Most common mistakes first time entrepreneurs make

Most common mistakes first time entrepreneurs make

Most common mistakes entrepreneurs make

Through my exposure with many startups and established businesses, I could identify 75+ causes of business failures. There are certainly many more causes of business failures.

Although no-one can chronicle/list the complete set of business-failures reasons, especially because there could be causes, those are difficult to identify or difficult to recognize or fathom, correctly.

Very few startups survive and fewer still sustain their growth to become established businesses.

But the saddest part is that, few start up fails even though they had every reason to succeed and they failed due causes – which could have been prevented.

The current breed of VUCA-Startups are the organizations dedicated to creating something disruptive in this phase of extreme uncertainty.

Many of these startups and businesses uses disruptive concept, ideas and methods to change the market and may even upset and impact the organizations considered almost immortal.

These Startup use Lean approach which is both capital efficient and uses innovation as the baseline, which enables successful companies to evolve and adopt the emerging trends with agility.

But disruptive businesses have even more chances of failures.

Common Mistakes Entrepreneurs Make When Starting Up [given randomly, not in any particular sequence]

  • 1.Having delusions of how amazing your idea is, that is Being in love with their own ideas, so much so that, they don't seek objective views and don't listen.
  • 2.Confusing these supposedly good 'ideas' with a good 'opportunity' and a "Sellable Idea"
  • 3.Don't know what they are selling- meaning fail to understand, create, establish and communicate their niche and position among the competitors
  • 4.Not clear about WHY they want to be an entrepreneur, Getting into the entrepreneurial world for the wrong reasons
  • 5.Not vetting/validating the ideas with real end user, Not validating the prototype with enough people
  • 6.Launching ME-Toos assuming that it will sell just like that
  • 7.Not crating crystal clear - Business Value proposition + Customer Value proposition + Employee Value proposition
  • 8.Launching the business too soon - Not have everything planned well
  • 9.Assuming that a product built for one market will adopt on its own in another different one
  • 10.Launching with too Many Partners, all with different ideas and agendas –like what is known as marriage of convenience
  • 11.Not transforming group into a team with single focus
  • 12.Waiting Too Long Before Starting Up
  • 13.Picking the Wrong Partner
  • 14.Setting their prices too high or too low, Overvaluing or Undervaluing The Product
  • 15.Depending Too Much on Others and on outsourced vendors for crucial roles and tasks
  • 16.Not questioning, challenging or evaluating ideas, assumptions and perceptions of their own as well as those of so-called experts
  • 17.Not spending enough time on exploring choices, alternatives and solutions
  • 18. Overcommitting and under-delivering
  • 19.Lacking focus - Not being clear about Business model, revenue model and choosing the wrong model or let default take over automatically
  • 20. Too much planning and too little implementation
  • 21.Not consolidating/utilizing the Strengths areas yet spending time on non-core/lessor-important issues
  • 22. Choosing the wrong investor
  • 23. Taking finance from too many investors with vastly different terms and conditions
  • 24. Not being involved in selling directly and Depending on others/employees for marketing and selling
  • 25. Trying to Do everything themselves, Failing To Enroll and have industry experts as mentors
  • 26. Hiring too quickly when experiencing a sudden and fast growth before ensuring that the increased workload will be there for a long time
  • 27.Not understanding the basic finances and leaving it to their finance employees/accountants
  • 28. Not actively guiding the organization in developing into a very strong and memorable brand
  • 29. Not clear about their values and failure in making these values as part of employees, customers and all other stakeholder's delight
  • 30. Not understanding who their customers are - Not clear about ideal customer profile and segment. And Trying to cover entire market
  • 31.Not asking or paying attention or listening to your real customers, Not testing the market
  • 32. Not making everyone including themselves, accountable and process owner
  • 33. Unwilling to Admit mistakes and faults, correct and move on or change directions
  • 34. Venturing into business only because of the idea of making money quick
  • 35. Spending More Time on Developing to make the product/services perfect for long before going to market to sell
  • 36. Not ensuring the cash flow till business starts becoming self-sustaining
  • 37.Not Getting Support from Others when stuck
  • 38. Employing friends and relatives based on emotional attachments
  • 39. Being afraid of making changes and changing
  • 40. Making hiring decisions based on cost - rather Than selecting employees based on their Talents, competencies and Expertise. Not understanding that the Low-cost employees and consultants are usually low-cost for a reason -- they are more likely to be inexperienced, unskilled or unreliable (or all three)
  • 41.Spending too much money on unimportant and choking the essentials on the guise of saving money Or Spending freely initially and controlling the money later
  • 42. Not identifying the competitors because of assumption that their idea is so unique that they have no competitors or no direct competition
  • 43. Compromising on long term advantages with short term gains
  • 44. Having too little margins, making the business collapse on its own, strangling the critical finance needed for growth
  • 45. Focusing more on products/services than your employees
  • 46. Underestimating cash requirement/funding needed/cost of obvious and sudden necessities
  • 47.Not knowing when to pivot – change path OR CLOSE
  • 48.Failing to take advantage of and use the power of
  • A.The Millennial
  • B.The Technology
  • C.The Internet
  • D.The Social & Professional Media
  • 49. Not focusing on Solving customer's problem but resolving their annoyances [which can never be a great USP]
  • 50. Do not learn enough to understand numbers and their significance
  • 51.Do not factor their own remunerations/income into your financials and business plans
  • 52. Imposing their views even when others are more competent, suppress people who challenges you and your ideas
  • 53. Not actively making your own ideas/processes/products/services obsolete yourself
  • 54. Diverting Entire Profit
  • 55.Letting the cash run out, till there is no buffer
  • 56. Poor management & POOR LEADERSHIP
  • 57.Not surrounding yourself with the best people
  • 58. Poor control of finances
  • 59. Not being responsive to customer's need/complaint in time
  • 60. Weak marketing efforts
  • 61.Ignoring facts, data and feedback
  • 62. Scaling-up too fast
  • 63. Clinging to the wrong idea much longer till it almost kills you
  • 64. Failing to delegate and empower their people
  • 65. Failure to Raise the Necessary Capital on a continuous basis
  • 66. Failure to Utilize the Core Marketing Tools & Proper Sales & Sales Management Tactics
  • 67.Failure to Properly Plan Exit Strategy
  • 68. Failure to Lead the Team from the front
  • 69. Failure to Effectively Brainstorm, improvise and correct on continuous basis, not being adaptable
  • 70. Expecting success right away
  • 71.Not Connecting with employees as well as the customers on a Personal Level
  • 72.Believing that just by Being excited themselves, those around them would be excited automatically
  • 73.Not investing enough in people, marketing and learning
  • 74.Only thinking about Being successful, not prepared for failures
  • 75.Micromanaging for very very long time
  • 76.Not protecting, patenting your intellectual property rights and claims
  • 77.Listening to everyone's opinion
  • 78. Not communicating enough and effectively with the employees, the customers and all other major stakeholders

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