The developments in the sectors of Information Technology in the last two decades has changed things drastically for the business-minded.
If you are in the age group of 20-30 years, it is highly likely that you either know someone who wants to be an entrepreneur or someone who is already on the rise.
Let's take a look at the top 10 mistakes startups make that ends up killing them.
1. A bad Idea
Most startups fail because their ideas are either derivatives of existing things, or aren't properly formed.
If your idea is unique, make it as practical as it can be. If it isn't unique, find a creative way to sell it. You don't have to stick to a vision you have unless it gives consumers something new.
The best way to come up with a good idea is, to do some research and to come up with a 'solution to an existing problem.'
2. Poor pricing
The problems in pricing are usually generated by an over/underestimation of the product's uniqueness or an over/underestimation of its need in the market. If we rule out some basic mistakes like greed and poor budget management in the production stages, we are left with these four mistakes that can ruin your price tag.
The solution is to do extensive product, market and consumer behavior research before putting a price tag on any product.
3. The 'Solo VS Team' dilemma
Not only being alone means that you have to do all of the work yourself, but it also means that you have no one to brainstorm with. If you are taking a wrong decision, there is no one to talk sense into you. And if you fail, you get demoralized quickly.
In any startup, you need a team that covers every significant aspect (ideation, technical, strategy, marketing, sales and public relations) and that can work as one unit in a hassle-free way.
You can have two founding members working in coordination with different people on a per-project basis, but having a team and covering all the major aspects is a must.
4. Ignoring branding
A lot of startups focus only on the product than the branding.
Strategy dominated by sales motive can give good results in the beginning but are not sustainable to push sales in the long run. And in the race of getting big profit in a short time, they forget to develop an affinity towards the product within their target group. It’s important to create a position disposition to toward the brand through effective branding so your product is not just other product or service in the market.
If you really do want to stand out in the market, you need a unique identity that people are going to remember. A good branding though a branding agency ensures synergy in all channel of communication and gives your firm a professional look which can leave a long lasting impression on everyone. Good branding cannot only boost consumer footfall but can also attract investors who are willing to invest in your venture.
5. Launch timing
The launch timing is about as important as changing your strategies at the right time once you are on the up and up.
Launching too soon (when you are not 100% ready to go in - with budgets, strategies and all in place) might put the company at risk and launching too late might be of little use as the consumers might have exhausted their money on some other product/service by then.
6. Poor location
If your business is not set up at a convenient geographical location, it's likely to fail.
Choose a place where people are supportive of what you are doing. Where you can grow, and make sales. A location that allows you to be seen and to create a network with people in business. Where standards are high.
7. Lack of focus
Most entrepreneurs either get into the game with a half-hearted effort of making it big, or they are tempted by other opportunities (that are not a part of their core business) when the startup begins to grow. It kills the company.
8. Resisting change
Many startups fail by resisting change in their product, quality, standards or strategy. You have to understand that once you are in the market, you have to flow with it.
Instead of sticking to the script and being adamant, do what works for the company.
9. Lack of a long-term vision
Having a realistic long term goal defines many actions that a company has to take along the way concerning product improvement, reach and more.
Setting a good long term goal demands you to answer questions that will force you to improve the company from time to time. For example "How will you keep selling this product 5 years from now" and "How many people do you want to reach by the end of 2025."
10. Poor management
When it comes to money and manpower, you need to find a way to get things done with bare expenses, without affecting the quality of your product/service. When it comes to managing your market strategies, you need to be creative and flexible and change with the market. And finally, when you are managing customer relations, you need to be able to take criticism in a positive manner and implement suggested changes if it betters the company.
Failures can teach you many things and those who learn from failures are wise, but those who learn from the failures of others are wiser.
So, If you are a startup or young entrepreneur please share your experiences as well.
