Top Reasons why First Time Entrepreneurs Fail and how to Avoid Them
When it comes to entrepreneurship, there is no sure fire way to succeed. If there were, everyone would be doing it. Truth is, there are so many itty bitty details that can make or break an entrepreneurs success. The smallest item overlooked in the beginning phases can spell catastrophe down the road.
While we can’t give you a list of all the mistakes made by every entrepreneur ever, we can give you a short list of common mistakes and how to avoid them.
Learn from the mistakes of entrepreneurs before you and save yourself time, money and a whole lot of disappointment
- No written plans: Do yourself a favor: write down your business plan before launching your startup. As a first time entrepreneur, it’s easy to get wrapped up in the little details. Having a written plan will help keep you focused and on the right track
- A slim or non-existent revenue model: Create a model for generating revenue. It’s pretty simple: make money or your startup goes under. It’s better to have a revenue model to follow from day one rather than struggling to develop one when your treading water.
- What are we selling or what service are we providing?
- Who is our target market
- Who is our competition? What competitive advantage do we have?
- What’s the price of our product/service?
- How much is the market willing to pay for our product/service?
- Will anyone buy our product/service?
- Choosing a poor startup team: Your startup team can either make or break you, so choose wisely. Don’t just hire your close friends and family members, find people that share your passion and have valuable skills.
- Choosing the wrong investor: Not all investors are equal. One of the most important lessons a young entrepreneur must learn is how to identify and attract the investor that’s right for your startup. This may require some research on both the formal and informal level. Look beyond the information provided by investors. Ask other entrepreneurs about their investor experiences.
- Failing to execute: A good idea is worthless without proper execution. Let’s get real: it doesn’t matter how revolutionary your idea is, it will fail if you don’t execute properly. Looking back, Facebook wasn’t the first social media site; it was the best executed. Pandora wasn’t the first music site; again, it was just the best executed. Don’t make business and marketing plans and say you’re going to do it. Pull them out regularly and stick to them. Make it work.
- Too much competition: The more competitive a market is, the harder time you’ll have getting funded. It’s just the way it is. Try penetrating an untapped or overlooked market. If you’re going to try and make it in an overcrowded market, try these tips.
- Not enough marketing: Don’t live by the old term “If you build it they will come.” In reality, you need to market, market and market some more. It doesn’t matter how great your product is: people can’t buy it if they don’t know it exists.
- Loosing the faith: If you’re going to be an entrepreneur, you need to become a warrior. You can’t just give up when the going gets tough. When you reach a roadblock, you don’t turn around, you pivot and make it work. One of the biggest mistakes first time entrepreneurs make is throwing in the towel when they encounter their first problem. Get tough and persevere.
- Neglecting market research : Knowing your market is one the most vital things an entrepreneur must do. If there’s no market for your product then you’re wasting your time. In other words, make sure people will want your product before you’re in too deep.
Have additional advice of stories for first time entrepreneurs? Leave us a comment and we’ll make sure to add onto our list!