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Business Management

Why Tech is Vital for Your Startup

To build a real business you need some tech and a lot of grit, luck… and tech.

A spacious, well-lit office with people working on computers.

T hese days, technology has given entrepreneurs access to software-as-a-service and B2B tools that can streamline

everything about the startup experience. From instant bank accounts to overnight LLCs, most entrepreneurs can click a few buttons and get things off the ground. But is faster really better? We talked to a few entrepreneurs who have built in both eras and asked them what tools and OG tricks they used to build their businesses.


Matt Burns, an events coordinator for TechCrunch and coach, has seen startups get easier and easier to build.


“Back when we started out [in 2008], building a startup was like building a house. You had to find an architect, hire contractors, and pick up materials. But unlike a house, you had no ideas if the whole thing was going to fall over when you were done. It was a crazy time,” he said.

The Old School


“Young entrepreneurs need to know it wasn’t always SaaS and roses,” said Burns.


The landscape for starting a business in the early 2000s  compared to the present day has seen significant transformation, driven mostly by technological advancements. Tech has redefined the modern entrepreneurial experience, making it at least more accessible than ever before.


In the early 2000s, aspiring entrepreneurs faced endless obstacles, from securing funding to establishing a customer base. They also had to navigate the complexities of marketing in a nascent online ecosystem. Access to startup capital was one of the biggest hurdles, with many relying on traditional bank loans, personal savings, or the elusive angel investor to get their idea off the ground. 


Further, women and POC founders had huge issues.


"Building a tech startup in the 2010s as a woman and non-technical founder was an uphill battle,” said Jeanette Cadije, a repeat entrepreneur.  


Cadije said that digital tools for market research, customer engagement, and online sales were in their infancy, often requiring significant investment in bespoke solutions or expensive subscriptions to third-party services. Furthermore, the lack of widespread cloud computing infrastructure meant that businesses had to invest heavily in physical hardware and software, making scalability a costly and challenging endeavor. Finally, VCs just weren’t interested in inclusiveness and DEI.


Other entrepreneurs complained about access to tools and hardware.


One anonymous entrepreneur I spoke to remembered bringing a massive web server with him in a suitcase on a trip to Switzerland to expand his company’s web presence. Essentially something that takes us all two minutes to do on a service like Digital Ocean took him a fifteen hour flight and about $2,000 for an airline ticket.


Even with cash, some founders’ hands were tied.


“My visionary idea was a decade ahead of its time, and the lack of tools for product analytics meant I had to build a custom dashboard to track user behavior,” said Cadije. 


“Without a technical co-founder by my side, I relied on my grit, determination, and resourcefulness to overcome each hurdle, even if I didn’t fit the pattern recognition VC’s had in their mind to bring my idea to life,” she said. 


While the ecosystem is similar to what it is today, the ability to find a bank, incorporate, and even access mentors were prohibitively costly and frustrating. 

Technology has given entrepreneurs access to Saas and B2B tools that can streamline everything about the startup experience.

New Tools for New Startups 


Funding is also easier these days. Crowdfunding platforms like Kickstarter and Indiegogo have democratized access to startup capital, allowing entrepreneurs to pitch directly to potential customers and investors worldwide. Equity crowdfunding offers entrepreneurs the ability to sell directly to retail investors. Social media platforms and digital marketing tools have evolved to offer sophisticated targeting and analytics, enabling startups to reach their desired audience with unprecedented precision and efficiency. 


Entrepreneurs can now access a plethora of tools for everything from inventory management to customer relationship management (CRM) on a subscription basis, allowing for flexible growth and adaptation to market changes.


Perhaps most revolutionary is the rise of the gig economy and freelance platforms, which have made it easier for businesses to access talent on an as-needed basis, reducing the need for full-time staff and the associated overhead costs. This shift has also facilitated a more diverse and global workforce, enabling startups to harness the best talent from around the world, regardless of geographical limitations. In other words, startups aren’t tied down to a single geographic location which meant for a long time that they had to be based in San Francisco.


Finally, advancements in artificial intelligence (AI) and machine learning have opened up new avenues for innovation, from automating customer service through chatbots to leveraging data analytics for personalized marketing strategies. These technologies have not only streamlined operations but also provided small businesses with the tools to compete against larger players in their industry.


Not everyone agrees, however. One entrepreneur, Eric Villines, co-founder of Presidium Security, said that building a business was easier in the old days.


“There is no doubt that building a tech startup in the early 2000s was much easier. Amidst the dot-com bubble, funding was more readily available, technological barriers were lower, and regulations were less stringent,” he said. “Today, even though funding options have diversified, the dot-com crash and the financial crisis of 2008 have made investors much more risk-averse. Additionally, regulatory requirements and technical hurdles have increased exponentially.”


He thinks that even with all the improvements, entrepreneurs are now living in a more difficult ecosystem.


