Despite those numbers, new businesses are started every year.

As a business owner myself, I used to wonder what set apart top businesses from the rest. How did companies like Amazon and Oracle not only survive but grow their businesses consistently in a bad economy? What was it that separated them from those companies that failed to make money like Vonage, and lots of smaller startups?

After taking a closer look and studying some businesses, I realized that there were four distinguishing factors that enabled these businesses to dominate a category and grow.


When you’re looking to build a business, you need to influence people…and having authority is the way to go. People respect other people who have authority, expertise and impressive credentials just like they respect people in lab coats and police uniforms.

But people respect authority so much more when you demonstrate it rather than just claim that you have it.

The vision for the company Affymetrix is that you should be able to walk into your doctor’s office and after a 30-minute visit he or she will give you a plan to treat you that is designed around your genetic blueprint. The company couldn’t pull this off if not for their expertise in the industry, seen by their leadership that’s full of PhDs in life sciences.

But startups also challenge authority, looking at ways to improve upon the status quo. If you think about most new technologies that change the way we live and work you’ll notice they usually come from left field.

But that’s also the reason you see so many startups run by egomaniacs, people who believe their product will change the world. If that’s you, understand, mixed with a little humility, that kind of confidence is pretty important because you will be fought, ignored and called crazy by people who will look at your product or business model and scratch their heads.

Listen…in the face of that resistance you need to be able to make tough calls and resist rejection. You need to be able to believe in your product and that what you believe is right even though everyone else is telling you are wrong. In other words, you need to have authority.


Author Neil Patel

Culture is going to be one of the most important intangibles when it comes to your success. When you have a culture full of employees who have your back no matter what, you’ll be virtually unstoppable. I think in the end, too, you’ll make better decisions when you have a great culture.

But how do you get that kind of culture? It starts with you and your personality. Here are some tips, taken from some of the best 50 places to work, to help you create and sustain a culture that will help your startup survive and thrive.

  • You need to interview every single new employee until your company reaches about 45 people. After that you should personally interview every single person who is going to supervise other people.
  • Let employees be individuals.
  • Spend time with every single hire on their first day. It doesn’t have to be long. Twenty minutes is good. Then you should follow up in about two or three weeks to see how things are going.
  • Learn the names of every single employee.
  • Learn to say thank you.
  • You should be the one personally rolling out the strategy and mission of the company during employee orientation training.
  • Hold an all-company meeting at least four times a year, re-enforcing your company’s strategy and mission.
  • Give your employees a chance to exercise or have fun.
  • Via email or internal blog, give your employees updates whenever there is major news that impacts your business or you are out attending conferences or visiting major customers. This way you are keeping them in the loop.
  • Show that you are part of the team and that you will help with any task, whether it’s emptying trash cans or planning a company picnic. And if people are required to work weekends, you should show up, too.
  • Consider allowing your employees to work from home two or three days a week.
  • Do not skip company parties or events ever. And always play the host.
  • Go cheap with furniture and other perks that you could indulge in, like flying class and not taking the front parking lot.
  • Give your employees a free lunch.
  • You should take the blame when something goes wrong. You should praise your team when something good happens. Never blame them or praise yourself.

When you create a culture where people feel they are not only part of a team but a family, your strategy and mission will be easier to accomplish and you won’t have to fight everyone to succeed.


Do you know where your brand stands in the marketplace? If not, then you can define that position through your Unique Selling Proposition (USP).

Your USP tells your target customers what you do and how you stand out from your competitors. These six questions will help you create your USP:

  • What are the three biggest benefits that you provide customers?
  • How can you be utterly unique?
  • Can you solve a performance gap or customer problem?
  • Can you offer proof for any claim you make?
  • Can you condense your USP into one clear, concise and compelling sentence?
  • Can you deliver on your USP?

Once you’ve answered all those questions, your next step is to start including your USP into all your marketing material, including your elevator pitch, headlines and business cards.

One design agency I know in New York has a chalk outline of a person on their floor in their offices. It’s the body of traditional ad agency model. This company is called Anomaly, and even though lots of new agencies are acting like they are the new anti-agency, Anomaly actually did things a lot different than their competitors.

For instance, they negotiate upfront a predetermined fee or royalties or equity stake in a product. Say a company comes to them with an advertising problem…Anomaly looks at the issue as a business one. That means they analyze everything from product development to design. They think about every piece of the business, so they’re truly not your typical creative agency.

Problem solving

The most important part of actually surviving and not becoming a statistic is to solve a real need for a customer. One company that is solving a need for customers is Tagstand. On their website they say: “We noticed one huge problem: buying NFC tags on the Internet is complicated. So we made it easy; we now sell NFC stickers and help you use them.”

But just solving any problem will not do it. See, normally when you look at a product you see concrete things about that product, like the design or technology. What’s important is that you need to see that these things exist for a purpose…to solve a customer’s problem.

So you need to look past the surface and see that it’s actually the selection of the problem that creates a product that has a chance to survive for a long time. Breakthrough products have a way of doing a great job of not addressing the same customer needs, but choosing an entirely different set of problems.

On the other hand, those companies that failed did so because they chose a set of customer needs that nobody cared about. Great companies and great products choose the right set of problems to solve.


If you look at the numbers, the odds are against you when it comes to starting a business. But if you study and apply the distinguishing features of successful companies, then you can actually raise your chances of success. What other factors can help a young business survive?

Neil Patel is the co-founder of KISSmetrics, an analytics provider that helps companies make better business decisions.

More from Neil Patel on GeekWireSeven signs that you might just be an entrepreneur Eleven things every entrepreneur should know about innovation… 17 things I wish I’d known when starting my first business

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