The 9 Mistakes That Could Make Or Break Your Startup
7/2/21 8:00 AM
The key to any successful start-up is to learn from mistakes - not only your errors but also the mistakes of others. As with anything new, some things will undoubtedly go wrong, giving you plenty of opportunities to learn and grow.
And while experience can be a painful teacher, it's also a compelling one. But, of course, learning from the mistakes of others is always much less painful, so here are 9 of the biggest mistakes tech start-ups make so you can be aware of them (and, more importantly) avoid them.
1. Picking The Wrong Team
Your buddies may be fun to hang out with on the weekends or even geek-out together at Comic-Con conventions, but this doesn't mean they'll be great investors or business partners. Building a reliable, competent, passionate, dedicated team to grow your business doesn't happen by accident. Your team is going to be what transforms your start-up into a thriving company, so don't settle for "good enough" when it comes to building your team.
This is especially important when it comes to selecting partners and investors. You want to create a support system of key people who share your vision and trust. One thing that's guaranteed to make even the most well-designed start-up struggle to grow: an unreasonable investor. Don't say yes to the money just because it's the first offer you get. Ensure your investors share your vision and values, are easy to communicate with, are trustworthy, and have your company's core vision and values in mind.2. Doing Too Much, Too Soon
In the early stages of your start-up, especially when things are going well, it's easy to think about shortcuts on how you can do even more. You start to think about the logistics of expanding and how to get your product/service to even more people.
But too much too soon could hurt more than it could help. So before you start to think about expansion, consider the funds and the staff it'll take to make the expansion run smoothly. Intentional decisions and focused growth may feel like they take forever, but it can be the most successful and authentic way to grow your customer base long-term.3. Being Closed-Minded
Surrounding yourself with innovative and successful people than you is one of the best things you can do for your business. Learning from their past mistakes, listening to their advice, and watching how they work can help you lead your start-up more effectively.
Being unwilling to take advice or constructive criticism can keep the growth of your business at a standstill. The sooner you realize there's more than one right way to do things and that you don't have to develop all of the correct answers personally, the faster you'll be able to implement proven solutions and creative new ideas alike.4. Having (A) Blurry Vision
Creating a solid vision will keep you, and your company focused on what's important. It will be the filter through which you run all of your decisions and let your stakeholders know what to expect. If you don't take the time to create a solid vision, you're rolling the dice on setting yourself up for failure.
A vague vision statement, or having no accurate vision statement at all, allows your team to fill that void and project their own perceived version of your vision and goals. Thus, leading to disorganized communications and expectations and generally making it difficult to move forward.5. Not Focusing On Marketing
Your product or service may be world-changing, but if people don't know about it, you're going nowhere fast. Of course, most start-ups will have no issue creating a simple website or posting thought-provoking updates on social media. Still, in this day of fierce competition and rapid innovation, that's just not going to be enough to generate qualified sales leads.
A clear, focused, well-planned marketing strategy is essential in getting your sales team in front of your ideal customers. Marketing is not something you can do by the seat of your pants. You're going to have to invest some time and money into a plan for generating real revenue, and intentional and measurable marketing is one of the best ways to do that.
Think about whom you want your customers to be, where to find them online, and how to get them interested in your story. Don't be afraid to get creative with your marketing campaigns, and if the thought of advertising and marketing gives you a stress headache, hire someone to do it.
Skimping on marketing is one of the biggest mistakes a tech start-up can make.
Check out our marketing tips for start-ups.
6. Not Accounting For Accounting.
Your start-up is a dream come true, a physical realization of hours and hours of thinking and dreaming and hoping and wishing and working. But once it starts rolling, you've got to be focused on the numbers.
If you turn a blind eye to budgeting and accounting, you'll end up in big trouble pretty quickly. Supplies have to be bought, people have to be paid, and advertising needs to be done. A weak financial plan can quickly turn a great idea into a costly mistake.
7. Thinking You've Crossed The Finish Line.
Just because your small business is up and running doesn't mean you're done. If you're under the impression that all of the hard work is done and that your product or service has no real competition, you'll find your sales plateauing before you know it.
There's always room to upgrade and improve. If you think everything's perfect, ask for a few honest reviews from customers, and you'll quickly have plenty to work on. If you're the founder/CEO and you're also carrying all of the sales responsibility:
- Don't step out of that role until you've documented solid sales processes
- Engaged a CRM platform to track lead engagement and revenue forecasting
- Hired the right team to implement your proven way of doing things.
8. Putting Profit Over People
The whole idea of a start-up is to find a solution to a problem and make money in the process. But if you only focus on your product and the bottom line, you may quickly find yourself surrounded by an unhappy team. Or no team at all.
A strong leader listens to the needs of their team and acts accordingly. How your team feels valued and appreciated should be of utmost importance. When employees are happy, they're much more likely to work hard and with focus to meet the company's shared goals. Once you've started to build your team, spend quality time focusing on these people who will move your vision forward.
Check out our blog on how to build a small but mighty team
Note - If you can run the entire start-up without the help of anyone else, then this rule may not apply. But if you rely on investors, employees, vendors, or anyone else to move your company forward, you need to make their happiness and buy-in a priority.
9. Not Taking Risks
Officially launching your start-up is one of the most exciting moments in your company's history. It's when you finally reveal all of your hard work to the general public. But the timing of this launch is critical. You can't control many things about the timing of your launch, like the overall state of the economy or what existing competitors may be doing.
However, if you aren't making mistakes, you aren't taking risks, and if you aren't taking risks, you're not growing. As a result, your company will hit obstacles, face challenges and yes, make mistakes. How you handle these mistakes will define you as a leader and set the course for the success of the start-up. But if you can at least avoid these 9, you'll be off to a pretty good start.
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