Entrepreneurs who start a business have to be alive to the fact trials, errors, and at times, embarrassing mistakes are a norm. It took me some time to understand that running away from my mistakes and failures does not always help. In fact, it almost ruined my entrepreneurial dream. And looking at some worrying stats about entrepreneurial fails, it is clear that the inability to cope with challenges is the leading reason why most businesses fail.
Failures are undoubtedly the most useful lessons for entrepreneurs. Looking back, I believe I can be of help to future entrepreneurs. Here are some valuable lessons that I learned from my failures and other startups to keep you going.
I have observed that many entrepreneurs, I included, start with inadequate capital. I’m aware that some businesses might not be capital intensives, say a dental firm , but most are (though dental firms may get financial consulting services from someone like Eide Bailly to help them out). Capital plays a huge role in the success or failure of a startup. When someone approaches me for advice on starting a business, I tell them that they should not compromise on capital. Having adequate capital assures you that the business.
Any entrepreneur often starts their journey with big dreams. As much as positivity is the stimulus of any entrepreneurial journey, you have to be real – and this means that you should embrace the fact that things could go awry. Therefore, any business needs to have a contingency plan for the dark days. For instance, you might not be open to the possibility of establishing a line of credit from your bank, but it can be invaluable when you hit a bump along the way.
The business landscape is dynamic. In light of this, never let your business plan and financial projections gather dust. Failure to keep tabs on the business, adjusting, or both are a leading cause of business failure. While you might have your projections backed up by market research, I would advise that you make your business plan or financial projections living documents. By this, I mean that you should keep monitoring your progress and update your forecasts accordingly. As an example, if you are in a physical business, such as cleaning, construction, etc. you need to be assured that you are on top of all you need for the business and what you have to cover, for instance, keeping to DOT regulations will help keep your vehicles and drivers safe, failure to comply may result in loss of vehicles which will seriously affect the business. Keeping the necessary records and doing the monthly/yearly check-ups will stop this from occurring.
Some entrepreneurs are often reluctant to embrace the fact that they need outside help. As a result, they are bound to burn out soon or make costly mistakes that could ultimately force them out of business. Well, I understand that you could have some reasons for going it out all alone, but you also need to avoid overstretching yourself. I only realized the importance of having partners and an able team around me when I started a logistics company in 2016. Having a good group of people around you can take some of the pressure off you, allowing you to focus on running the business. Perhaps it’s worth hiring a sales team to try and generate leads for your business. The sales team will probably recommend that the business uses sales territory mapping to target the local area for potential clients. That would benefit business sales, so it might be worth hiring a sales team. As well as having a physical team, it is important to do your research, for example, if you were starting an internet sharing business then you would perhaps look at blogs like RMH OF BANGOR to get advice on how to start this kind of business. It is very important to do lots of research to know what other people got wrong and what others got right.
Some entrepreneurs often ignore what their customers are saying. I suggest that this might be the worst thing you can do in your entrepreneurial career. When you think about offering your customers a new product, I suggest that you should bring them on board to validate the idea. Business is not about what you have to offer, but what your customer wants. From my experiences in the industry, customers matter more than investors do. And just because some customers want a product does not mean that it will suit all. So as you listen to their recommendations, make sure you qualify their inputs.
We all try to underprice our products when starting a business or launching a new product thinking that customers are drawn to low prices – false. Underpricing often leads to a lower perceived value, and this might only attract the wrong customers. You have to be intentional when setting prices. And when you set your prices up there, make sure that you have solid reasons to back up your valuation – have a value proposition.
I made my mistakes, and I learned. Even though some of the mistakes I made in my career almost ruined my life, the lessons learned were undoubtedly worthwhile. Therefore, if you can learn from my mistakes, you will save yourself a lot of money, time, and headaches. And most importantly, you stand a higher chance of defying the notion that “90% of startups are bound to fail.” I wish you all the best, but only if you start!