5 Mistakes Made By New Entrepreneurs And How To Avoid Them
The fact is that the time has changed, markets have evolved, and hence, only the adaptive entrepreneur will survive
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The entrepreneurial bug loves the millennials for their higher risk appetites. Contrary to popular belief, the entrepreneurial spirit is not innate but is an acquired trait. It is built on a foundation of iron-clad determination, grit, and above all, discipline. These qualities prevent the entrepreneur from committing the following five cardinal sins that slowly but surely lead to the death of the enterprise and the dream that sparked it.
Thinking out of the Box - An oft-repeated phrase of marketing gurus and CEOs worldwide, it diverts time and energy from the most important goal of an early-stage startup. When Steve Jobs rejoined Apple in 1995, he didn't think out of the box. He culled the production line to focus on Apple's most selling product and decided to improve it. The iPod came ten years later. Thus, it is better to find the one thing that works for you, beat the competition hollow, and then move to the next big thing. Not the other way around.
Hiring Friends as Co-Founders - It is true that friendships blossoming into business partnerships are the dream, sadly, it is more likely to wreck your company and/or your companion. Despite the apparent benefits of working out of the same garage, it ends up causing too much friction and leads to burnouts. History is replete with examples of nepotism leading to failure of entire kingdoms. Friendships are the next closest things to kinship. Thus, like product/market fit, look for your company/leadership fit before delegating decision making powers.
Reading too Many Autobiographies - Thanks to the information age, we now have access to more content than ever before. This means that the up and coming entrepreneur consumes 15-20 books a year, inspired by Bill Gates' claim of 7-10. From Sun Tzu to Machiavelli and Robert Greene, all inspirational authors lead to the development of tunnel vision. A common theme to all of the above is information asymmetry that they all claim to exploit. The arrival of decentralized systems and open source knowledge banks, information is available at one's fingertips and asymmetry can be ended with a simple Google search. Instead, reallocate that time to expanding your network as that will give you better returns than simply expanding your mind.
Getting Obsessed with Economic Modelling - Do you know how do countries decide the number of currency notes to print? Based on their requirements and the advice of the oracles (Central Bank officials). Similarly, poring over economic theories and modelling sheets is a pointless exercise beyond a reasonable limit. If you're planning out marketing strategies for your third biggest consumer segment, while starting up, that's beyond a reasonable limit. There is an old joke among economists, an economist can tell you what went wrong with the markets yesterday, tomorrow. As long as you've got your plan to retain your first hundred customers in the place, you're good to go.
Believing too Much in Yourself - If you build it, they will come, happens only in the movies. Real life will give your several signs that something or the other is not right and you must rectify them earnestly. If a bank refused to extend a loan to you, don't call them short-sighted, ask them what can you do to make them believe in your enterprise. If your employees are resigning within months of joining, don't call them incapable, ask them what would it take to get them to stay. The list goes on but you get the point.
Some of the points above, if not all, are usually considered good advice or found within lists that contain activities that an entrepreneur must commit to.