90% of startups fail. Be the 10%.
Companies that follow The Path Forward raise a Series A within 12 months.
We built The Path Forward to give new founders the best, multi-discipline, help from day 1. The Path Forward divides startup creation into 3 distinct stages. Each stage focusses on a product-mindset and contains a collection of practical guides for performing business activities that will enable you to efficiently move from one stage to the next.
3 Stages
Successful startups negotiate these three stages.
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Valid Idea
An idea is valid when it has been translated into a product concept which resonates rationally and emotionally with customers. The product concept should be validated through well conducted customer interviews and customer responses to early versions of the product.
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Valued Product
The product is valued when it has provided real value to a significant and growing number of customers, some of whom love the product enough that they have become evangelists.
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Valuable Business
The business is valuable when there’s a clear path to profits. Customer lifetime value should be on a path to exceed the cost of customer acquisition, the company should be on a strong growth path and the team should be strong enough to grow the company by an order of magnitude.
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9 waypoints
All the steps break down into 3 waypoints, covering the critical areas of Fundamentals, Growth & Team.
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Proven Need
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Strong Fundamentals
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Right Skills
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Emerging Team
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Promising Metrics
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Customer Traction
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Rapid Growth
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Empowered Team
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Scalable Economics
Proven Need
The need is proven when customers validate the problem space by describing their frustrations and actions they’ve taken to find solutions, and by responding positively to prototypes and the first version of the product.
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Strong Fundamentals
The fundamentals of a business are strong when it's clear that the market size is significant enough to support the company's vision and ambition. Additional fundamentals that must be proven are that good margins will be generated at scale, good value customer acquisition is achievable and market competition is benign.
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Right Skills
Companies should have the skills to create the early versions of the product. This will involve the crafting of a compelling value proposition to defining and then building the product. They must be able to hustle to acquire the first customers and there should be someone to challenge and support the founder. Typical team size: 1-3 people.
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Emerging Team
An emerging team should have two or more senior people who act as partners (usually co-founders) and have secured core capabilities on long term arrangements. Typical team size: 2-4 people.
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Promising Metrics
Metrics are promising when the KPIs are understood and consistently improving. They should be captured in a credible model which maps the path from today to how the business will look at scale.
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Customer Traction
Customer Traction is achieved when the company has laid the foundations for scalability from a technology and marketing perspective and built a habit of strong month-on-month growth, albeit from a small base.
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Rapid Growth
Rapid Growth is achieved when the habit of fast growth is deeply ingrained at a company. The annualised gross-transaction value run rate should be £1-2m growing at 20-30%+ month-on-month.
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Empowered Team
An empowered team should have expertise across all the key functions, include at least one person who is a true partner to the CEO (usually a co-founder), and have the genesis of a strong culture. Some structure will be emerging and the CEO will increasingly be freed from day to day tasks to focus on the business. Typical team size: 5-10 people.
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Scalable Economics
Scaleable economics are achieved when the gross profit over the course of the lifetime of the customer is greater than the cost of acquiring the customer and also that one or more of the marketing channels used has the scope to scale up by 10x without significantly increasing the acquisition cost.
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Tried and tested
“The path forward is an invaluable framework that has helped us structure our thinking and has got us to raising £1 million in 12 months.”
The Path Forward was developed by Forward Partners, a VC platform that invests in the best ideas and brilliant people.
Forward Partners devised The Path Forward to help their founders validate their ideas, build a product, achieve traction, hire a team and raise follow on funding all in the space of 12 months.
Explore GuidesThe Path Forward is a fantastic startup framework for you to utilise as an early stage founder or operator. The framework clearly defines startup creation as being comprised of three steps. The first step of this framework involves understanding customer’s needs.
The second step of the framework focusses on developing a product well and around the needs of its customers.
The final stage of the framework is solely focussed on preparing your startup for rapid growth both from a technology and marketing perspective. This startup framework should then cover all the parts of early stage startup creation. We find that startups that follow this startup framework have much better chances of success than others as it allows founders to know where to focus and when.