Sadly, most startups fail, it’s just how things work nowadays. In some cases, the entrepreneurs have a great idea in mind, but the business itself still collapses. Why?
Well, there could be a couple of reasons, and some of them, businessmen can’t foresee while others do have a few red flags before they come down crushing great businesses to pieces.
In this blog post, we are going to talk about those particular red flags and mistakes that we’ve mapped out and we wish to help all struggling startups with this list.
1. Giving up too soon
This is probably the number one mistake founders often make. Instead of pushing through hardship and tapping into set-aside resources, startup owners tend to pull out way too soon, just after hitting the first few roadblocks. Being resilient and enduring hardship are the keys to success and young entrepreneurs will have to learn how to take “no” for an answer in the early stages. Having a positive mindset and keeping on hustling can mean the difference between a failed company and a successful one.
2. Act on the idea
Great startup ideas fall apart because the founders aren’t ready to realize said ideas. A good pitch or an idea can’t build an enterprise, only hard work can. Without action, ideas are just that – ideas. They are worth nothing. The people behind those ideas are the ones that matter, they are the engines who work tirelessly to execute that idea.
3. Too fast, too big, to soon
Whenever you see a startup coming out with a handful of different products and MVPs, you can tell that it won’t last long. A lot of newcomer entrepreneurs find it hard to create the minimum viable product, and thus, they lose valuable time and resources in the process. And if the ideas are too grandiose, without the necessary demand, the startup can throw away both the product and the office keys in no time.
Keeping it simple and basic should be the focal point in the beginning. Later on, when you already have something that you can refer to as an “established brand”, you can launch new products and services. Just be patient, give your audience the time they need to get used to your brand.
4. Ineffective marketing strategies
Trust us, we’ve seen a lot of this. In today’s stiff competition, the vast majority of businesses would struggle to survive without a good marketing plan, let alone small startups that still haven’t established themselves. Marketing strategy is also an important factor in defining your business model.
Marketing should be a cornerstone of a successful business and having effective strategies to acquire customers and raising brand awareness should be high on every startup founder’s priority list. By not creating a marketing budget or strategy, fresh entrepreneurs are sabotaging their own efforts and product success.
How can you give value to somebody if they can’t reach you? Simple as that.
5. The absence of mentors
Not willing to take advice is a huge red flag and one of the best indicators that a startup will eventually go down the drain.
It’s one thing to ignore criticism that’s not constructive but it’s damaging to ignore the wise words of those entrepreneurs who have already faced the obstacles you are still looking forward to. By listening more to the feedback you get, you can learn a lot, evade possible pitfalls and can even change company direction when you still can.
6. Not defining their audience
Another part where startups fail is not setting up a proper target audience. Casting a net that is too wide can end up causing more trouble than help. Knowing your niche and potential customers will make locating them and marketing to them easier.
Narrow down at first, both in terms of location and demography. Reach out just to a smaller circle of people then gradually widen the circle as you gain more ground and recognition.
7. Not having the right team
Having the wrong people as partners or in your workforce can not only hinder your progress but can actually cause the end of your otherwise great business idea.
Make sure to find the people who are on the same page as you, having similar goals and mindset. They don’t have to be clones or exact replicas of you, look for characteristics you want in a team member (that you may lack, or need to work on), but still, look for people that share similar values as you.
On the other hand, make sure that you’re not selfish. As they might not be founders and direct business partners, you will need to understand that these people won’t be ready to cater to all your needs whenever or wherever, especially if you aren’t able to pay them that well at first. Respect their privacy and set up some ground rules in this regard.
Often investors don’t give money to the idea itself, but to the team, their knowledge, chemistry, and passion for work and growth.
8. Focusing on the wrong issues
A lot of young entrepreneurs tend to focus on solving complex problems, conveying grandiose ideas, and fail terribly because of one thing: In most cases, people want simple solutions for solving simple problems.
While having a defined niche of people who you market for is a good idea, you should always keep in mind that simplicity and simple solutions are things that everybody gravitates to.
So instead of diving head-first into changing the course of humanity, start with smaller steps, and when you have the resources and the recognition, then start something that has the potential to push you to the forefront of the industry.
9. They don’t pivot
The biggest mistake founders make is being in love with their idea and not wanting to change some aspects of it. The market defines what goes, and startups need to listen to it and optimize their business accordingly.
Test everything! Go out and test your product, audience, channels, prices, and change, pivot if you will, based on the priceless feedback you will receive. Validation is key.
Finishing Thoughts
As you can see now, the best advice we can give is to stay consistent, resilient, and active. Also, be patient, don’t rush, focus on simple products at first, determine your audience, and start reaching out to them. And remember, validation, validation, validation!
Oh yes, and don’t forget your marketing strategy! We can help you with that by the way, just get in touch, we can’t wait to see your startup succeed.
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