Importance of the startups

This section of the review is of special importance for the final part of the report, i.e. practical recommendation of integration of cloud consulting services in Russia. It will be necessary to understand whether to implement cloud consulting services as a part of IBM, relying on its immense experience, strong and trustworthy reputation or launch a separate company, i.e. startup supported by IBM.

Frequently, implementation of new revolutionary technologies or creating new products or markets is related to startup companies. Startup may be called the organization to create a new product or service under conditions of high uncertainty (Ries, 2011). There is no universal approach to the description of the development of start-ups. Different models share the stages of growth, based on the founders adopted decisions objectives sought by the company, or to attract external funding.

It might crucial for development of this project to understand, how startups become a stable company. Stephen Blank in his book "Four Steps to inspiration" and Eric Ries in “Lean Sturtup” analyzed great number of start-ups and came up with the sequence of actions that was discerned in the way of the most successful start-ups. Primarily, the strategy of the company should be based on the understanding the needs of customers. This model describes four phases, during which the startup is converted into a stable company:

"Identification of consumers," during which the startup conjecture about how his product solves the problem of potential customers.

"The verification of consumers” stage of testing hypotheses and preparation of the sales plan, marketing strategy, search early for following companies. If unsuccessful at this point, a startup is returned to the identification of their customers.

"Attracting consumers" after confirming the usefulness of the product of the company. Startup goes to product sales and marketing investment.

"Creation of the company" - the ultimate goal of a startup, creating a formal structure of the company and business processes for further development.

These steps can help to adjust direction of strategy, while working with the high level of uncertainty. During our research, we address mainly to the first phase and partly to the second.

In respect to financing, the existing practice of venture capital investment involves several stages of financing start-ups, each of which the company attracted sufficient funds to support the growth and reach the next round of investment. Since the investor receives income from the increase in the value of its stake in the company, the company is supposed to fold growth between investment rounds making attractive for the new investor. Another step is to attract funding for an initial public offering, IPO - placing the company's shares on the stock exchange. An IPO usually becomes the main purpose of a startup in the later stages of development.

To conclude, startup is a good way to suggest Russian business a new service that had not been suggested elsewhere in CIS region before. It seems rational to launch startup for providing cloud consulting services. However, there are many potential drawbacks, such as strong need for financing, risks of weak acceptance of new type of consulting. Moreover, Russian businessmen and managers tend to have in average low level of trust for new technologies and services. The latter mention disadvantage is described in the next section.

Date: 2015-12-18; view: 806