It is a known fact that 30 percent of startups fail within the first five years of their launch. Launching a startup means investing a lot of both physical and mental energy. In addition, the money involved would make its failure to be very painful.
You therefore need to be very careful before you embark on this journey. Here are some tips that can help you avoid making mistakes that may lead to the failure of your startup:
Come up with a product/service that is acceptable to customers
Entrepreneurs usually fail to validate their product/service with customers. Many entrepreneurs have wasted hundreds of thousands of dollars on building something that nobody wanted.
The most important people you should seek validation from are the customers; they matter more than even the investors.
Value your co-founders, team members and partners
To be a successful entrepreneur you should be able to understand that you can do everything. There are certain functions that are beyond your capabilities. Get the right partners or team members to work with and make them feel that their contributions are appreciated.
In dealing with partners, you should also be ready to accommodate their perspectives without being so rigid.
Be very aggressive
Even though most people do not like very aggressive salespeople, sometimes it may force you to just pick up the phone and call the prospective them. Keep pushing until the call results into a sale. Without being aggressive, your startup may fail to pick up.
Recognize that fundraising is time-consuming
When you are building a startup, you will incur numerous expenses. Raising funds is not a one day affair; it eats up a lot of time. Expect to deal with quite a number of venture capitalists before you receive a real investment. Some startups have approached over 50 investors before striking a deal. So don’t give up, keep trying.
Keep your eyes on the cash flow
When you start a business, don’t have high expectations. You may have a large number of customers but not all of them will be paying. Check the revenue against expenditures to see whether you are making any progress.
Have a long term vision and sustain it
You need a long term goal for your business and you have to keep your eyes on it so as to succeed. If you lose focus along the way, the business will fail. There are also short term goals that you can set and strive to achieve to monitor your progress.
Do not raise too much money for a start
Raising too much money may result in the failure of your startup, more so if you don’t have validation to justify such huge amounts. You may end up investing it into a product that is not required by the customers. As a new venture, it’s always true that your product shall not have been tested at the time of launch and the response of the target group will still be unknown.
Build a unique product
Don’t copy another startup, and don’t focus on a small niche audience to avoid competition. As an entrepreneur, build your own product, not someone else’s. The most successful businesses execute on a vision that align with their product’s and users’ goal.