You might have realised that today’s date is 10.10.10 and so in honour here is 10 reasons why many start-ups fail:
The first reason why start-ups fail is because they never get started in the first place. Many people talk and talk about an idea, dream of how they will achieve it but never make the leap. This is an extremely common occurrence and sometimes there is good reason, but sometimes this empty talk can be a waste of time to entrepreneurs looking to work on a project.
2.) Too General:
Having an idea that has been done by everyone under the sun is not the best way to go about starting a business unless you have a differentiator or niche to your product/service. Trying to break into a market is very difficult unless you have something that sets you apart. You don’t need to invent the next Google or Facebook but make sure you concentrate on one thing and make sure you do it well. It’s simple but something that many people forget.
3.) No Plan:
Always, always set out a plan. Make sure you have an idea of what it is you are trying to do and write it down. Always refer back to it to make sure you aren’t wondering off track. You will encounter problems and things will never go exactly to plan, but make sure you have an idea of where you want to go and establish how you wish to go about it. Your Business Plan will continuously change but use it as a guide. It can also be very useful when it comes to looking for funding.
4.) Funding Illusion:
Don’t fall in too the trap of assuming that funding will be a given. Make sure you have a plan beyond receiving funding. If you don’t get it ensure your business still has a future. Sometimes you can end up getting carried away with trying to get investment that you waste time as it is a long process. It may be better to spend that time building the business.
5.) Ineffective Print Media:
Spending money on business cards and flyers is often a waste of time and money. In the early stages you will probably have little capital and so spend it wisely on areas which will be profitable. Also with your business changing rapidly these can be outdated fairly quickly. This form of media tends to be very ineffective, so don’t waste your time.
6.) The Website:
The design of a website can provide an instant image of your company to potential customers, don’t overload it with useless content and make sure it is kept simple an informative. Also at this early stage there is no point in spending hundreds or thousands on a fancy website, there are plenty of sites where you can easily design a free site. If you do feel you need a designer, limit the cost at this stage, keep it simple and clean. Try to negotiate to pay in instalments or get terms that allow you to get changes made for free, testing is an important part of any website. At least this way you can be making money to pay for the website design.
7.) Self Promotion:
Remember your customer doesn’t really care about you, they are there to solve a problem, so ensure your site is showing off what your business does not what you do.
8.) Untargeted Advertising:
Depending on your product/service you will need to target your advertising accordingly. If you are using offline media make sure you aren’t wasting money advertising to the wrong people. Always make sure that you know who your customers are. Then when deciding on advertising think for a moment will your target market see your advert. Also makes sure you have a call to action, tell them what to do. This leads me onto online marketing; there are many free ways to do this by using social media and blogging techniques. You can also use tools such as Google Adwords to gain customers through Pay-Per-Click (PPC) marketing, but again don’t get carried away trying to get as many people clicking your website as possible, make sure they are targeted and therefore more likely to lead to a conversion. Wasting money is the last thing you want to do at this stage.
9.) You Quit:
When things aren’t going well you quit. Well that isn’t going to get you anywhere. Make goals and motivate yourself to reach them. You will make mistakes and there will be challenges that is a given, its how you get through these that shows what your made off.
10.) Finding Your Market:
A big reason why many start-ups fail is because a company just cannot find enough customers. Either the product/service is too niche or the product/service may not be in demand. Ensure that you are not pricing customers out and make sure your product/service is of good quality. Make sure that you have enough potential customers to stay profitable beyond the early adopters.