Insufficient capital.
Although determining the amount of capital you need is one of the more difficult issues for a start-up, this task becomes much easier once you have a business plan and a board of advisors. Besides, having enough capital is an absolute necessity if your business is to grow beyond the dream stage.
Capital requirements for the 3-, 6-, 12-, 24- and 60-month benchmarks should be determined well in advance, and you must be reasonably sure of your source of funds, whether it's private or public capital investors, personal funds or loans.
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Also be aware of the other side of the same coin: excessive debt and overhead. Debt can destroy your start-up, so stick to your business plan, and don't let appetite exceed budget or planned expenditures. "Too many entrepreneurs bring the infrastructure 'bloat' from their previous corporate careers to their start-up," says Pierce Johnson, founder of Chicago-based Johnson Technologies Inc. (which he sold last year to eSkye Solutions). "Most of the failed companies I know added too many employees too soon."
Basic rule: Stick to the business plan, and if a particular expenditure isn't budgeted there, forget about it.