3 business mistakes that all start-ups make
All new businesses face a set of challenges when attempting to get their ventures off the ground, with the risk of simple errors particularly high in the early stages.
While the business world is a potential minefield for any new start-up, there are some risks and mistakes which are more common than others.
Every entrepreneur yearns for immediate success when launching a new product or service but for those whose dreams come true, the end result can be more damaging than expected.
Success at an early stage can breed overconfidence in business leaders – setting them up for a fall. In an interview with BB journalist Evan Davis, Lord Alan Sugar admitted this had been one of his own early faults, claiming “[his] big mistake was not recognising that early successes were not representative of the way markets normally go”.
The trick is to take every result and success with a pinch of salt and remember that no one has the Midas touch!
2. Poor money skills
Unsurprisingly, finance is another common stumbling block. There is a lot of data to get your head around in the early stages and a relaxed approach to accounts will only exacerbate the situation.
“Many firms with excellent potential for growth and fame are brought to their knees by leaders who do not know how to manage cash,” Alan Hall said in an article contributed to Forbes.
Failing to file appropriate tax records, pay staff or obtain credit are common errors, but so are over or underestimating costs and failing to make accurate financial forecasts. If you don’t recognise these pitfalls at an early enough stage, you could find yourself implementing major business restructuring methods sooner than expected.
3. Lack of tech know-how
A failure to embrace or understand technology has also been the cause of many business breakdowns. The digital world moves incredibly fast (just look at the recent rise and prominence of social media) and this means those not directly involved can become outdated – fast!
Mary Juetten says a lack of tech knowledge was one of her biggest downfalls despite being one of the individuals behind Tacklight – a self-guided software platform.
When told that her software needed to be written in a specific language/code, she failed to question the decision – a clear indication that the public consciousness is increasingly viewing technology as indecipherable.
“If someone designing my website came up to me and said ‘You should use this colour instead of this colour’ I’d be asking 17 questions about why. But I never asked why about this because it was technology.”
By Phil Smith
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