“To err is human, but to learn from our mistakes is divine”. When an entrepreneur sets out into the world in hopes of building a successful startup, they’re hopeful and optimistic. They feel that with their sheer good intentions and mental strategies they can blaze the trail of start-ups. But the reality is quite different.
The truth is, when a founders starts off with the mammoth task of creating a brand, he or she is bound to make some common mistakes. It’s a natural part of the process. The important thing is learning from our mistakes and those made by anyone who has ventured into this path before us, instead of getting discouraged.
Let us take a good look at 10 of the biggest mistakes founders usually make :
1. Building Solution first
Often, founders work backwards. They build their “solution” based on the assumption that there’s a problem somewhere. But that is not how it should work. And more often than not, you might end up building solutions that don’t even work. If you wish to base a start-up on providing a solution to a problem, identify and understand the problem first. Only then you start looking for solutions. If your solution doesn’t save time, money or builds revenue, then there’s likely no problem in need of such a solution.
- Misinterpreting market
One of the most common areas where start-ups tend to commit mistakes is not studying the market properly. Studying the market and knowing the demographic of your customers is a major part of the process. It helps you understand your customer base better and take important decisions such as estimating the costs, gauging the demand and advertising the product in a way that would appeal to the target customers. Misinterpreting the market demographics may lead to monetary loss or a dip in the sales. Therefore it is very important to study and interpret the market trend accurately.
3. Chasing competition
Most start-up begin their journey by critically analysing their competitors. While staying alert and learning the ropes from those around you is a good thing, obsessing over the competition will only end up discouraging you. If you have good intentions to address a certain problem and help out your prospects who are facing that problem, the only people you should care about are your customers. Understand that your competitors have also started from the scratch and it takes time to reach milestones. Focus on solving the problems of the customers and ignore the unhealthy rat race – everything else will automatically fall into place.
- Delayed decisions
As founders we often take too long to take decisions and end up losing major opportunities. We hesitate to walk away from a bad contract even when our intuitions say otherwise. This may cost us good business opportunities and even customers. One of the secrets of the trade that we have to learn is being fast, we should follow our instincts and seize the opportunities that come.
- Wrong Partnerships
When we start off with the dream of building a scalable business, we have our own set of values and moral code of conduct. We wish to build the start-up brick by brick our own way. But often, we partner up with individuals whose morals and ethics are different from ours just for the sake of the capital investment or accelerated growth. Therefore, it is strongly advised to first know, understand and form a bond with and partnership before co-founding a start-up to avoid hiccups at work.
- Micromanaging Team
Founders, at the early stage of any start-up are understandably anxious. They’re still not completely trusting of their staff and often underestimate their abilities. This results in them either doing the staff’s part of the job too or harrowing them continuously to get the job done. Either way, it results in overworking and exhaustion and forms a bad relationship between the founder and the staff. Learn to delegate work amongst your staff members wisely. If you’re not sure of their abilities initially, give them small targets and help them if required. This way, you will eventually learn to trust them. The staff too will feel like the part of a team and a healthy relationship between you and your staff will form.
7. I can do it all alone
Most founders, in the initial period, prefer to multitask – design, development, marketing- they have their hands everywhere. That either happens because they are under-staffed or because they haven’t started delegating work yet. This makes them lose focus. Hone in on the things you’re really great at and motivate and hire team who shares your vision and passion. This helps the company grow.
8. Not talking to customers
The reason start-ups exist in the first place, is for the customers. They have the power to make and break your company. Therefore it is very important to go beyond your way and build and actual human rapport with your customer base. Interact with them as often and for as long as possible. This will build their trust on you and they will continue doing business with your company.
9. Product Pricing
If you believe that the solution that your company is providing is genuinely and significantly helping out your customers, there’s no reason for you to offer free or undercharge for it. Entrepreneurs spend huge capital in building product / delivering services but are offen afraid of asking for even the cost. Offering free or undercharging never create a long term scalable commercially viable business. Genuine customers will get deterred away by the suspiciously low prices and cheap customers might try to exploit you further. Know your worth, and understand the value of your work – charge accordingly.
10. Poor Contracts.
Often we let our personal relationships get into the way of our professionalism. We let our loved ones slide when it comes to legal contracts because they’re friends or family. One of the biggest mistakes a business owner/entrepreneur can make when starting a business is the failure to implement contracts. No matter how good relationships may be, they can brutally end if systems and agreements are not abided by. Hence a founder must always make sure he/she keeps away personal sentiments from his professional life.
Ashish Mittal is Chief Mentor and Founder of TurningIdeas Ventures, a startup Incubator based in Noida. You can follow him at @ashishmitt