Introduction
We’re sure you’ve heard that startups face numerous challenges, from getting together the right team, to raising capital and then having the pressure of finding product-market fit for their innovative solution. All this, whilst often believing they need to beat out fierce competition from larger, well-resourced players. Not to mention these challenges are further exemplified with external factors beyond an entrepreneur’s control, such as the economic climate and market volatility.
For starters, attracting paying customers early in a startup’s journey is not only one of the hardest challenges, but often an expensive one too. Sure, your friends and family might be early adopters of a freemium service, but to attract a wider audience, you have to account for the cost of acquisition — and digital marketing doesn’t come cheap. Even when selling to businesses, getting a corporation to buy in to integrate or embed your services is a tale similar to that of David and Goliath.
So, what does it take as an entrepreneur to excel?
To excel, in school, means achieving an A. So let’s start with an A, or two A’s: awareness and agility. Founders have to have their ears to the ground, staying on top of the information available to them — for example, competitor insights, market dynamics, and customer feedback — to be able to develop and iterate one solution after another. The most successful founders recognize that small, incremental experimentation is key to utilizing existing capital effectively.
In this blog post, we explore how Wellx grew its business despite the odds of the difficult-to-penetrate insurance and healthcare industries in the UAE. For context, Wellx is a technology startup in the health, well-being, and insurance space with a unique value proposition to employers and their employees, based on population health analytics and behavioral science. Through embedded gamification and personalized incentivization, Wellx succeeds by driving healthier behaviors, for employees and employers alike to reduce sickness, absenteeism, and insurance premiums. Seems like a win for all, right?
Co-founders Vaibhav Kashyap and Javed Akberali share their experiences, from which we hope that many of you founders reading this will derive lessons learned for you to apply to your business strategies.
Lesson #1: Cautionary Note — Do Not Overpromise
Many founders are people-pleasers, which means they are more likely to fall into the trap of promising too much value or too many features, mistakenly believing that by doing so you will increase customers’ willingness to pay. This approach can potentially jeopardize your business in the long run, internally creating pressure on your employees to deliver at pace and potentially even affecting your brand reputation.
Furthermore, founders often may make concessions — for example, discounting the rack rate price, too quickly; again, in desperation to secure a contract and revenue. Although, in the short term this may help with cash flow, if you provide one customer with a generous deal, there’s a likelihood that they will expect the same discount over the long term. This diminishes their lifetime value, or worse, other customers will expect the same terms, diminishing your business value and ability to attract future profitable business.
The founders of Wellx, for instance, reflect on their early challenges of financial and mental strain resulting from overcommitting, highlighting the importance of understanding the market first and then managing customer expectations effectively.
Lesson #2: Strategic Direction is Crucial
Whether going to a new networking event, partnering up with a peer, or any of the hundreds of little decisions startups face regularly, everything should revolve around your vision, a future-focused statement detailing what you are trying to achieve. Once you’ve got that clear, the next critical piece is to define how you will get there. Careful consideration and detailing of your mission, strategic objectives, and goals are required.
Losing focus is so very easy in entrepreneurship, where pace and pressure are high, and distractions are plenty. With every decision you make, you should answer one question first, “Does this align with my vision?” If so, then ask yourself, “Where does it fit into my strategy?” If the answer is that it doesn’t, you may need to do the unthinkable and decline.
With Wellx, their mission revolves around creating healthier, happier, and more resilient communities globally. And so, the founders had an added pull of wanting to give back to society positively too — being global, with a local touch.
With this in mind, their community-focused partnership with Amal Counsel, a local social enterprise, aligned with their mission as a business. Together, they gave their customers access to around-the-clock mental health counseling, as well as a free counseling session for members of the community who couldn’t afford it in normal circumstances.
Lesson #3: Don’t Play the Blame Game
“We didn’t look for blame. If something didn’t work; we tried to understand why; failing fast and learning faster. Blame not only takes time to process but sets you back as a company — we didn’t want our culture to be centered on blame; we chose it to be obsessed with solutions, innovating and solving to drive our customers and our business forward.”
In times when things go wrong, it may feel like time, energy, money, and effort were wasted. It becomes easy to give in to the frustration of it all and look for a scapegoat. But it’s in these circumstances that the company values should influence and govern behaviors.
Recognizing being in a start-up, particularly an early stage one, is challenging. This uncertainty requires each member of the team to develop their own resilience to be able to ride the rollercoaster of entrepreneurship. Wellx’s founders reflect that most entrepreneurs succeed not because of their capabilities, but because of their capacity to stay calm, creative, and collaborative when faced with situations where things don’t quite go as planned.
Lesson #4: Passion as a Trust-Building Tool
“How do you get other people to believe in what you're doing? It starts with you believing in it yourself and then projecting that excitement, energy, and passion into everything that you say and that you do.”
Passion is contagious. When founders and their team members are genuinely passionate about the mission and vision of the startup, it creates a positivity that inspires — and from there, their enthusiasm becomes a trust-building tool that communicates sincerity and commitment to others. External stakeholders, including investors, partners, and customers, are more likely to trust and support a startup when they witness the authentic passion of those driving it.
Without genuine enthusiasm for what you’re building and the impact you want to make, stakeholders may question the startup’s ability to survive and thrive.
Lesson #5: Boldness-driven Growth
In the startup ecosystem, being brave, and taking (measured) risks are not just traits, they form the driving force behind entrepreneurial growth. In particular, their ability to problem-solve at pace and adapt plans to drive improved success.
Entrepreneurs fueled by this seek out new perspectives, actively engage with challenges, and view setbacks as opportunities for discovery. This mindset not only propels individual growth but also fosters a culture within the startup that values exploration and embraces the unknown.
An example of an unconventional partnership proposal from Wellx to WHOOP — from a small, aspiring wellness startup to one of a global household name in fitness — demonstrates the benefits of boldness in opening new avenues for growth.
On the other hand, a rigid mindset can backfire in the world of startups. It can stifle collaboration and discourage the “out-of-the-box” thinking that is crucial for breakthrough innovations.
Lesson #6: Humility in Collaboration
Some founders may be hesitant to admit their inexperience, especially to potential partners — afraid of being passed over to someone more experienced. While this thought process may seem rational at first, it fails to account for human nature and the desire to help.
The key, Wellx founders say, is to admit your shortcomings but also admit and show your openness to feedback and be curious to learn. Potential partners may have once been in the same situation — after all, all businesses have had their share of falling on hard times.
Conclusion
Successful entrepreneurship and partnerships hinge on achievable expectations, a clear direction, resilience in adversity, passion, curiosity, and humility. As illustrated by Wellx’s journey, these principles provide a roadmap for startups and partners alike, fostering enduring collaborations in the dynamic business landscape.
If you are a founder who is passionate about building innovative solutions in the Future of Finance or Future Economies industries and meet our investment thesis, we invite you to apply for consideration for direct investment. You can also learn more about our Direct Investments deal lifecycle process here.