“Between the lawyers, cybersecurity experts, and development teams, the days of trying to run a tech startup from the garage are over,” he said. “This isn’t to say it’s impossible to create a successful tech startup, but it’s just harder to get teams together willing to collectively take a chance on a good idea. Many good people have been burned, and so entrepreneurs have much more cynicism to contend with these days”

A desk with multiple laptops and accessories and four people working.

Real Startups, Real Tech


What does it look like when tech is vital to a startup? Let’s take a look at two popular startup tales.


According to Internet lore, Travis Kalanick was in Paris when he and his friends wanted to call taxis with the press of a button. The idea grew and morphed over time but Kalanick and his friend Garrett Camp created a simple app that would call a car instantly. It was just a button, according to an interview he gave at TechCrunch Disrupt, and behind the scenes they set up a system to contact limo companies to come and pick them up. This first demo, their simple MVP, convinced investors enough to give them their first seed investment. 


The rest, as they say, is history.


Another company that depended on early tech was Airbnb. When founders Brian Chesky, Joe Gebbia, and Nathan Blecharczyk created the company they thought the business would involve apartment dwellers blowing up air mattresses and inviting people into their homes. This form of hospitality didn’t quite work and, as a result, they had to raise money quickly.


First, they turned to some decidedly low-tech methods.


During the 2008 U.S. presidential election they went online and sold cereal. The cereals, which they designed, included "Obama O’s" and "Cap’n McCains". This initiative helped them raise $30,000, which, while modest, was crucial for keeping the platform alive.


Their next step was to use the tech they had in hand to keep the company running. For example, Chesky took his digital camera to Airbnb host houses to take pictures of their spaces, editing them in order to make the service more appealing. 


They also capitalized on the growing trend of peer-to-peer services and the widespread adoption of social media, using these platforms to market their service at a low cost. Finally, Airbnb focused on creating a seamless, user-friendly website and mobile app, which facilitated easy browsing, booking, and communication between hosts and guests. This focus on technology not only helped Airbnb to operate efficiently with limited resources but also enhanced the user experience, leading to word-of-mouth marketing and rapid growth.


Airbnb's strategic use of technology extended to data analytics and machine learning algorithms to optimize pricing, improve search rankings, and personalize recommendations for users, further driving bookings and user engagement. These innovations enabled Airbnb to expand its offerings globally, quickly making it a formidable competitor in the hospitality industry despite its initial funding challenges.


But, again, each of these technical improvements cost money and time. Now the same tools that Chesky and his friends paid dearly for are available to anyone at any time. The moral of these stories? To build a real business you need some tech and a lot of grit, luck… and tech.

Image of a woman in a business suit standing in front of a group of people

A Business vs. A Company


In the end, tech can supercharge a bad idea. Don Dodge, an investor and board member, sees tech as a tool, not a savior.


“It has never been easier to start a company, but it is much harder to build a business,” he said. “SaaS companies provide scalable infrastructure and services for startups that can be purchased on a monthly subscription basis. So, there are very low capital requirements.”


“Building a business is really hard,” he said. “There is a lot of competition from big companies and thousands of startups. They all tell the same story and use the same buzzwords, so they all sound the same. Breaking through all the noise, and getting customers to buy is still hard.”


So while tech can help, it isn’t the most valuable tool in the entrepreneur’s toolbox which has been true since even before we could spin up a dozen AI assistants to help us with everything from coding to calendar management. 


Maybe, in the end, the real trick to entrepreneurship is just showing up?

Key Takeaways

1

Technological Evolution in Startups

Technology has significantly transformed the startup landscape, making it easier and faster to launch a business. Modern entrepreneurs have access to Software-as-a-Service (SaaS) and B2B tools that streamline everything from setting up bank accounts to incorporating a business.

2

Challenges of the Early 2000s

In the early 2000s, starting a business was more complex and resource-intensive. Entrepreneurs had to navigate significant obstacles such as securing funding, establishing a customer base, and managing physical hardware and customized digital solutions.

3

Improved Access and Inclusivity

Technological advancements have democratized access to startup capital and essential tools. Platforms like Kickstarter and Indiegogo, along with social media and digital marketing tools, have made it easier for diverse groups of entrepreneurs to launch and grow their businesses.

4

Scalability and Differentiation

Modern startups benefit from scalable solutions where costs do not increase linearly with growth. Differentiation through unique features, branding, and customer service remains crucial for standing out in a competitive market.

5

Persistent Challenges

Despite technological advancements, building a successful business remains challenging. Entrepreneurs must navigate increased regulatory requirements, higher expectations for cybersecurity, and a more competitive market. The ability to build a sustainable business requires more than just technology—it demands grit, luck, and strategic execution.

John Biggs is a powerhouse of words. He’s authored books on young adult fiction, technology, entrepreneurism, historical fiction, and more. His journalistic work has appeared in national publications such as the New York Times, Laptop, Gizmodo, Men's Health, and TechCrunch. In addition, he runs the BWL family of blogs, which includes Knapsack News and WristWatchReview.com. Read more

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