As a seasoned entrepreneur, Michael Zetser has unique insights into what it takes to launch and grow a business. This article will explore a selection of common startup mistakes, sharing strategies to avoid them.
According to a report published by Statista, the main reasons why startups fail are:
- Running out of funds (38%)
- Lack of market need (35%)
Other common startup mistakes include:
- Lack of focus
- Poor hiring choices
- Failure to execute marketing and sales
- A flawed pricing model
- Focusing on investors rather than customers
- Lack of the right co-founders or team
- Spending too much, too soon
- Failure to ask for help
- Failing to invest in social media marketing
Many fledgling founders fail to conduct adequate research into products or services they plan to build. Rather than spending time conducting careful research, many entrepreneurs skip straight from idea to implementation without conducting due diligence into the industry and the competitive landscape they are venturing into.
In terms of mitigating the risk of failure and boosting their chances of business success, there are some very effective steps available to entrepreneurs. First, it is important for entrepreneurs to adjust their mindset. Nobody likes the idea of failure, but it is impossible to create a successful business without taking calculated risks.
Financial expert and founder Deacon Hayes highlights the importance of entrepreneurs making a business plan, pointing out that too many enterprises start out without even a basic plan. Hayes advocates founders mapping out a basic plan (even if it is just one page) that identifies how much the business will cost to operate, how much they anticipate selling, and who would buy their products and why.
It is crucial for business owners to have strong organizational skills too. With dozens of things happening simultaneously, it is important to maintain daily task lists to eliminate the risk of important duties being overlooked.
Entrepreneurs need to know their market inside out, recognizing the target customer they are building for. For entrepreneurs with a technical background, writing code may come a great deal easier than dealing with members of the public. However, without human feedback, it is impossible for the founder to gauge whether or not they are on the right track. It is important to appreciate that a great product does not necessarily translate to a successful business, with many companies falling into the trap of focusing on markets that are simply too small to sustain a big business.
Another common mistake made by entrepreneurs is trying to do everything themselves. It can be challenging for business leaders to relinquish responsibilities and control over a business built with their blood, sweat, and tears. However, the key to scaling any enterprise, and ultimately achieving business success, is building strong teams of talented, incentivized individuals who can be trusted with tasks. Founders need to cover a variety of different skillsets and backgrounds as their business expands, recognizing where open roles require candidates with specialist skills.
In conclusion, by avoiding these common mistakes, start-ups can get off to the best start possible and will have the greatest chance of success.