Each year, start-up after start-up fails; countless numbers of them fall apart each year. But, why?
Starting a business is not an easy task, there are plenty of things to think about and decisions to make; the pressure can cause foolish mistakes which can harm a start-up. Although there is no ‘one size fits all’ approach to running your start-up, there are plenty of common mistakes which many new entrepreneurs make. Some of these mistakes can be fatal, so it is best to be clued up about them before launching.
Planning is tedious, but it is a necessary part of launching your start-up. Without a solid business plan, you will find that it will be an uphill struggle when it comes to securing investment funding or loans from financial institutions. A business plan sets out your vision, helps you learn about your industry, find out about competitors operating in your market and, all in all, set out your business on paper.
Undervaluing the Power of Marketing
Marketing, whether it is traditional or digital, is a very important aspect of running your start-up. Successful marketing campaigns can make a company, whereas bad ones or no marketing campaigns at all can break one. There are no rules when it comes to marketing, it depends on your business, but you should have a marketing campaign in some form. For the best results, draw up a marketing plan or hire a marketer to do it for you.
Not Investigating in Security
If you have a physical office, not investigating insecurity is a huge risk which can have a massive financial backlash if your company is the victim of a crime. There are lots of ways which you can easily protect your business, such as integrating remote monitoring systems which will keep an eye on your premises while you are away, and notify the police of any threat.
It is not just physical security either; cyber crime is at an all-time high and investigating in cybersecurity prevention measures is something which all start-up owners need to do.
Doing It Alone
Many start-up entrepreneurs go it alone. Although the start-up is your creation and it can be difficult to bring people into your organization, it is something you should do. There is no need to be a jack or jill of all trades, and by hiring key people such as accountants and marketers to take care of certain aspects of your start-up, you can alleviate a lot of the pressure and help you focus on what is important: running your business.
The fear of failure and being new in the market can cause entrepreneurs to seriously undervalue themselves and their products. This is dangerous because underselling yourself can affect your start-up for years to come. If you price your services very low and then ramp up the price after a short while, this will be off-putting to potential customers and clients.
Recovering from undervaluing your start-up can be a long and painful road, so you should research your market thoroughly before settling on any pricing structure which best reflects the quality of your start-up and product or service.
Start-ups do not have to be huge investments; big spending comes over time as you start to grow. Many start-up entrepreneurs feel that they need to plough all their money into the business from day one, but this is not the case.
There are plenty of inexpensive options available to help your business grow and develop in the early days, during which you should have a strict budget and stick to it.