Five Traits Successful Startups Share

In 1929, Alexander Fleming, who worked at St Mary’s Hospital in London, published a paper describing how a mould secreted a substance that killed bacteria. He named the substance penicillin. Then almost nothing happened.

Fleming was a bacteriologist, not a chemist. He had left the job of purifying the substance to his assistants; they did not succeed, and both moved on to other work. Penicillin research at St Mary’s ended that same year. For a decade, the paper all but faded from memory.

In 1939, at the Sir William Dunn School of Pathology in Oxford, the biochemist Ernst Chain put the paper in front of his head of department, Howard Florey. The team Florey assembled was of a kind almost unheard of in the Britain of the day: pathologists, biochemists, bacteriologists, doctors and the young Norman Heatley, known for his practical ingenuity. Each took on a different part of the problem.

Money was tight. The Medical Research Council put up £250 to get the project going; the Rockefeller Foundation supported it with $5,000 a year. Because of the war, laboratory equipment was scarce. To grow the mould over a large surface, Heatley designed ceramic vessels inspired by hospital bedpans and had them made by a potter in Staffordshire. Two women were hired at £2 a week each to run production. The Oxford lab became the world’s first penicillin factory.

In February 1941, the drug was tried for the first time on a patient fighting for his life against a severe infection: Albert Alexander, a 43-year-old police officer. Within a few days his fever dropped and his wounds began to heal. Then the penicillin ran out. The team tried to recover the drug from the patient’s urine, but it was not enough. Alexander died on 15 March.

The drug worked. What was missing was scale. In June 1941, Florey and Heatley flew to the United States. At an agricultural research laboratory in Peoria, Illinois, corn steep liquor was added to the growth medium on Andrew Moyer’s suggestion, and the yield rose tenfold. Within a few years, penicillin went from a laboratory miracle to an industrial product.

The idea was Fleming’s; the venture was a team’s

In 1945 the Nobel Prize in Medicine was shared between Fleming, Florey and Chain. Heatley’s contribution was only recognised in 1990, when the University of Oxford awarded him the first honorary doctorate of medicine in its history given to someone from outside medicine.

The penicillin story is more instructive than many lists about successful startups, because it shows the same idea going nowhere for ten years and then changing the world within a few. The difference was not in the idea but in the structure built around it. The five parts of that structure match the five traits most often seen in successful startups today.

Five traits successful startups share

1. A team whose skills complement one another

Fleming could not purify the substance on his own. In the Oxford team, by contrast, each discipline unlocked a different door. Successful startups likewise bring together complementary skills rather than similar voices: a technically strong team needs someone who understands sales and marketing; an experienced team needs a fresh pair of eyes. People who think alike make the same mistakes together.

2. The right idea, without falling in love with it

The Oxford team did not start with a single candidate but with three micro-organisms that produced antibacterial substances, and pursued the most promising one. Years later, Chain would recall that when they started, it had not even occurred to them that penicillin might be used in the clinic. Successful startups aim at a big problem but stay flexible about the solution; if the data demands it, they change direction.

3. Planned growth

Albert Alexander’s story shows how a product that works can still lose because of insufficient capacity. After that experience, Florey focused on child patients who could be treated with smaller doses and looked for ways to expand capacity. A startup that cannot meet demand loses the customers it has won. Growth has to be planned together with the supply chain, infrastructure and people.

4. Financial efficiency

A team that started with £250 and produced penicillin in bedpan-shaped vessels had to know where every pound would do the most good. The same goes for early-stage startups: burning through capital before the product is validated leaves even the best idea stranded halfway. Successful startups spend according to their stage and, when raising money, explain clearly what it will be used for.

5. Handing over or exiting at the right time

Florey and Heatley realised they could not produce the quantities needed for clinical trials in Oxford, and looked for a way to move production to American laboratories and companies that could. For startups, an "exit" is the same kind of decision: selling at the right valuation, merging, or accepting failure early and closing before the losses grow. The story also carries a warning: although they had agreed to publish jointly, Moyer left Heatley’s name off when he published the results. Handovers need clear agreements in writing.

Survivorship bias

Every "what successful startups have in common" list hides a trap. During the Second World War, the mathematician Abraham Wald, who worked in the Statistical Research Group at Columbia University, wrote up methods in 1943 for estimating which parts of an aircraft were most vulnerable from the damage on planes returning from missions. The difficulty was this: the only data available came from the planes that made it back. The ones that were shot down could never be measured.

This is called survivorship bias. Look only at successful companies and "a strong team" or "passion" looks like the secret of success, yet many startups that failed had these traits too. When you read success lists, you have to look at the ones that closed as well. That is exactly what the Startup Graveyard is for.

Look at the word itself, too. The Turkish word for team, "ekip", came from the French "équipe", which goes back to the Old French verb "esquiper", to fit out a ship. Its root is most likely the Old Norse "skipa": to equip a ship, to man it with a crew. "Skip" means ship. A team, in its original sense, is the people who board the same ship.

A final word

In a speech in Lille on 7 December 1854, Louis Pasteur said:

"Dans les champs de l'observation le hasard ne favorise que les esprits préparés." In the fields of observation, chance favours only the prepared mind.

Fleming’s luck was a mould that landed in a lab dish. What turned it into a medicine was a prepared team, a small budget and vessels inspired by bedpans. When luck knocks on your door, is your team ready to answer?