4 Deadly Mistakes That Startups Make In Early Stage

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90% of startups fail. Most of them die a slow death while others flame out.


Based on my years of advising startups, I see some common obstacles which startups face in their initial months. However, there is a way out. If you know how to scale the wall, beyond every obstacle is growth.


Too often startups have an excellent idea which they are all fired up. Then they jump to the next stage. Funding.

Pause. The next step is testing. Does the idea have legs? Legs and the entire body for running a marathon and not a sprint. What does that mean?

Who are the customers for your idea? What is the problem you are solving in their life? If it is a B2B product, the customer wants to either increase revenue or reduce costs. That's it. The rest is low down the priority. Does your product do that? If not, find how it can. If you still can't, then drop the idea. If your solution is way down the priority, chances are you will spend a lot of time and effort just getting your foot in the door. Monetization will be a distant boat.

Know What is Helpful for Business

"Me too" is helpful for making friends but definitely not for business.

Differentiation is the heart of a successful business. Sure you may cite some tech titans who copy fast and build a business. But they have size on their side and large legal teams to fight battles. You have neither.

Once you have the idea nailed down and identified that it solves the problem for the customer, ask yourself "Why should they buy from me?" Find out the solutions that they are using today and how you can improve on it. Even better: do you have a solution which no one is providing today?

Know your Customer

Have you ever had a customer say that? If not, you may in the future. It could be framed as "If you are so confident of your benefits, then, let me run this for a few months for free and if it works, I will pay you."

What do you say "Sure, go ahead. Walk all over me" or "How dare you? Are you Uncle Scrooge?"

Hopefully, none of the above. The point is you need to figure out the customer's objections well in advance. Too often we get all fired up about the idea and forget that the customer gets a million requests every day. As it is we live in a permafree environment (think WhatsApp).

A objection could also be "You are new and untested. Why should we buy from you?"

Each of these objections needs an answer which you must be prepared for. They must be unique to your business and the vision you have for the idea. More importantly, keep bringing out the problem that you are solving for them.

Scale up your Product Offering

Well, maybe not the Yacht. But you get what I am saying, right? Too many startups scale up very fast (investors also are partially to blame) and scale up not at the product end but the cost end. A lot of money is spent hiring people (often on marketing side and admin) or on making costly "brand building" campaigns.

If you have to scale up, scale up your product offering. Improve the payment gateway. Improve the responsiveness of the site or your offering.

If you need people, outsource first. If you have to hire, figure out by how much profit needs to increase to justify the next hire. Note profit and not revenues. While Sales can come just by throwing money, profits require paying customers and costs below revenues.

There are other obstacles too, but these are the deadliest. Surmount them and you are on your path to success.