Many entrepreneurs start their business with solid ideas, but few actually follow through or have the know-how to keep it alive. Here are a few common mistakes that entrepreneurs should avoid when starting a new business.
Part of having a successful business is realizing what your company needs to grow. Many entrepreneurs make decisions based more on emotion rather than reason and forget the real value in good employees. Avoid the following staffing errors:
- Hiring the wrong people. Rather than hiring people that you want, focus on hiring those that will bring real value to your company.
- Firing the wrong people. Don’t let people go because they threaten your ego or your friends in the company don’t like them for reasons unrelated to the business. Fire them only because they are incompetent or otherwise cause the company to lose money.
This is another area where you need to keep your emotions in check. While you don’t need to wait until you have enough money before developing your company, you should always be moderate and wise with your funds. Common errors in finance include:
- Spending too much too soon. You need to spend as little as possible while you find a realistic business model.
- Spending unrealistically. If you underestimate the funds that you require for your startup, you’ll dramatically lessen your chances for success. Confusing capital with costs will doom your company from the very beginning.
Timing is an area that often results from how much you doubt yourself. If you watch the market carefully and keep an eye on the competition, you can make confident timing decisions. In addition, keep in mind that indecision can be a wrong decision. Avoid making bad timing mistakes that involve:
- Delaying important decisions. Realize that because you’re a startup, you have the luxury of executing a decision within a few hours, unlike large corporations where important decisions can take years.
- Waiting too long to launch and allowing opportunities to pass by. Don’t think that you have to finish all the little things first before launching your business or that the market first has to perfectly fit your product or vice-versa.
- Giving up too soon. Exercise enough patience to see your company through to its first big sale. Have the attitude of surviving until success finally arrives. Only you direct the destiny of your company.
Sometimes you get in your own way. If you always try to practice humility and surround yourself with people who are smarter than you, you’ll always have something to learn and your company will continue to progress. Avoid these common errors that involve a big ego:
- Wearing too many hats. Many entrepreneurs have seemingly unlimited energy and ideas, but they make the mistake of thinking they are the best person for every job. Ponder on how many successful companies have been run by one person, and then begin relying on others’ abilities.
- Not sharing and talking about your ideas. Realize that you are not the only one with the newest and best ideas. Don’t feel threatened or paranoid sharing your ideas with your staff. They can improve upon your ideas or breathe real life into them, increasing your company’s chances for success.
If you can avoid these common entrepreneur pitfalls, you will undoubtedly increase your chances of surviving the start-up phase of your company and prospering in the long run.
About the Author: Robert Cordray is a freelance writer and expert in business and finances. After 20 years in the business realm giving entrepreneur advice and consulting, Robert decided to commit to helping others succeed in their appropriate career.