Business Mistakes to Avoid When Starting Out
According to the U.S. Bureau of Labour Statistics, 20% of new businesses fail during the first two years of operation. Furthermore, half of all businesses do not survive past their fifth year. This brings up the question ‘how do you successfully launch and run your business’?
Below are some of the biggest mistakes that start-ups make so you can avoid them when starting out.
Not having a business plan
A lot of businesses start out their operations without a basic plan. Starting a business without a plan is like setting up yourself to fail. Any startup should map out a business plan, even if it is just one page. The plan should include how much it costs to operate, how much they anticipate selling, who would buy their product and why.
No Business Organization
Like you may have all heard before ‘organization is key’. Running a small business is no walk in the park as dozens of things will be happening all at once. This is where organization comes in. Having a daily task list helps with organizing how the day goes. Also, you could arrange your task list according to their priority. This will help get the most important things done in a quick and productive manner.
No legal structure and Business Registration
Another mistake start-ups make is not registering their business, picking the right business entity or protecting their intellectual property. These three areas are very important to starting a business the right way. Most business that start out without doing these often spend a lot of time and money to correct it.
Scared of Failure
According to Audrey Darrow, ‘the biggest mistake you can make is to be afraid of failure’. Failure is key to your success and jumping into your fear is very positive for your future business. How you pick up after failure and learn from your mistakes is the key to great success.
Entrepreneurs always make the mistake of thinking they are all alone. This makes them try to operate independently without surrounding themselves with wise counsel. Do not try to run a new business by yourself. Instead, find and onboard trustworthy seasoned advisors to discuss your ideas, strategy, challenges, and progress. Incentivize about four to six people to join your company as advisors to receive continuous feedback so that fewer mistakes will occur.
Partnering with the Wrong Investors
Before starting out, it is very important to view your investors as more than just financial backers. This is because these individuals place their confidence in the business’s potential without having a proof of concept presented to them. A company’s first set of investors will make or break it.
The bottom-line is that
A successful startup is not built by a single person. Surround yourself with subject matter experts and mentors you can lean on and learn from. Although there are several startup mistakes you will want to avoid while building your business, occasional mistakes are inevitable, and manage your expectations accordingly.
Do not be afraid to fail; instead, learn from your mistakes and pivot your business model as needed. Test new ideas and acquire feedback so you can tweak your product to better meet customers’ needs.