It is almost impossible for tech startups not to make conspicuous mistakes which can be of detriment to the intending company. Beyond the stereotype of getting funding and other challenges that startups face, we highlight the non-financial mistakes that can bring a startup to a premature doom.
1) Going On A Lone Journey:
Some entrepreneurs are so in love with themselves (narcissistic) that they insist on answering every question and making every decision. That’s not only impossible but also counterproductive. Effective entrepreneurs team with or employ people who can provide the answers directly, pertinent to their particular area of expertise.
Building a powerful business will be very difficult if you are the only one involved. Of course, the cost of hiring even one administrative assistant, sales representative or entry-level employee can be very intimidating and hair-raising due to fear of taking up a large chunk of your profits. The solution: Ensure there’s sufficient margin in your budget to allow you to get other individuals.
2) Failure To Plan Before Executing:
Many startups don’t deem it fit to carry out proper planning. Having a plan for plan’s sake is a fast lane to doom, understanding the value of and need for a strategic plan is a great place to start, but just wanting something, isn’t enough. If it were, we’d all be famous actors in Hollywood. Developing a strategic plan takes discipline, foresight, and a lot of honesty.
3) Hiring The Wrong Set Of People:
Hiring people you know instead of the right person for the job can cost you a lot in the long run. When you hire the wrong person, you’ll likely find yourself looking for ways to reassign the employee or working tirelessly to fit him or her into the organization in some way. Rather than simply letting the employee go, you’ll owe it to him or her to spend time and money on training and ongoing performance review. Eventually, he or she may become an adequate employee for your business, but there’s also a chance that he or she won’t work out.
4)Creating Something Nobody Wants:
This is the greatest mistake a startup can make, more often than not, tech startups fail to design user experience, try product thinking to discern whether the experience is worth using. “Customers don’t care how much time something takes to build. They care only if it serves their needs.” ―Eric Ries. The key to overcoming this obstacle is doing your research first, knowing your market, your competitors and understanding your customers. The very first step that cannot be skipped in any business is to study the PMF (product-market fit) and see if the business would be feasible or not. This is not charity, this is business.
5) Lack Of Focus:
Most people need to realize that focusing on short-term objectives at the expense of long-term success can cause the failure of such a startup. A short-term focused strategy is like running with your head down and your sight on just a couple of meters in front of you. You might run fast and watch out where you step but you don’t know where you are going and what the road will bring.
6) Founding a Startup With People Less Passionate Than Yourself:
When you are willing to put every dollar and sweat you have towards a startup, make sure the co-founders are willing too. If not, that will apparently cause the failure of the startup. And when those problems did inevitably arise, not dealing with them rapidly enough will surely end your dream of building a company. One of the most important aspects of being a successful entrepreneur is surrounding yourself with people smarter than you. Don’t let your ego get in the way.
7) Choosing the wrong location:
The success of any business is about 40% determined by its location. A startup location strategy should conform with, and be part of, its overall corporate strategy. Some of the basic requirements a company must consider are; Size, Traffic, Total cost, Population, infrastructure, and labour. A startup that is located in a favourable location will benefit from the exposure and foot traffic of other neighbourhood businesses.
Considering A Start-up As Merely A Way To Make Money:
Allow me to refresh your memory about one of Henry Ford’s quotes “A business that makes nothing but money is a poor business.” Often times tech startups tend to focus more on making money which is, of course, not a terrible idea but here is where priority needs to be set, a startup must create useful service or a product, it must have a mission that is understandable to the target audience and your employees. An inspiring vision is what distinguishes a successful startup from another money-making tool.
9) Lack Of Patience:
In order to build a successful startup, you have to hustle and be somewhat of a hard-charger. According to Chris Myers, Co-Founder & CEO of BodeTree, a financial management solution for organizations that serve small business, avoid the “ready, fire, aim” syndrome as a startup. This “ready, aim, fire” syndrome is all too common among tech startups, and while sometimes it leads to rapid iteration and growth, more often than not it results in problems. Patience is like any other hard-earned discipline: The more we practice it, the more patient we become.
10) Asking Too Many People For Advice:
The problem here is not getting bad advice but it’s that asking too many different people for their takes in the vain hope one of them will say something groundbreaking. But that rarely happens. So the end result leads to wasted time and put off making any decision at all.