Everyone wants to have their own business but how many have what it takes to actually start one?
For some people starting a business is just a pipe dream, but entrepreneurs aren’t just “some people.” They’re highly-driven and ambitious people who choose to be in the driver seat because they want to steer their business in the right direction.
You need to have a high belief in yourself to become an entrepreneur considering only 50% of start-ups are still operating after five years.
While a good number of entrepreneurs have had years of work experience prior to starting their own business, becoming an owner is vastly different from being an employee.
From the outside and in theory, running a business seems easy; after all, haven’t we sometimes thought we could do a better job than our boss?
In reality, when you own a business the responsibilities are greater, the risks are higher, and the rewards could be few and far between.
In a nutshell, the number one reason why start ups fail is lack of experience. Entrepreneurship is a whole different ball game.
The challenges and nuances are different.
It doesn’t matter what your educational attainment is, where you worked previously or whom you know in business.
When you own a start–up, you’re subject to the statistical figures that have defined the industry.
The basic rule for building a successful start-up is the same as for any endeavor in life: limit the amount of mistakes that you make.
Here are five mistakes that can kill your start-up business:
1. Lack of research
Every business starts out as an idea, but not all ideas are viable.
Have you heard of “Paw Pals”? Probably not because the idea of a dating service for cats wasn’t appealing for the market either.
Just because you believe in your idea and are passionate about it doesn’t mean the market will embrace it.
You have to do the research.
When you don’t do enough research on your idea and rely mostly on gut feeling, you will become too emotional and disable your ability to react and adapt to conditions that are contrary to your business goals.
“A person who never made a mistake never tried anything new.” – Albert Einstein
2. Searching for the perfect plan
On the other side of the spectrum, there are entrepreneurs who spend too much time planning and analyzing data.
They end up moving too slow and taking too long to launch that they invariably eliminate the greatest advantages of a start-up business: flexibility and mobility.
Because start-ups are small in scale and less processed or structured, it is easier for them to move and react to problems in their current business model.
But they need to move fast because the opportunity to be first and innovate can be lost to a competitor.
Unless a product or service is launched, everything remains theoretical. You cannot fine-tune your business until you allow it to perform in the market.
3. Blindly follow advice
It is always a good idea for entrepreneurs to seek the advice of people you can trust or those who have established a great reputation in business.
Keep in mind that advice comes from a person whose basis for formulating it could be a consequence of his or her own unique set of experiences or circumstances.
Given the ever-changing business conditions, these may no longer be relevant.
Seek advice but don’t forget #1 and do the research.
In the end, the best business adviser is you.
“Ideas are easy. Implementation is hard.” – Guy Kawasaki
4. Lack of focus
Entrepreneurs can get easily distracted, especially if the original business plan isn’t doing well and cash resources are falling low.
The tendency is to shift strategy and look for a “quick hit”; a business idea that will generate the most money in the fastest amount of time even if it is not the entrepreneur’s core competence.
Success takes time to achieve. You need to find motivation and stay focused on your original purpose.
This is the reason why you should not spend too much time developing the perfect plan and focus instead on implementation.
A business plan should be flexible enough to accommodate changes in the business environment. Deviating from your original course could possibly cost you more money.
5. Adapting fear based management
As tough as entrepreneurs are, some become too wary or averse of the risks and possibilities of failures that when making decisions they tend to favor those which present less risks even though the probability of its occurrence is minimal at best.
Failure is part of everyday life so you should no longer fear it.
The most successful entrepreneurs such as Sir Richard Branson, Jack Ma, and Mark Zuckerberg have embraced the reality of failure and this has allowed them to stay on track of their business strategy.
They know it exists and are prepared for it.
Fear is good because it keeps us on our toes but instead of freezing, we should keep moving.
Mistakes are bound to happen when you’re an entrepreneur.
It is part of the risk you take when you make the decision to start your own business, but mistakes happen for a reason. They will make you better if you learn from them.