For many, it’s the dream: Leaving your career and making the move to entrepreneurship. Some of us are even skipping college to get a head start on starting our businesses.
I’ve worked for and consulted with a handful of tech startups, and through both acting as a key decision maker and watching a few others from a bird’s eye view, I’ve found that first-time founders always seem to make the same errors. The consequences of making one of these mistakes could cause a hostile work environment, or even worse, sink your company–sometimes even before it is even able to get off the ground.
Here are the 9 most common mistakes for first-time entrepreneurs, along with what we can do to avoid them:
1. Failing to plan. Many entrepreneurs feel that if they build it, people will come. This isn’t “The Field of Dreams” though. No matter what type of business you're running, to make a business work, you need more than just a product or service. A business requires that you go out there to market and build connections with your target clients.
2. Failing to evaluate co-founders. If your co-founders cannot do their assigned tasks, or even worse, cannot be trusted, then your business is bound for failure. Assess your cofounder the same way you would evaluate any other potential employee. When you find your match, make sure to put them on a vesting schedule with a cliff.
3. Working with friends. Friends are just that. Friends. Business and friendship should not be mixed together, as it the level of respect is lacking. Plus, if anything goes wrong, it could create tension with your personal relationship. Instead, scout out talented people at networking events to add to team.
4. Taking ego to the workplace. Taking ego to the workplace can be quite damaging. In a startup, it is not “My way or the highway." Instead, it is, “How can we all work together for the better good?” As a founder, you are not the most important aspect of the company. The vision of where the company is going, along with company culture is much more important than any of the founding partners.
5. Not testing the market. Without testing the market to see if your product is even a viable option to your potential can lead to months, if not years of wasted time and money. Test and get feedback from the market rapidly, even before starting your business.
6. Trying to capture everyone. When you try to get a net to capture everything in the sea, animals cut through the net and break free. Ultimately, you end up catching nothing. Refine your message, then target certain niches in each campaign.
7. Being a single founder company. When you’re a single founder, you’re overloaded with tasks. You have full responsibility of everything on your shoulders. Instead, learn to delegate. Hand off the responsibility to people who compliment your weaknesses.
8. Putting business expenses on personal credit cards. Many experts say that when you invest, only invest what you can afford to lose. Otherwise, this is the best way to get yourself into a pile of debt, where you may end up filing bankruptcy and losing everything.
9. Having delusions of how amazing your idea is. No business is that amazing. No idea will "change the world." Only hard work and strong execution will. Be humble in your presentations. Do not act as if your idea is revolutionary, because it isn’t.
Now that you are aware of what mistakes to avoid when you're running your business, it's time to focus on what you can do to make it work. There's only one desired outcome from here, and that's the top. We hope we will be seeing you there and discussing how you achieved your success in the near future.