Starting your own business can be both rewarding and challenging at the same time. The joy of starting something on your own, something that impacts the lives of others, is unparalleled.
However, the road to success is definitely not an easy one. There can be a zillion different things that can go wrong. And innumerable hurdles might keep coming your way. A study found that the failure rate of companies, even after five years, is 50 percent.
The good news is that you can still learn effective entrepreneurial skills from the mistakes of others. Here are some of the most common mistakes that startups make that you should avoid.
1. Not conducting adequate market research
You might have a brilliant product idea and can't wait to make it a reality. However, you need to conduct adequate market research to understand whether at all there's a market for it. No matter how brilliant your idea might be, if it doesn't solve people's problems it can't be successful.
I've seen a lot of startups going all guns blazing into the market with a product that no one wants. Most of them are gone from the market within a year of their launch. Failure to understand if there's adequate demand for your product can be detrimental to your business.
Lisa Stone, co-founder and CEO of BlogHer, says she started her company by listening to women bloggers. They figured out what they wanted and then came up with the idea of their business to support women bloggers. What started off with 300 bloggers has now reached 14 million people.
2. Being myopic about end goals
I've come across a lot of startup entrepreneurs who equate their business' success with getting funded. Most of the time, this arises from the fact that startups getting big investments make headlines. This creates a false sense of end goals.
As an entrepreneur, your objective should be to create products that are valuable to your target audiences. Big investments are definitely necessary to keep you going.
However, you shouldn't become complacent upon securing funding. Instead, you need to continue focusing on your end objective of actually making your business successful.
One of the most common misconceptions about startups is that once you get some initial success, the rest is easy. Eric Rea, CEO and co-founder of Podium, says that this is entirely untrue. He says the company's growth so far is because they've never lost sight of their end goals. Creating something that people truly care about and acquiring customers.
3. Not delegating tasks to team members
A successful entrepreneur is one who is self-aware. This means that you should be able to logically assess your strengths and shortcomings. You might be tempted to do all of the work entirely by yourself. However, you need to understand that you might not have the skills required for all kinds of tasks.
In such cases, you must learn to let go and delegate those tasks to people who are better suited for them. Ultimately, if you really want to succeed, you must learn to work as a team. Not only will you gain from other people's skills and expertise but also won't run the risk of burning out.
Steve Jobs once said that the first ten employees of a startup ultimately determine its success. Recent research shows that a startup founders employee selection is crucial to business success.
You definitely need to have a basic knowledge of all aspects of your business. However, you need to hire the right people for managing the aspects in which you're not proficient.
Being an entrepreneur is no easy job. It requires passion, perseverance, people management skills, and a great deal of patience. The most important thing you need to remember is that everything takes a certain time to bear fruits.
Don't be in a hurry to see results and if you're seeing them, don't be in a hurry to expand. In business, slow isn't bad as long as you're steadily making progress.
Can you think of any other common mistakes that startups make? Let me know in the comments below.