4 Common Startup Pitfalls
Building a startup is difficult and launching one is even HARDER! Many new entrepreneurs have very little business background. Learn from those who have been there, done that.
Here are 4 common pitfalls that new startups face:
- PUTTING ALL YOUR RESOURCES INTO PRODUCT DEVELOPMENT
Product development is just one aspect of a new business that needs resources. For example, resources also need to be allocated to marketing, customer acquisition and the team. This is difficult for first time founders to realize because their main concern is finalizing the product. Although you should plan to allocate resources for product development, you should do the same for all other aspects of your business. Keep in mind startups are able to generate funding from investors with only a concept through Kickstarter campaigns.
- CANNOT FIND A PROBLEM WORTH SOLVING
Many founders believe that if a problem exists for them, it must exist for everyone. Although this is a great place to START (finding a problem you are currently experiencing) it does not mean it is a problem worth solving. Find a customer segment to focus on then validate that this segment is experiencing the same problem by conducting face-to face interviews. This validation process is often missed by new entrepreneurs but it is a key success factor.
- BEING A ONE MAN TEAM
Many founders find it difficult to trust others with their new business idea. They may feel like they know everything about the industry but sometimes forget about other areas of a business such as finance, marketing, human resources, client services, IT, etc. Finding a partner and team members is crucial for startup success. In order to get to the point of scaling a business, startups need 3 distinct skill sets; business acumen, domain knowledge and operations experience. These skills can be held by one founder, two founders, or even a team. But before scaling a startup you should have all three corners of the talent triangle covered.
- WRITING A BUSINESS PLAN
A business plan in the 21st century is called the Lean Startup Methodology. The lean startup methodology uses information to navigate the path to a successful startup – it tells you where to go, when to turn, and when to persevere and grow at maximum acceleration. A traditional business plan is dormant; it becomes obsolete the minute it’s printed. Why? Because your startup will be evolving and pivoting constantly and the best way to display your startup is on a Lean Canvas. The lean canvas is a 1-page, point form, summary of your business model, that can be completed quickly. Once you start developing your Lean Canvas, you will start to see your startup come to life.
Learn from others and the 4 most common pitfalls for a startup. Overcome the above and you will be one step closer to startup success!