This article was originally published on American Express Open Forum.
Our culture loves nothing more than self-made heroes. That celebration of grit and determination extends to the business community as well, which is why lean, scrappy startups can hold an advantage over established companies.
Underdogs represent the essence of entrepreneurship. When everyone doubts them, they break the rules and redefine industries. It’s that energy that rallies investors and champions to their corners.
The tech industry can be especially friendly to underdogs. The cost of starting an online business can be far less than that of a brick-and-mortar operation, and it can be easier to achieve market separation. Startups quickly sniff out and react to market changes, giving them an edge over legacy brands slow to embrace new trends.
How to Keep Your Bite
In the internet age, overnight success stories are common — just look at media companies. While a more established newspaper may be challenged to adapt, smaller outlets can get snapped up quickly by larger corporations. Although it may be more difficult for underdogs to break out in heavily regulated industries such as healthcare and manufacturing, virtual channels can create new gateways every day.
These strategies may help you maintain your startup strengths as you strive to become the leader of the pack:
1. Think micro, even as you go macro.
The best companies don’t see themselves as underdogs. They keep their ears to the ground, relying on their scrappy instincts to plot their next moves. Larger companies may become comfortable and complacent, only to be overthrown by underdogs.
Approach every situation as though you’re outmatched, and don’t assume more money means a spending free-for-all. Consider leveraging SEO, social media and word-of-mouth marketing instead of dropping millions on traditional advertising.
Look for other ways to keep costs low as well. When my first company organized a conference, I was stuffed in a hotel room with our co-founder and our VP of marketing. We’re teased to this very day, but those decisions keep companies lean. Expenditures don’t have to increase just because revenue does.
2. Stay hyperfocused on sales.
Wake up every morning with a ruthless determination to claw out a corner of the market. I don’t care if your background is in engineering or website design. When you first launch a company, your No. 1 priority should be closing deals and outperforming the competition. Hire people willing to make as many calls as it takes to help the company and those who can jump in when you need to get your numbers up.
3. Strategize for market separation.
Think hard about how you position your company. Unless you’re inventing a new product genre, you’ll likely be facing household brands that already have strong market shares. How are you going to differentiate yours?
The day you stop thinking like an underdog can be the day you become less adaptable, less innovative, and, frankly, less competitive. Too many industry pioneers can lose their way as they transition from startups to massive enterprises.
I’m not telling you to think small — you’ll always seek new horizons for your business. To maintain that success, however, you must be a top dog with underdog sensibilities.
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