Let’s face it…
Funding and running a startup is hard.
However, not knowing where your head is during the process is often harder. Hence, protecting your startup from failing may seem like the most difficult job you ever had.
If you haven’t seen the latest stats regarding startups, you should know that 9 out of 10 startups won’t make the past the 5-year mark.
One of the key factors to survive in the long haul is the ability to raise funding, attract top talent and find the ideal product/market fit. There are really a lot of factors and mental concepts that you can follow.
Your experience also plays a part. After asking a lot of experienced entrepreneurs about the best ways to protect your startup from failing, we found that there are many mistakes you should consider.
Below, we are outlining the most important ones.
Avoid Hiring The Wrong People
This probably sounds like a no-brainer to you, but hiring the wrong people can devastate your business and make you fail sooner than later.
“How do I know that I have the right people by my side?” – you are asking yourself.
Well, this is a tough one. Mostly because even the best employee may not be the right fit for your startup at the particular moment. Ideally, you should hire people who match your passion for growth.
Hiring the wrong people, however, could actually reduce your productivity and cost you big time. Our advice is to:
- Ask the right questions during your interviews (aligning your goals and plans)
- Look for problem-solvers with solid technical skills
- Hire people who are not afraid to take chances
- Ask behavioral interview questions to see how each candidate solves problems (ex. “Tell me about a time you faced a challenge at work and how you overcame it.”)
If your candidates cannot think of examples or are showing bad signs, rule them out immediately.
Avoid Interruptions And Other Bottlenecks
According to some sources, about 90% of all work done in the office is waste. Even if we don’t take this number for granted, there are still many bottlenecks that we are all surrounded by in our office.
From interruptions to approvals to data re-entry, mishandled conflict, task switching… This adds up to a lot of wasted time.
Ideally, startups need employees who are not afraid to think outside the box – and ones who can save a startup from financial ruins. So, it goes without saying that burdening your employees with complicated processes can distract them from doing the work that they are paid for.
The trick here is to limit your processes and encourage your employees to come to you with suggestions on how you can make your existing processes more efficient or more useful.
After all, continuous improvement means improving your operations to be better, faster and more productive.
Stop Thinking You ‘Know Your Customers’
A lot of founders and entrepreneurs think that they know their customers.
In reality, however, most of them fail to even understand the basic needs of their focus groups.
The best way to know their needs is through surveys, continuous communication, listening to their needs and continuously asking for feedback.
If you are just starting out, you will need to do a lot of research in order to determine if your idea has a place in the market. One of the best ways to do this is to search for keywords and see all the questions that real people have searched online for that topic.
A tool that we recommend in this manner is Answer the Public – an online algorithm that shows you the exact questions that people have asked Google or other search engines. The good thing is that you can sort the questions by who, what, when, where and why (they have been asked) – or even see the questions that start with “are.”
Don’t even try to serve everyone
Is ‘everyone’ your market?
No – you are selling your products and services to a specific group – which is why you should serve their needs only.
This is a common mistake that today’s entrepreneurs and founders make. To prevent it, make sure to understand your ideal customers and market to them.
A tool that can greatly help you in cases like this is Google Analytics. Through the simple and complex analytics, you can know which people visit your website, which engage with it most and what are they doing on your website – linked to the problems they are having or solutions they are looking for.
Age, gender, income, style, job, location, home…There are a lot of filters that you can use to sort out your focus (target) audience. Ideally, you should see what appeals to them most and how connected they are to your website or other marketing channels.
Mistakes You Should Stop Right Now…
As our last piece of advice on this topic, we suggest you eliminate some behaviors and actions that may lead you to lose business.
In most of the cases, founders and entrepreneurs make the following mistakes:
- They fail to communicate with their audience
- They lack feedback
- They have little or no context about their company direction
- They are not updated on everyone’s work
- They don’t have a plan they should stick to
- They don’t love their ideas
- They don’t see their ideas as opportunities
- They suck at sales
- They try to raise money too early
- They don’t build the right teams
- They don’t focus on analytics
…and many others. If you like to see all of the common mistakes that founders make, this Quora thread is a great place to start.
In the end, being an entrepreneur is hard – and there is no single doubt about that. When starting out, it is hard to know what to focus on mostly.
You want to get to market quickly – but rushing can backfire as well.
There isn’t any playbook that teaches you about the best principles. No instruction manual to see how to succeed. No video to show you what steps to take and which actions to perform. And nothing that can make things easy for you.
And while the difficulty is part of the deal, there are many other things that founders often find themselves entangled with – and ones that make it harder. We hope that the advice listed above will help your business thrive – and help you avoid the common pitfalls of startups and organizations.