There are currently a range of obstacles facing European startups and small businesses that can seem insurmountable. Economic instability, talent shortage, digital disruption: how can startups keep up?
With almost €1.5 billion already committed to helping the sector grow, we know that running a growing business is not easy. In particular, cost control is currently the priority.
The good news is that technology offers practical and affordable solutions for startups looking to strengthen their operations, reach more customers, and ultimately survive and grow. With so many digital tools now at their fingertips, small teams can work smarter, scale faster, and gain an advantage once reserved for larger competitors.
Operating costs – Cloud-based solutions, remote working technologies and automation tools can significantly reduce overhead costs such as office space, equipment and manual processes. Cloud computing provides affordable and scalable access to advanced computing resources without major infrastructure investments. Remote collaboration platforms enable distributed teams and virtual workspaces, reducing the need for physical offices. And intelligent automation can handle repetitive back-office tasks, freeing up staff time and reducing labor costs. Together, these technologies free up resources for other parts of the business and allow startups to become more agile and streamline their operations.
Financial control – Controlling operating costs also requires excellent real-time visibility of financial figures. “Follow the budget” is one of the best tips for startups and managing cash flow is how you do it. Digital accounting automation allows for up-to-date tracking of income, expenses, invoices, taxes and more. Machine learning streamlines expense reporting, and cloud-based financial systems enable remote multi-user access. Payment processing is accelerated through digital channels. Using these tools, startups can better manage their cash flow, identify waste, and make data-driven decisions.
Find customers – Startups often lack large marketing budgets and strong brand awareness compared to longer established companies. By leveraging social media, digital marketing software and e-commerce platforms, they can exploit new ways to reach potential customers online in a targeted and cost-effective way.
Most founders are familiar with social media, which allows for personalized engagement and community building. Email marketing software may be less familiar. It provides data-driven tools for targeted promotional campaigns, allowing startups to segment contacts, create personalized content, automate workflows and analyze performance. Features like A/B testing and analytics help optimize email reach and engagement.
Search engine marketing is also vital. It encompasses paid search advertising and search engine optimization (SEO) to improve organic search visibility through keyword optimization, site speed, mobile friendliness, and content creation. high quality backlinks.
Together, optimized messaging and a targeted search presence provide affordable ways to drive traffic, generate leads, and increase conversions for startups. Advanced platforms make these powerful tactics accessible without large marketing departments.
Data and cybersecurity – Due to limited resources and expertise, new businesses may be vulnerable to cyberattacks and data breaches. Security solutions to protect intellectual property, customer data and reputation are essential, but many tools tailored for large enterprises are complex and can be a costly overhead. Fortunately, security software designed specifically for growing businesses offers cost-effective protection – from endpoint security to firewalls tailored to small business networks. If the worst happens, DR (disaster recovery) can be implemented via scalable cloud backup to provide affordable protection against ransomware, disasters and downtime. With the right solutions, small businesses can implement enterprise-grade security practices.
Skills gaps – Small teams with cross-functional responsibilities may lack skills in key areas as they juggle various roles. Online training platforms now provide on-demand access to staff to upskill in areas such as digital marketing, data analysis, project management, communication, and more. Freelancers and contractors can also fill short-term gaps, bringing specialized expertise without the need to hire full-time. For technical positions, coding bootcamps and certification courses allow for rapid reskilling. With modular learning and talent options, it is now much easier for startups to quickly develop in-demand skills.
Find new employees – Small startups often can’t compete with larger companies when it comes to recruiting budgets and employer branding. However, digital tools can help level the playing field. Leveraging these platforms allows SMEs to secure talent for specific projects or tasks without the long-term commitment and overhead of traditional recruitment.
Additionally, job boards and social media help target candidates. Applicant tracking systems streamline screening and communication. Selection tools like skills assessments and video interviews identify top candidates faster. Onboarding software makes transitions easier for new hires. With talent acquisition technology, startups can effectively attract, evaluate and onboard suitable candidates despite limited HR resources.
Access to capital – This is of course my specialty. After the funding glut of 2021/22, many startups are finding it increasingly difficult to secure loans and investment, limiting their growth. Financial technology now offers alternative options beyond traditional financing avenues. Crowdfunding can raise smaller amounts from multiple backers. Peer-to-peer lending connects lenders directly with business borrowers. Invoice financing unlocks cash tied up in unpaid invoices. Simplified digital applications also make it easier to access government financing programs. With more ways to cover costs, investment and growth are no longer out of reach.
Regulatory conformity – Complying with complex regulations such as taxes, data protection and industry-specific requirements is a challenge, especially for small teams. Legal and regulatory technology provides user-friendly tools to manage compliance tasks.
- Solutions include digital tax filing solutions like Xero which automate processes such as VAT calculations, returns and payments to tax authorities. This saves time and reduces compliance errors.
- Data governance tools such as data mapping and data discovery software provide visibility into the personal data that businesses hold to comply with GDPR requirements.
- License and permit tracking platforms provide dashboards to monitor renewal dates, manage documentation, and get alerts of upcoming certification deadlines and much more.
- Legal advice apps allow startups to get on-demand answers to common legal questions and customize documents like contracts, NDAs, and policies specific to their business needs.
- HR software helps with employment law compliance by digitalizing processes such as background checks, leave management, and distribution/tracking of workplace policies.
By streamlining tedious compliance processes, these types of regulatory technology tools reduce administrative burden so founders can focus on core business objectives.
Nothing replaces business
Of course, technology alone does not guarantee success: ingenuity and determination are always the driving forces of entrepreneurs. But embracing innovation, even incrementally, can allow small players to think big, punch above their weight, and create their own underdog success stories.
Main image: Photo of Maximum focus