3 Mistakes You Need to Avoid When Starting Up
The school of hard knocks may be one of the world's best teachers, but it's certainly not the most fun way to learn.
Failure may be an inevitable part of starting up, but that doesn't mean it isn't sometimes preferable for the mistakes to be other people's so you can learn from them by proxy rather than personal experience.
That's the truth that motivated serial entrepreneur David Hauser to ask around among his fellow founders and round up what they wish they had known before starting their companies on his blog.
Hauser managed to get responses from an impressive 25 founders, all of which are worth checking out, but here are a few key examples of early screw-ups you would love to avoid:
1. Guessing on price.
"I wish I knew how to price test," says Neil Patel, co-founder of Web analytics start-up Crazy Egg. "When we first released the product we based pricing based off of what we wanted to charge, versus optimizing price to achieve maximum revenue and profitability. At one point in time our customer base requested a lower pricing option. We did it because there was a high demand for it. Although it increased the total number of signups, it decreased our overall revenue. If we knew about price testing during that time, we wouldn't have made this big mistake."
Mike Arsenault, co-founder of Rejoiner, a tool for online retailers, agrees: "Don't guess at price. So much is dictated by the way you price your product and many first-time founders default to what they 'think' customers are willing to pay for it (myself included). Focus on the value you are creating for your customers, not on what it costs you to deliver your product or service."
2. Burning yourself out.
"My business partner, Steve Bristol, and I really used to put in major hours the first years of the company. We were working 80+ a week. After working ourselves to a point of being burned out we realized that if we put in 40 x 2 hours the company didn’t move forward 2x faster. In fact those extra 40 hours were less productive than the first 40 hours. The reality is you'll never be 'done' with your work, you'll never finish all the tasks, build all the features and have the perfect design. At the end of the day, around 4 p.m., we close our laptops and go home. Never forget work is here to enable your personal life fruitful," writes Allan Branch, co-founder of LessAccounting.
3. Expecting only to win.
Several founders stressed that starting up isn't all ping pongs tables and cool ideas. Jason Traff, founder of car insurance comparison start-up Leaky explains: "Often when start-ups are portrayed in movies or TV shows, it's a bunch of 20-somethings playing foosball all day and partying all night. What they rarely show are the lows that accompany those highs. Never in my life have I been rejected as frequently or as vehemently as I have for Leaky. After all of the countless rejections, the scrapping to make payroll, and the cease-and-desist letters from insurance companies, what I learned was that you need fortitude to look past the temporary highs and lows to know that no gain or setback is ever permanent."
"It's important for founders to know that when starting a company, they are about to embark on an emotional roller coaster ride. Managing your emotional state will become so hard but so important. When you hit a low point, remind yourself that it is just a bump in the road," says Gautam Gupta, co-founder of healthy snack start-up NatureBox.
Check out the super interesting complete post for the rest of the lessons the founders learned the hard way.
For all the experienced founders out there, how would you answer this question: What's the one thing you wish you'd known starting out?