Your startup is like a Formula One team.

Watching the excitement building for the start of the 2016 Formula One season got me thinking and making comparisons between Formula One and my other passion, Startups.

Watching the way teams go about a race weekend has many similarities to the daily challenges of running a startup. You also see the impact of varying levels of funding and technical ability, together with constant need to manage PR and the expectations of fans.

Here are some F1 insights that you can apply to your startup.

Constant improvement

Formula 1 is a sport where fractions of a second split 1st from 2nd place, the pursuit of technical excellence through constant improvement is engrained in the DNA of each team.

The cycle of driver feedback and engineering analysis means that a car can have completely different dynamics from practice to qualifying.

The best startups adopt the pursuit of constant improvement from day one, gaining feedback through testing, measuring and iterating their offering. In a startup you can’t stay still and in competitive markets the smallest point of improvement can be the difference between getting the contract that makes you or the down round that breaks you.

Regulations

Regulations in Formula one are under constant debate and shape everything from the performance of the cars to the way the teams execute their strategy. The best teams in Formula One are those who interpret and push the boundaries of the regulations, without going too far.

In the startup world we operate within a complex framework of ever evolving regulations. These regulations govern the way we employ our staff, build our products, raise our funding and enjoy the funds we receive when we exit our companies.

Successful startups understand that there are many ways to deal with regulations, we often see startups incorporating in countries that better suit their business model, or outsourcing their development teams. These are strategy plays that lessen the strangle hold of regulation on the business to optimise their chance of success.

In Formula One we see the big teams use their clout to influence the way that the FIA structure the regulations. At almost every race we see the team principles and FIA heavyweights deep in discussion after new regulations aren’t well received and impact negatively on the sport (think new elimination qualifying rules).

It’s the same for heavyweight startups like Atlassian lobbying governments to ensure that regulations encourage investment and facilitate innovation. Regulation sets an even playing field, however it shouldn’t determine the outcome of the game.

Big Data

A Formula One car has 400 sensors measuring everything from tire temperatures to breaking force and energy recovery. The data collected by these sensors has brought Formula One to the forefront of big data and the science of its interpretation. Drivers like Lewis Hamilton will study the data after every race looking for trends, and seeking insight into areas of improvement and adjustment in strategy.

The technology available to startups today allows them to place sensors in every aspects of their business. By using cloud software businesses can track and report on the performance of everything from customer service response times to marketing effectiveness and financial stability.

Startups need to closely monitor their data to ensure that precious resources are never wasted and they are constantly adjusting the way they execute based on their real time position.

Formula One teams are also experts in analysing data from external sources like the weather. Most F1 teams employ a meteorologist to track weather conditions and predict the way weather will impact their race day strategy.

Startups need to be tapping into the wealth of external data sources available to them to predict external storms, everything from changing economic conditions to emerging technologies can impact the strategy of a startup.

Collaboration

Formula One is about logistics and collaboration as much as winning races. The best teams operate in meticulous harmony with everyone understanding the role they play, and how communication amongst the team can make or break a race. Behind the drivers and race engineers’ is an army of support staff back at the factory making sure 50 tonnes of expensive equipment travels safely between races, and ensuring that every team member clearly understands what to do next.

Many startups quickly become global enterprises, operating across countries, time zones and languages. Without effective collaboration a startup team can quickly lose alignment, leading to confusion, wastage and frustration.

Collaboration is about ensuring that all members of the team have access to the right information, at the right time with the right context. Tools like Google Apps are affordable and make effective collaboration achievable for every startup.

At Accodex we have a strong focus on developing our collaboration tools to ensure that everyone in the team has access to the information that they require to do their job effectively and efficiently.

Strategy

The final and most important synergy startups have with F1 is strategy. As I watched the drivers being interviewed on arrival at the track I noticed that each one had a clear strategy for approaching the day and the race.

Some drivers already knew they had no chance in winning, instead choosing to conserve their engines and mechanical resources for the next race.

We also see how a perfect qualification and front row can quickly become redundant after spinning the wheels off the start. Suddenly race strategy needs to be quickly revised based on current conditions.

A startup is no different, everyday we take calculated risks and execute our strategy based on the current conditions that we operate in. Startups are high risk and experimental in nature, so the ability to quickly adjust strategy is vital to success.

I often see startups land a big investment only to find themselves spinning the wheels because they lack the right team or systems to execute their strategy.

Then we see the dark horses from the middle of the field, who through efficient execution of strategy can make the most of a racing incident and take the points.

The questions is, which Formula One team is your Startup?