9 Reasons Why Startups Fail and How Entrepreneurs Can Avoid Them
Jumping into the world of entrepreneurship is a giant leap that many make without fully understanding the steps necessary to make it a successful start.
Why do startups fail? Mistakes are easy to make when you are learning as you go, but with the advice and experience of those who have been there and already made those mistakes, you’ve got a better chance of finding success in your startup and steering clear of the same mistakes along the way.
Sometimes it’s just luck that things don’t pan out as planned, but these are the nine biggest mistakes entrepreneurs continue making that lead to the downfall of their businesses.
1. Going at it alone
Saying that a starting a new business is an overwhelming venture is a complete understatement. It’s stressful, hectic, scary and exciting all at once. And, it’s a lot of work. Yes, it’s possible to launch your business and find success all by yourself, but the vast majority – over ¾ of successful internet companies – had more than one founder.
It’s always been said that two heads are better than one, and this does ring true when it comes to startup businesses. Two perspectives, two decision makers, two people thinking and analyzing the next steps to take – yes, there could be clashes of ideas and personalities, but what an advantage it is to have another person with a vested interest contributing to the planning and decision making.
Work can be delegated between two, instead of one, and each person with their different areas of expertise and strengths can contribute in different ways.
2. Being afraid of your competition
You’re always going to have competition in some way or another, no matter what business you’re in. Having a bit of nervousness is normal, but being completely fearful of your competition may be a sign that you’re not fully prepared or that your product is not as unique as you think it may be. If you’ve got a superior product, you should have nothing to worry about as far as competition is concerned. Get the word out about your product and how it’s so much better than the rest, through your social media outlets, made manageable by Buffer.
3. Not letting someone else do the work for you
There’s so much work to do when it comes to launching and running a new business. Trying to do it all yourself is an impractical feat. Delegating the work to others not only lets you focus on other areas of the business, but it allows you to hire someone who is more suited than you are to do that particular task. Freelance professionals at Upwork or Peopleperhour are always ready to work for you, bidding competitively to do the job you need done.
But, when you want to do the work yourself, make sure you’re doing it properly. Be open to suggestions in all areas of business – ProWritingAid can help make suggestions to your content to improve your writing. If you’re creating content, make sure any references you’re making are absolutely perfect with the help of Cite It In. Commit fully to your business and commit to ensuring what you’re offering your customers is always the best, error free content. Academized or Australian Help can guide you in the right direction when you need help making sure your content is spot-on and plagiarism-free. And remember, using Easy Word Count to keep your content between 2,000 and 2,500 words means it’ll rank higher in search engines and be easier for your customers to find.
4. Not being fully committed
It’s a tough decision to make, starting up your own business, but once you’ve fully committed to doing it, you’ve got to put your money where your mouth is and completely commit yourself to working towards the success of your business.
At the beginning, when it’s all new and exciting, this may be easy to do. But as time goes on, and things get difficult or sometimes boring, it’s easy to lose interest. If business hasn’t taken off as expected, you may be tempted to start looking for another source of income – maybe you haven’t left your day job yet. The unknown can always be a scary thing, but fully committing yourself to your business is just that – putting your heart, soul and every bit of your energy and focus on that business.
5. Not having a good hiring process
Regardless if you’re hiring full time employees or freelancers to do work when needed, you’ve got to have a solid hiring process in place, to ensure you’re getting the right person for the job every single time. The people you hire to work for you become the face and voice for your company and your brand, so you’ve got to take the necessary time and effort to hire properly. The easiest way to do this is to look at the hiring practices of other successful companies like yours, and adopt their process as your own.
6. Not changing your stubborn ways
Having a plan is great. But, being so stubborn as to not wanting to adapt to change can hinder your startup’s success. Being closed to new ideas from others, not wanting to make changes to your plans when things aren’t working or refusing to adapt to new information could lead to the downfall of your startup.
Being nervous about changes or things that you aren’t comfortable with is totally normal. But outright refusing those things could spell failure for your business.
7. Putting profit before problem-solving
Yes, you’re in business to make a profit, but if you forget that your main goal in the process is to help people solve a problem they have, you won’t find very much success. Profits and problem solving go hand in hand when it comes to business. Don’t be so profit-driven that you forget this vital side of your business. When interacting with your customers, let them know how you can solve their problem.
8. Being too slow to launch
If you’re always finding an excuse to delay your launch, you may be setting yourself up for failure. Holding off until things are absolutely perfect may cause your startup to fail in the end. Nothing will ever be perfect, but it’s important to still move forward. Set your launch date and stick to it – force yourself to finish everything as best as possible and get yourself out there. Holding back does nothing for your business, and could lead to what’s known as “failing slow.” If something isn’t right, correct it or get rid of it, then move on.
9. Being quick to pull the trigger
At the same time, the total opposite can be true. Being so eager to get started that you’re not fully prepared can set you up for failure. A simple way to see if you’re pulling the trigger to fast is to ask if what you’re about to release is useful. If the answer is no, then you need to do more work before you launch.
Of course there could be any number of reasons why a startup may see failure in its future. But these common mistakes are easier to avoid, because you’ve seen them made by those who have come before you.