The word "startup" has become a popular buzzword in recent years. Starting a business is the first step in building a profitable business. By default, a startup is a losing business until it becomes profitable. Cockroach Startups are the best kind of startups.
What is a Cockroach Startup?
Cockroach startups are startups that have a profit-making goal. Since the market is drying up and investors are becoming more aware of this, 2021 is going to be a difficult year for startups.
In the same way as cockroaches, a cockroach-like startup persists in its efforts despite changing market conditions, environments, or investment scenarios. This group of people is capable of deciding where to spend money and where not to.
One that struggles and persists in spite of shifting market conditions and investment scenarios is called a "cockroach" startup. When it comes down to it, they're the ones who have the knowledge and experience to know where to spend their money and where not to.
Why the name "Cockroach Startups"?
Cockroaches are disliked by most people. With good reason, too. Cockroaches are unattractive and can spread illness. So why the bizarre name?
Research says that cockroaches have been around for 320 million years, long before dinosaurs.
In addition, cockroaches are endowed with the following traits:
- The ability to survive on anything is unquestionable.
- You might think of fruit or leather or paper or skin flakes or hair or dead insects or even soiled clothing when you think of these materials:
- The growth of cockroaches is astronomical.
- Only dies from lack of water after surviving a week without its head.
Without food, they can last a month.
- Expected to survive a nuclear detonation.
Let's look at the similarities between cockroaches and cockroach startups.
Cockroach Startups are characterized by the following characteristics:
- Companies with a low salary and expense budget. In order to continue living, one must overcome obstacles.
- The growth that is explosive.
- In the absence of venture capital, long-term planning is impossible.
- Constantly adapts to changing markets
- Possibility of becoming cash-flow positive quickly
- By having a real product or service, you can survive a nuclear war in business. The norm is to have a rock-solid revenue model and paying customers.
Cockroach startups are those that have a profit-making goal.
Follow these 7 tips and techniques to create profitable cockroach startups.
Tips to create a Cockroach Startups
1) You should limit the amount of money you spend on fixed assets
We made it a rule early on that anyone hired had to bring their own laptop to work. We were able to save a lot of money thanks to it. So, if you have 20 employees, you'll be spending around Rs 7,00,000 on laptops. Based on usage, you'll need to replace it at least every two years. Laptops will cost you approximately Rs 3,000,000 per year.
Alternatively, you could use that money to hire a valuable employee!
2) Charge money from the very beginning
Whatever you decide to make, you should start charging money from the very beginning.
If you make your product free and a lot of people use it, you can worry about monetizing it later, according to a widely held belief. This is a problem for a lot of businesses.
Your product's true value cannot be tested when it's free. As a user, you are more likely to accept a free offer because you have nothing to lose. A $1.99 item has now become a liability. No one is going to pay for a product if they don't value it.
3) Non-technical founders should become more technical
Build it yourself if it's something that's really important to you! As a tech startup, your business relies heavily on technology to function effectively. It is your ability to improve and optimize the product that gives you a competitive edge. Many potential improvements are lost without a certain level of technical knowledge.
If your business involves food, you must have a solid understanding of the subject. When it comes to technology, you'd better know a little bit about it.
4) Sell your vision and enthusiasm to potential employees, not just a higher salary to lure them in
A higher salary would not have attracted the best talent, despite the fact that it was an option.
As a matter of fact, you should actually sell on our vision.
Tell them that they'll learn a lot if they come to work for your company.
People who were only here for the money were automatically filtered out, and dedicated people stayed.
5) Check to see if your business plan will generate revenue before you commit to it
It's the same thing when you're starting a coffee shop. As a business owner, your goal is to create a profitable entity that allows you to generate income on demand.
Your business's ultimate goal is to generate revenue. Profit is the goal of every sale you make. This is a bad business model if you lose money on every sale.
6) Don't let money overshadow the product/service
It is impossible to ignore the importance of adding value.
Great startups have always had value at their core. Startups that focus on providing excellent services or building products that people want to use are perfect examples of cockroach startups.
7) Time is more important than money
It has been said that Time is more valuable than money.
Not to die, but to survive, to earn money, and to earn enough money to pay the bills is the goal of cockroach startups.
In the next three years, a cockroach startup does not expect to be a big hit. They want to learn how to build businesses that will last for 10, 50, or 100 years instead of just a few short years.
It takes a lot of learning to launch a new business venture. Learn new skills every day, from how to make minor improvements to understanding customer needs.
Experiments should be used to measure profit growth if you're already making money.
Learning should be a priority for entrepreneurs. For more learning, simply increase the number of experiments when time is limited.
What is a Cockroach company?
A cockroach startup is the one that keeps growing slowly in the forward direction just like a cockroach without being much affected by the changes in the market.
Is there difference between Cockroach startup and Unicorns?
Yes, Unicorn startups are the companies with valuation of more than $1 billion, whereas Cockroach startup believes in sustainable growth rather than valuation.
Are Cockroach startup or business less risky?
Yes, Cockroach startup are considered less risky as it emphasises on cost control.
Must have tools for startups - Recommended by StartupTalky
Subscribe to StartupTalky
Get the latest insights delivered to you right in your inbox