Every startup founder needs a guardian angel to shield them from the inevitable and common entrepreneurial mistakes they often make, especially if it’s their first time around. Alas, magical startup powers are out of stock at the startup store but the fact remains that building a startup is a fairly risky move, especially when you account for the dreadful statistics on startup success.
Mistakes founders make are as varied as a shark’s menu but they usually revolve around self-inflicted instances. Through the power of retrospect and insights from me and my fellow entrepreneurs, here are major startup mistakes to avoid.
1. Being more in love with the potential than “just” a successful business
Years of experience have taught me that whenever I had an idea (great or so-so), I began by being fully in control, owning 100% of that idea or company. But what happens next is something many startup founders find hard to swallow:
you eventually have to surrender your idea/company to someone else for it to be successful.
Your 100% ends up being 50%, 30%, 15% – significantly less than what you imagined, short of the startup’s potential. And people cling on to their vision, letting their ego get in the way. In this line of work, it’s simple: if you put your ego aside and focus on being an entrepreneur that delivers, you have 100% of the success, always. I was guilty of being in love with the potential and learned a valuable lesson:
there’s a limited amount of time where you can trust only yourself.
You can’t be everything all the time – entrepreneurship doesn’t work that way. It’s a team sport where the right people around you and the chemistry between you drive success. Without them, your chances are very close to zero.
2. Surrounding yourself with people for the present, not the future
It’s easy to see how this can happen: you operate here and now, and you’re facing very specific challenges that stand in the company’s way.
But there is also such a thing as unplanned growth, and it’s reflected in one of the common mistakes startups make: picking partners and employees that solve the current problems but don’t have either the skills or knowledge or flexibility to solve the problems that are about to happen. And they will happen and they will lead to miscommunication, frustration, and chaos.
A successful startup will swiftly outgrow everyone’s current skills and responsibilities. Surrounding yourself with the right people who can both grow with the company and help facilitate its growth is very important. You need a strategic plan to make the most out of human resources. People with previous startup and SMB experience can help as they typically have the right mindset. You can also look at similar startups that are either exactly where you are now or advanced from the same spot.
There’s no formula to future growth – you’ll likely make a few mistakes (which is why this is such a regular mistake) but it’ll help you minimize the potential damage from the get-go.
3. Accepting feedback subjectively
Not listening objectively to feedback, especially when it’s negative is a big mistake. It tends to make startup owners angry, overly defensive, and blind to the truth. Acting on feedback while not truly understanding it impairs the effectiveness and falls short on using it as a learning opportunity.
Actually, negative feedback is great because it means there are people out there actively interested in your product or service and care enough to let you know what needs to be fixed. You have traction but your solution is not good. You’re onto something and there’s room for improvement. Take time to process and deconstruct feedback, even if it’s from a flawed source.
This brings me to the next entry:
4. Not pivoting or folding when you have to
As typical startup mistakes go, this one is close to the top. I could write a short book on how to avoid the mistakes of entrepreneurship solely by listing examples of people that didn’t realize it was time to adapt or worse, throw in the towel.
I’ve seen far too many situations where ego takes over. You begin to focus on ‘not losing’ and run yourself to the ground, sometimes even risking health and personal capital just to avoid the notch in the ‘loss’ column or having to tell your investors the company flamed out. That’s why not pivoting and/or folding is one of the biggest startup mistakes to avoid.
There is no middle ground here (which is why you need to fail fast, particularly if you are running an online business) if you burned through the money or had a shitty idea that yielded zero feedback or if the passion is gone or whatever the reason for imminent failure is. Sometimes, the most mature and sensible thing you can do is to call it quits.
5. Not putting your startup as a priority
I’ve left the worst for the end: people who are trying to run a business on the side. A significant portion of people I meet falls under the category of ‘wannabe entrepreneurs’ who have a cushion to fall on in case their SaaS or app or whatever doesn’t pan out.
I’ve never seen or heard of a successful person that had a full-time job and did a ‘startup thing’ on the side. Never.
Not putting your startup as the numero uno means having a fallback: thinking about the security you have and holding on to it. As a species, we are wired to try to be as comfortable as possible. The truly hard thing – and ultimately, what separates successful startup founders from the rest – is trying to do the opposite: fully committing yourself and being obsessively passionate about building a startup that will make a difference.
To an investor such as myself, being partially invested says you have a ready excuse. That’s a perfect way to lose the ever-important trust and confidence of both those around you and potential investors.
The road to startup stardom is filled with obstacles and speed bumps, and it’s easy to veer away from the route. The startup mistakes to avoid mentioned above are far from the only ones – these are the ones I can offer from personal experience, as well as those of friends and peers. It’s my hope that this bit of information will help you steer clear of at least some of them. Hindsight is 20/20, and you should be lucky to have this form of foresight at your disposal. Be smart about how you use it.