Apart from facing the challenge of building a business from scratch, most startup owners and founders have little or no experience of business.
The Startup idea may be great. But as the business takes off, complex problems arise – related to managing the young enterprise, resources and supply chain, and last but not the least the people.
Little wonder then, that 90% of startups fail. In order to make sure you are not a part of this 90%, here are seven mistakes that you need to avoid. These serve as pointers that you need to ‘always’ keep focused on, for a smooth take off and cruise:
1. Absence of a VisionIf you take your car out and don’t know where you want to go, you will end up driving in circles. You might drive very well. But you don’t have a destination to go to.
It’s the same with business. As a start up owner, you HAVE to have a VISION for your business. It’s like creating a picture of what your business will look like at the end of the journey. The Vision should define the Company’s purpose, who is it going to serve (customers) etc.
2. Absence of Business Goals and PlanJust creating a Business Vision and then sitting tight, will get you nowhere.
From the Vision will arise the need to list down key goals that will need to he achieved order to realize the Vision. Goals are those specific end points you need to reach.
A plan is the roadmap – the way every aspect of your business needs to run or the path it needs to move in, in order for the goals to be achieved.
3. One man showFew Startups met with success with only one founder. Establishing a company and a business is hard work, and it often takes more than an individual to launch a business. There are multiple tasks, which are difficult to accomplish alone. There are high and lows in business. There are challenging situations and setbacks where multiple minds work out a better way out, rather than one.
Therefore, unless you have with you with the same commitment and the same stakes in the business, chances are you’re going to face a tough uphill road ahead.
4. Splurging (Managing your money incorrectly)
This is pitfall that Startup founders or managers can fall into very easily. The temptation is to spend money of every conceivable idea that might give the business an early boost. This means over committing on resources especially particularly people. Everyone would tend to hire large numbers and top quality people, who naturally are expensive.
There may be a lot of ‘unnecessary’ expenses too – like renting a large swank office with a huge lease bill.
When it comes to expenses the trick is to grow then very gradually. Increase manpower strength step by step. Expand office space step by step.
It’s nice to get a huge fat cheque the investor who has decided to fund your startup. You’re suddenly swimming in money. But remember, very soon, he is going to be expecting his return on his investment. Make sure you have some healthy return to pay back to him, which will come through a profitable growing business.
5. Lacking the ability to ‘pivot’
Pivoting is the ability to quickly swing to a backup plan, in one of two possible scenarios – your business is going down south because the environment has changed, or, there’s new opportunity.
Nokia was once a paper mill and a rubber boots manufacturer. From there is became a telecom giant. A company called Odeo was once in the podcasting business. When Apple launched its own podcasting business, Odeo had no option but to pivot. Today Odeo is that social media platform called ‘TWITTER’
To have the ability to pivot means keeping a backup plan ready for a worse-case scenario and having a ‘flexible’ mind to take course correction if the original plan isn’t working out
6. Timing is everythingYou as startup owners have to make sure the company doesn’t launch too early or wait too long.
Launching your business at the right time can be arranged.
Launching too soon might put the entire enterprise at risk. Because yours might be a product or service that people don’t really want at this time or, your product is not ready to be marketed.
There is always a tendency to rush a startup to market out of a desire to beat the competition or start making revenue. Be sure that the startup is ready to go before making it public.
On the flip side, don’t wait too long. Otherwise there’s the chance all the money will be exhausted or that a competitor will be first to market a product. Make sure that everything is ready to roll but don’t procrastinate. Establish deadlines and meet them.
7. Getting the hiring process wrong
Many things can go wrong with the hiring process. You may hire too many people too quickly. Or, you may end up hiring people with a mismatch between the skills an employee possesses and those require for a job role.
Hire people who are committed to a ‘long haul’ and do not desert you as they see a ‘sinking ship’.
Last, but not the least be careful about what you promise by way of compensation. For instance a share of the company offered in lieu of salary, should be supported by a contract that is legally tenable in a court of law.
Photographs and article
Due credit : Mr Puneet Mathur
Email: email@example.com firstname.lastname@example.org Websites: www.principiumadvisory.in www.puneetmathur.in Blogs www.principiumcoaching.blogspot.com www.principiumcoaching.wordpress.com
Puneet Mathur is a Certified Life Coach, Certified Business Coach and a Certified Organization Development Coach. He specialises in helping business leaders to transform their enterprise into a professionally run Company by implementing state of art systems and processes, and building a highly motivated team Puneet is an experienced business leader, with about 30 years of Corporate Leadership experience in reputed Multi National and Indian Companies in the FMCG and Chemicals sector. He started his career with Britannia Industries as a Management Trainee. He has worked varied roles in Britannia Industries Ltd. Marico Industries Ltd. Coca Cola, and the Jubilant Bhartia Group. His last corporate stint was with Jubilant Industries Ltd. As Senior Vice President and Business Head of a strategic business unit (SBU, Puneet supervised Global Business Development, Global Key Account Management, Manufacturing R&D & New Product Development. Puneet has extensive experience in Sales & Distribution of FMCG products and Speciality Chemicals (B2B business). He has a rich experience of expanding distribution reach, Sales Force Productivity, International Business Development, and Exports.