It’s no secret that we’re living in the age of innovation. Everyday entrepreneurs are setting out on their journey to hopefully create the next big thing. If you’re one of those entrepreneurs starting a business for the first time, you’re going to need all the help you can get.
Luckily for you, many have tried and failed before you. Those who failed have also been kind of enough to share their experiences, in hopes that others don’t make the same mistakes. If you’re a first time entrepreneur, make sure you avoid these four common mistakes.
Letting Fear Slow You Down
Starting a business is definitely not for the faint of heart. As a first timer it’s very common to always ask yourself “what if”. What is your customers hate your product? What if you’re timing is off? You can come up with hundreds of these questions. Asking yourself these isn’t the mistake. The problem arises when you let doubt or fear slow you down.
As you build your business your going to run into problems. You may release a product that your customers hate. Your timing may very well have been off. That doesn’t mean it’s the end of your journey if you don’t want it to be. The worst thing you can do is become stagnant because of fear.
Setting Unrealistic Goals
Goal setting is not only supposed to keep you motivated, it’s also to keep you on track. Think of each of your goals as a progress check. If you aren’t meeting your goals then you aren’t making progress.
That said, you should always aim to set realistic goals. First time entrepreneurs are often so excited about their big idea that they set ridiculous goals for themselves. Not only does this set you up for disappointment, but others will start to lose confidence in you if you constantly underdeliver.
Misuse of Capital
It’s estimated that about nine out of every ten businesses will fail. One of the biggest reasons for failure is the lack of or misuse of capital. As you grow your business it’s important to spend your capital in the proper areas so you can scale the business. That said, entrepreneurs often get carried away as they throw money at every opportunity in hopes of a return.
The best way to solve this problem is through proper cash-flow management. If you don’t have a dedicated finance team you should use digital accounting software to keep your books in order. You should take note of every single penny coming in and out of your business.
Ignoring Your Competition
Very few business ideas are completely original. That said, there’s a good chance your business has competition, and lots of it. Whether you’re busy focusing on your own business or you’re just overly confident, it’s common to ignore about your competition. This is a fatal mistake.
You need to be able to articulate and demonstrate exactly how your business differentiates from your competitors. If an investor asks about a certain product or service offered by your competition, you need to have an answer for why you’re better. If you tell that investor you weren’t aware of that product or service, there’s a good chance you’ll be leaving that meeting empty handed.
In startups, most lessons are learned the hard way. That said, there’s no reason why you can’t go into your first business with common knowledge. If you’re starting a business for the first time, make sure you avoid the four mistakes listed above.