- Posted April 1, 2014 by
Small Business Startup Common Mistakes
Starting a business and set up your company anywhere worldwide is very easy step as you can imagine it. There are so many things to think about and decisions to make; the pressure can cause you to make a poor decision that can hurt your potential for success, or at least set you back. You must remember that for example in USA total list of bankrupted companies in per annum is 3-4 million companies. Only 20-25 % of startup companies can develop their business to reach their targets, while this last is depending on recourses that are very limited today and sometimes if we consider through financial recourses this is more expensive as we can to think about it.
While there isn't a fool-proof plan to reach small business startup success, there are several common and dangerous mistakes many new business owners make that can negatively impact their businesses. Running a small business can be perilous. You have to become a jack-of-all-trades, sufficiently versed in sales, marketing, product development, customer service, database management, HR – and everything else – to keep your business growing.
From my experience in major sectors worldwide especially in North America, MENA, Asia-Pacific i found several mistakes that is common for all startup companies:
- Skipping the planning phase - Planning may be tedious, but without a solid plan for your business that includes business idea research and market potential, you will be operating in the dark. The most important plans to consider include a business plan, a financial plan and a marketing plan. When you starting your business it's better to think wisely and plan it for short term period.
- Avoiding new technologies - this is common mistake especially in Asia-Pacific and MENA region. Many small business owners trying to have less expenses and they think that pay money in technologies isn't profitable for them, but they never analyzing that new technologies can reduce their expenses and make their business more flexible and result-oriented.
- Raising too much money too early - Bootstrapping a startup is scary. No one likes seeing their savings dwindle away. But when you rely on outside investors to take all the risk, it can make founders frivolous with their spending. It also can dilute them so a future exit becomes much less rewarding.
- Having too much Co-Founders - Partnership is another problem and more expensive for business and for personal relations too. It increases time for decision and not flexible for better performance. Most startups with multiple founders dwindle down to one lead founder anyhow. Think Facebook, Quora, Path and Foursquare.
- Overspending -Starting a business doesn't have to require a large investment, but some new business owners feel that they need to spend a lot to purchase the best of the best everything from marketing help, to equipment, to software.
- Getting out too much - There are a lot of networking events and parties in the startup world. It's possible to network too much, and not work enough. Strike a balance. If you're a well-known face in the startup community you should probably be spending more time at your desk. Otherwise it sends a bad message to your employees and investors. Unfortunately today many businessman don't realizes that business and even parties isn't one thing and they must separate this both from each other.
- Being impatient - Remember patience is a best key of success. Let's see history of Walt Disney, he bankrupted 3 time but at last dreams came true.
There isn't a full list of mistakes but this are commons from my view. Only what can i share from my experience is that dream and dream again, one day this dream will come true and everything will be alright. If business is a hobby for you, you will become a successful businessman.
Chief Executive Officer
I.B. Capital Management