Entrepreneur definition: (noun) “an individual that leads the operations of a business, someone willing to take financial risks in order to achieve success”
It sounds easy right? But being a successful entrepreneur isn’t easy. There are potential points of failure at every turn; however, success doesn’t mean being in the right place at the right time. It means following a process that takes other entrepreneur’s failures and mistakes into account. When you start your new business, avoid these seventeen mistakes so that you’ll be ahead of the curve and on the fast track to success. You’ll then have more time and energy to devote to your best entrepreneur ideas that have the potential to change the world.
1. Not spending enough money or over-spending.
Both of these are equally detrimental to the success of any entrepreneur. If you’re a new entrepreneur, money is likely to be one of your biggest concerns. You might be yourself questions like, 'When do I spend? When do I refuse to spend? When can I save?’ The truth is, though it’s easier said than done, that you should spend very, very wisely. Unless it’s absolutely essential, don’t buy it. That being said, you can’t be too frugal and refuse to spend money on items or services that will get your business up and running. The main thing is to manage the finances of your business as closely as possible.
2. Assuming your new business doesn’t have direct competition.
No matter what industry your business is in or what ingenious product you’re about to launch, remember, there will be competitors and they will be doing everything they possibly can to try to take sales away from you. There’s always going to be someone who already has market share in your industry or niche. Plan accordingly and do plenty of research so that your new company is ready to go to war.
3. Hiring the cheapest employees possible.
If an employee or consultants is cheap, it’s usually for a reason. That’s not to say that you should pay each employee $150,000 a year, but you must be cautious in how you approach the hiring process. One strategy a lot of successful entrepreneurs use is to hire young professionals that have about three to six years of experience. Their lack of decades of experience will make them cheaper; however, many will be just as skilled as industry veterans with tons of experience.
4. Not setting or implementing realistic goals.
It’s great to aim for the stars and have lofty long-term goals, but if you don’t have any realistic short-term goals, you’re likely setting yourself up for huge disappointment. Make your goals as specific as possible so that your employees will understand what they are and also what their individual objectives are. It’s great you want the company to make $10,000,000 a year by year three, but how can Steve in Accounting or Sarah in Advertising help ensure this will become a reality? Even famous entrepreneurs with billions in the bank still, to this day, set daily goals that their employees can achieve.
5. Not focusing enough on marketing.
“If you build it, they will come” is a common mantra in business; however, it’s rarely true, especially for new companies. No one is going to know to come to your entrepreneural business unless you tell them—hence, marketing. You can’t just rely on word of mouth. You’ve got to consider, content marketing, PR, paid advertising, and SEO; otherwise, you’re likely to be left in the dust. A great way to determine what your marketing strategy should be is to analyze the marketing efforts of your competitors.
6. Having a small profit margin.
Having a big profit margin is absolutely critical to the survival of your new business. You don’t want to do what many new business entrepreneurs do, in which their margin is too small and they have no choice but to increase pricing and alienate their customers. Regularly hold meetings to analyze to go over operational and production costs so that you are always aware of how much (or how little) flexibility you have. Do whatever it takes to increase your profit margin.
7. Assuming you can do it all on your own.
Having confidence is key; however, don’t be overly self-confident and think that you can make your business successful with little to no help. Business simply doesn’t work like this. It’s great that you have passion and know the ins and outs of your product or service, but that’s just not good enough. Find some people who lend you their expertise so don’t have to go at it alone when times get tough. Whether it’s a consultant or mentor, seek help that will best position you to knock out all of your objectives.
8. Not taking action out of fear.
It doesn’t matter how much experience you have, starting a new business can be very, very scary. There are countless obstacles at every turn; however, you can’t panic or stay stagnant due to fear. You must do your best to remain calm and come up with a solution for every problem that comes you or your new company’s way.
9. Valuing your product more than people.
Sure, it’s sort of a cliche, but the customer must come first. No exceptions. Your new company will never be successful and have loyal customers if all you care about is the bottomline. Try to tailor every single aspect of your company with customer experience as the top priority; otherwise, your bottomline is going to suffer.
10. Assuming your product will catch on with a secondary market.
You can’t assume anything in business; especially, that your product is so great that it will catch on in similar markets. It might. It might not. Before you find out, do as much market research as you can so that your company is as prepared as it can be. This means you must talk to people who will provide their honest feedback. You may not enjoy what they have to say, but that’s much better than the alternative, which is your product filling because you made assumptions and didn’t do enough research and planning.
11. Not taking care of seemingly small issues such as copyright.
Train everyone in your new business to do all the little things correctly so that problems are less likely to occur. For example, say your marketing team features an image that your company doesn’t have the rights use. This may seem like a small mistake; however, photographers can demand tens of thousands of dollars if a business uses copyrighted imaged without permission. Teach your employees to be smart and avoid as many costly mistakes as they possibly can.
12. Partnering with too many people.
Two words: start small. It’s a lot easier to bring people onboard as your company gains success than it is to have to get rid of people to cut costs. No matter how great you think your product or service is, remember to conduct operations intelligently by keeping your circle small. It will grow as your brand grows.
13. Not ensuring everyone gets along.
Pay attention to how employees are interacting at your new business. If you notice conflicts and disagreements, address them today before the problems escalate. More is going to be at stake as time goes by. You can’t afford to simply hope that people will start getting along with each other.
14. Depending too much on automation.
Automation, when used appropriately, can greatly benefit your businesses and save you time and money; however, too much automation will lead to a lack of accountability in your new business. People are important in a new business, whether it’s for purposes of critical thinking or being face-to-face with customers.
15. Refusing to admit fault.
It’s all right to make mistakes. Everyone does while building a new company. It’s not right to refuse to admit those mistakes. You will quickly lose the respect of your employees when this happens. Not only should you admit your mistakes, you should do all you can to correct them so that whatever you did incorrectly won’t happen again. Even the smartest businesspeople in the world seek the advice of others and listen to what they have to say. Don’t ever lose sight of this.
16. Be greedy.
We get it. You want to make as much money as possible. Everybody does, but there’s a fine line between maximizing profit margins and being consumed by greed. If you only set your sights on money, you’re going to fail to see everything else that’s important to your company’s success. If all you care about is making money, you’re probably gong to fail. There’s a multitude of things you need to care about, such as the morale of your employees and the satisfaction of your clients and customers.
17. Being impatient.
It’s not just young entrepreneurs- many businesses fail due to lack of patience. There’s a reason for the old adage, “patience is a virtue.” Without it, companies will fold at the first sign of trouble. You’ve got to be strong and keep your head up when times get tough. Look at the history of almost any successful company in the world and you will see they remained patient when times got tough.
Sure, being a successful entrepreneur isn’t easy; however, if you avoid these seventeen mistakes, you will be on the right track to positioning your new business for success. How to become an entrepreneur? That’s really up to you. Which is why you shouldn’t overthink any of this. Just be smart. Be confident. Be patient. You can do it.
Whenever you feel down or anxious about starting your company, try looking up entrepreneur quotes so you can get inspired. As the entrepreneur Walt Disney, (you may have heard of him), once said, “All our dreams can come true, if we have the courage to pursue them.”