Avoid These 6 Mistakes When Starting a Successful Business
Making mistakes is essential — this is actually what makes us humans and not robots; furthermore, there’s no other way to improve other than learning from these very mistakes. But why make them yourself instead of learning from predecessors’ experiences? Based on my experience, I would like to highlight major pitfalls that were on the way before finding a footing for my company. So, unless you’re a hardcore “no pain — no gain” slogan proponent, buckle up and see what I’d like you to avoid at any cost.
1) Business plan < belief
Having a great idea is a must. The moment you decide to enter the market, you realize that it’s not enough to copy/paste someone’s product and do the same service with no feasible change, hoping to succeed. It simply doesn’t work that way — the competition spurs to have a different approach, and the reason why you’re better than rivals should appear in consumers’ minds right away.
But like everything else, this should be taken in moderation: don’t let dreams drag your business plan by the wayside. “Money to spare needs good care” sums up the approach when you need a solid plan on how to make a future company turn a profit. There’s no need to explain how careful you should be when putting your own money, but investors’ money is no less important.
Prepare to be bombarded with questions by potential investors — they’re putting their money at risk, after all. No matter how hard you believe in your product, this confidence should never override the actual business plan, so make sure it is ready to address all the market goals and deliver upon them in detail and convincingly.
2) Listening to customers instead of spreadsheets
Feedback is important. More so, it’s crucial for you to know what the customers want and to pursue that goal, but this can also be misleading in a way.
The thing is, everybody loves free stuff. And the customer is always willing to pay the lowest price for the maximum value, thus it’s important to keep their concerns away from math. There’s nothing wrong with it; just remember, even the most loyal customers are far from viewing products from your perspective — they’ve got their own problems to worry about.
Make sure that the end-product pricing policy has every part of the equation: salaries, rent, taxes, and all the other things you have to pay for. The business isn’t a great venue for altruism, so even if you want to please your customers, it should be a well-planned affair rather than a spontaneous giveaway.
3) Risking a family member’s retirement fund
Imagine fast-paced business as a racing car. And what better insurance policy other than an airbag can it be? In the business world, it could be the bank or side investors, but very often it’s your family member’s money that you borrowed it from. Both sources mean certain duties, but risking relative’s money adds an extra layer of responsibility.
And that’s a tricky part. From my experience, I would not recommend taking money that was meant to be a retirement fund or savings for future education. “Spare money” sounds absurd, but if a relative has a certain amount of unused cash — don’t mind using this opportunity, in the end, no other group of people has as much faith as people you love and care about. Just don’t forget to introduce all the risks associated with this affair: “money to lose” is just a term that doesn’t have to be taken literally.
4) The right time to launch
No marketing forecast can tell you the exact time to launch. Even Apple “managed” to misjudge their “niche” potential for iPhones — it became outdated so fast that every rendered picture for the XS model had a dark background just to hide it was still there.
The modern market is so fluid that sometimes it’s only your sixth sense can predict demands and trends. Trusting your gut is on par with business analysis and is quite an exercise in itself that it deserves to be an Olympic discipline. So what’s the takeaway?
Well, just try to do things beforehand. Don’t be afraid — you’re unlikely to deliver the product too fast for two reasons:
- breakthrough products usually spawn once in a blue moon;
- tons of little factors that you had no clue about are always keeping the production back.
So, here’s a tip: don’t be too late with the release date.
5) Equating personal experience with business expertise
No matter whose experience it is, don’t rush to try it on your business if it’s from another area. It often happens that after reaching success in doing a workout, some people think they can reach the same heights in every activity and open their own gyms; but the truth is, such background is irrelevant and inapplicable. Determination and the will to push forward are great qualities, but the lack of actual business expertise can’t be compensated by a diverse life background.
“Not every great coach is a great player” pretty much sums up the idea: previous experience can’t be matched when dealing with business routine. I’ve encountered many cases when a good mechanic or chef started their businesses but failed to deliver due to not having financial prowess. And although knowing how to make dinner is great for a restaurant executive, that’s a small fraction of what should be handled: paying bills, competing with rivals, taking care of the estate, etc. This all sucks the emotions dry and is stressful, to say the least.
It’s important to move forward, especially if an employee has reached a professional ceiling, but think twice before handling business on your own — make sure you’ve got an “octopus” perk of managing multiple problems at the same time.
6) “Bolivar cannot carry double”
Focus on a single entity to enact the best ideas there. Although it contradicts the previous statement in a way, you need to decide which goal is a primary one. Many people work just to get enough money for launching their own business, and there’s nothing bad about it — not everyone has a daddy or a relative who will hand them a “small loan of a million dollars.” But you will come to a point when the split up is imminent — either you dedicate full time to the passion of your life or just give up this idea.
The human brain is like an engine that needs fuel. And the last thing you want to do is disperse some of its potential towards side projects that are not as important to you. It’s hard to generate and introduce the best ideas when you work elsewhere, so make sure you save all of your potential for the business you truly love.
Getting it off the ground is like making a leap — the body should accumulate all the power. So when the time is right, be ready to abandon your secondary job and put all the love and passion into your business.
Conclusion
Remember never to shy away from mistakes — the fear of making them is often more detrimental than the potential flaws. Entrepreneurship is the home of the brave and the will to move forward is a must-have perk to succeed, that’s why things like a business plan, the right timing, and focusing on the actual goals make up the biggest priorities before launching a business. The basic economy and common sense should always override emotional aspects; if you feel any doubts before making a business decision, take a deep breath and think twice about whether it benefits your lovely company or not.
