Startups in today’s fast-paced business environment face various risks that can make or break a company’s success. Financial, market, competitive, operational, and regulatory risks are just a few challenges that startups must navigate to succeed.
Braeden Lichti, founder and CEO of BWL Investments, is an excellent example of an entrepreneur who has found enormous success as a public market venture capitalist. Lichti is a seasoned expert in helping build and find startups poised for growth. H has a proven track record of funding, restructuring, and launching companies that have gone on to be publicly traded or acquired.
Lichti, who is also the co-founder and chairman of ELEVAI Labs Inc. and co-founder of Health Logic Interactive Inc. and manages NorthStrive Companies Inc, shared his journey with me and offered valuable insights into the risks that arise at each stage of a startup’s development, as well as how to navigate them successfully.
Lichti shares, “One of the biggest threats to a startups success is financial risk. Not being able to raise capital at the right time and also not knowing your numbers. From time to time, we meet founders that underestimate this and have not taken the time to plan ahead. Startups Need More Than Money to Succeed — They Need Patient and Smart Money, at the right stages of growth. .”
He also explained, “Competitive risk is also a significant concern for startups, as they may be up companies that can develop faster, better capitalized or might have built a stronger IP moat. Operational risk is another concern, infrastructure needs to be in place and finding the right people is extremely difficult as a company needs experienced team members to help to scale and manage operations as business grows. Regulatory risks are also a major concern for companies and investors that is not often talked about, particularly those that graduate to the public markets. To mitigate risks, startups should establish and follow proper corporate governance very early in the game. It also helps to have experienced investors and advisors in place to communicate with regularly. Lastly, companies must make earnest decisions on choosing the right legal and compliance professionals for your business. Selecting poorly in this department can be detrimental to a companies long term success.
In addition to these risks, startups also face the risk of trying to time the market. Foreseeing whether a market will be receptive to a given product or service can be challenging and avoided. Even the most well-researched company plan may fail to anticipate sudden shifts in market conditions. The risks associated with trying to time the market include missed opportunities, lack of differentiation, and high competition.
As a whole, startups confront various risks that affect their eventual success. To maximize their chances of success, entrepreneurs must be aware of these uncertainties and take measures to mitigate them.
Lichti’s investment history and company portfolio have benefited from his ability to manage these risks and learn from his failures. Many startups and entrepreneurs have benefited from his aggressive yet empathetic approach to taking their ideas from proof of concept to fully operational global enterprises.
In the digital era, startups face many risks that can significantly impact their success. Entrepreneurs like Braeden Lichti, founder & CEO of BWL Investments, have found success by being aware of these risks and taking a proactive approach to managing them. By communicating with legal and compliance professionals, developing internal policies and procedures, and staying up-to-date on applicable laws and regulations, startups can increase their chances of success.
As the industry continues to evolve, it’s evident that success will require a great amount of hard work and initiative from those who wish to remain at the forefront. Nevertheless, one thing is sure, no matter how the industry shifts, Braeden Lichti plans to be leading the charge, staying ahead of the game.
